The Pacific Palisades fire in Los Angeles, California has definitely affected property values. 14800 Mc Kendree was listed for $9,495,000 until the fire hit. After the fire February 7, 2025 and the home was destroyed it was relisted as raw land for $2,895,000. That's an almost 70% discount. Normally land value is 60-70% of total value in this area. Real AVM says it's worth $9.4M because it was listed for that. That means land was maybe worth $6.5M. It's now for sale for less than 50% of alleged land value. He owes $4.5M on the home. Property taxes are $90,000/year. I don't blame the guy for selling. I would too.
Part of the discount is because the debris must still be demolished and removed. One has to do toxicity tests on the soil before rebuilding. There are no utilities with no date for when utilities will return. Even the foundation may be destroyed from heat and need to be dug up. The permit process will take a long time as will the building process. The sale and construction will probably have to be all cash. Generally an all cash deal is about a 20% discount. If only a developer can buy the property, that's another 20% discount because they must have profit after all costs including holding costs. This sale prices makes sense.
Whoever owned the home still has to pay the mortgage. If they wanted to rebuild, they'd also have to pay for a construction loan which I doubt they'd get. They'd most likely have to pay all cash for construction. Only developers can afford to take on these huge expenses and holding costs. Even after the home is built fire insurance will be a big expensive issue. The area and home will still have stigma from the fires. I predict it will be a while before the home prices in the area return to pre fire values.
Before fire listing until January 25, 2025. "Welcome to the peaceful luxury that is 14800 Mc Kendree Avenue, ideally located above the coveted alphabet streets and a short walk to the Palisades village teeming with high-end shopping, dining and movie theater. This property is the perfect retreat you've been waiting for, a traditional showpiece that boasts 7400 square feet with 6 bedrooms and 7 baths. Step inside the front door, and pause to take in the dramatic sweeping views of the pacific coastline and Catalina Island. The home is as much an escape from the city for family and friends as it is an entertainers paradise. "
After fire listing February 7, 2025. "BE PART OF THE REBUILD. This highly desirable 7692 square foot street-to-street lot sits above the Palisades Village with sweeping ocean views. This is an opportunity to rebuild the beautiful 7400 square foot home that sat here plus an additional 10% square footage for a current buildable maximum of 8140 square feet. The lot comes with the original plans for the house, which would govern the rebuild, along with limitless potential for the visionary buyer.This is a rare chance to invest in the beloved Palisades, which will again become one of the most close-knit and sought after communities in all of Los Angeles. EPA Phase I is complete for this lot as of 2/5/25.Serious offers only."
Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.
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