Meanwhile, fire zone housing value tops $46 billion, according to a new Zillow analysis.
Almost a year after January’s devastating California wildfires, real estate investors have been buying up nearly 40 percent of the land sold in the areas impacted by the fires.
A Dec. 30 report from Redfin stated that many of these now-empty lots once retained some of the nation’s most expensive homes, before they were reduced to rubble when the fire ripped through over 40,000 acres and destroyed more than 11,000 single-family homes in the Los Angeles suburbs.
A Zillow analysis—also released on Dec. 30—indicates the total residential housing value of the 19,605 homes in the affected regions was $46 billion prior to the fires. More than 11,000 of those homes were destroyed.
The median home value in Los Angeles suburbs was listed at $1.95 million as of December 2024, prior to the fires.
Zillow’s report shows that for-sale housing supply near the fire zones escalated soon after the fires ended. In addition, new listings within five miles of the fire regions continued to grow from December 2024 to January 2025.
“While home values nearby have dipped a bit, in line with broader Los Angeles trends, the most evident impact was on supply,” Orphe Divounguy, a Zillow senior economist, said in the report.
“The sharp increase in listings just outside the burn zones likely reflects a mix of homeowners accelerating planned sales or owners of second homes deciding to list in response to the sudden shift in local demand.”
According to Redfin, investors were responsible for buying 48 of the 119 lots for sale in the Pacific Palisades area during the third quarter. In nearby Altadena, investors purchased 27 of the 61 lots available, and in Malibu, 19 of the 43 lots for sale were bought by investors.
Redfin’s analysis indicates that many investors made lowball offers for lots in Altadena, where some of the destroyed homes had been built in the 1940s and 1950s. These lots have been selling in the $500,000 to $600,000 range. The report noted that while some owners rejected these offers, others were forced to sell as they lacked the money to rebuild.
By comparison, a typical empty lot sold for $1.6 million in Pacific Palisades, and for $1.3 million in Malibu.
“It’s not uncommon for investors to buy and develop land after natural disasters,” the report stated.
However, while investors have been making inroads in getting vacant land off the market, Redfin agents say there is so much vacant land for sale that much of it remains unsold.
Meanwhile, those homes left standing in the fire zones are attracting offers if they’re reasonably priced, with owners usually handling the ash and smoke damage remediation.
By Mary Prenon
