Investors Buy Home Lots in SoCal Fire-Ravaged Neighborhoods

Investors have become major buyers of housing lots in the neighborhoods hardest hit by the January 2025 California wildfires, accounting for roughly 40 percent of all lots sold in the most affected ZIP codes.

An analysis of county records shows that in Pacific Palisades, investors purchased 48 of 119 lots, or 40.3 percent, sold in the third quarter of 2025 — compared with zero lot sales of any kind a year earlier, Redfin News reported. In Altadena, investors bought 27 of 61 lots (44.3 percent), also up from zero the prior year. And in Malibu, investors purchased 19 of 43 lots (44.2 percent), more than double their 21.4 percent share a year earlier.

Around 80 percent of those lots previously had homes on them.

The surge in investor purchases comes as fire‑damaged neighborhoods face slow rebuilding timelines, insurance challenges and a glut of land listings. Redfin agents report that many Altadena residents, especially elderly homeowners and those who were underinsured, are accepting low offers because they lack the financial means to rebuild. Many homes destroyed there dated to the 1940s and 1950s, and owners have waited nearly a year for permits. Some residents remain in nearby rentals; others have left the area entirely.

Pacific Palisades presents a stark contrast. With average household incomes near $400,000, many displaced homeowners have purchased temporary residences — often multimillion‑dollar homes in Santa Monica, Santa Barbara, Manhattan Beach, Orange County or San Diego — while planning high‑end rebuilds. One buyer purchased a $3.8 million Santa Monica home while preparing to rebuild with a prominent architect; another bought a $4.7 million Pacific Palisades home after losing a Malibu property.

Across the analyzed ZIP codes in the neighborhoods, listings far exceed sales. Lot listings have surged to 309 in Pacific Palisades, from seven a year earlier. In Altadena, 225 homes are listed for sale, up from two a year ago. And in Malibu, 214 properties are on the market compared to 125 a year ago.

With so much supply, sellers are cutting prices.

“Many of the lots that are selling in Altadena are in the $500,000- to $600,000-range” said Redfin agent Sylva Khayalian. “If there was still a home on them, they might sell for $1 million or more.”

Typical lot sale prices were $510,000 in Altadena, $1.6 million in Pacific Palisades, and $1.3 million in Malibu.

Single‑family home sales remain depressed relative to pre‑fire levels, though they have rebounded from record lows immediately after the disaster. Pacific Palisades reported 31 home sales in the three months ending Nov. 30, down from 45 a year earlier, while Altadena saw 58 sales, down from 67. Lot sales now outnumber home sales in both areas, reversing historical patterns and prices that faced downward pressure.

It’s common for investors to buy homes after a natural disaster, as Insurance costs and remediation burdens present major obstacles to rebuilding. Redfin agents note that some homeowners, overwhelmed by ash, smoke and lead remediation expenses, grimly joke that rebuilding is harder than losing the home outright.

— Joel Russell