Residential home prices continue their upward trajectory in Orange County, where a lack of inventory and comparatively low unemployment rates (3.3 percent in the county versus 4.8 percent statewide, according to an April Bureau of Labor Statistics report) are keeping the market sizzling — particularly in high-demand coastal areas like Corona del Mar and Newport Beach.
There were seven O.C. transactions in excess of $20 million from January to August of this year, not including off-market transactions, according to Andrew McDonald, a broker with The Agency. Compare that to only four sales above that price over the same period in 2016.
There was traction across almost every price point, McDonald said. “Homes and condos under $500,000 are steadily disappearing,” he said. “We have less inventory under $750,000 than in all our previous years back to 2012.”
There is more inventory coming on the market, but not at lower price points. In September, Toll Brothers began showings of its model houses in Alta Vista at Orchard Hills in Irvine. The 5,590-square-feet-and-up houses carry list prices beginning at about $2.5 million.
But there’s another trend gaining ground in the O.C.’s residential market: a greater push toward older homes being torn down and rebuilt as spec properties, McDonald said. “In Corona del Mar, you can drive down each street and there is a spec home being built. By the time it is completed there is a buyer already for it,” he said, estimating that there are at least 50 custom homes under construction in the greater Newport Beach area.
On the commercial front, older properties are getting trendy updates. Flinn West, a Newport Beach-based commercial development and property management company, revamped the 36,000-square-foot, three-story Harbor Medical Center in Fullerton, which was built in 1976.
Flinn has also redeveloped the site of a former 24 Hour Fitness in Huntington Beach. The 15,000-square-foot building will be pitched to appeal to yoga and cycling studios, high-end nail and hair salons and bars and restaurants.
The fifth most populous county in California, with 2.14 million residents, according to a 2016 Census estimate, saw single-family home prices increase by 7.8 percent in August over the same period last year, according to CoreLogic. Sales of condos were even more heated — prices in August were up 24.7 percent.
There are a number of new developments in the works. Among them is New Haven, a master-planned community in Ontario Ranch developed by Brookfield Residential that is slated for completion in July 2021. The 124-acre, 1,006-unit development has enjoyed brisk sales, ranking it among the top five best-selling communities in California this year, according to the real estate advisory firm RCLCO, which provides market and financial analysis.
Anchored by hefty developments like a 7.6-acre Kaiser Permanente medical campus and a range of upcoming master-planned communities, hotels and parks throughout the county, Ventura “is becoming a preferred environment for the retired with its temperate climate, wide array of housing opportunities and excellent restaurants and shopping,” said Page Taylor, a Realtor at Village Properties in Montecito.
On the commercial side, the $4.5 million Kellogg Park project in the city of Ventura is slated to open next April. The 2.4-acre space will include an amphitheater, a playground and community gathering spaces.
Outdoor clothing company Patagonia, one of Ventura’s largest employers, is said to be expanding its headquarters after purchasing the former site of the defunct Brooks Institute this year.
Hotel group H. Parker Hospitality is planning to develop a four-star boutique hotel at Ventura Harbor as well as a hostel for budget travelers. Both projects, according to a source at the Ventura Chamber of Commerce, are currently going through environmental reviews.
There are also plenty of new residential developments in the pipeline, including Solana Heights from CalAtlantic Homes, a master-planned community on the west side of Ventura with 120 single-family homes, 36 condominiums and 50 affordable senior apartments.
Median prices for single-family homes in Ventura County were up 5 percent in August over the same period last year, while the median sales price for condos was up 5.3 percent, according to CoreLogic.
The desert resort city of Palm Springs is the crown jewel of Riverside County, with its music and film festivals, prestige golfing events and affluent residents. The roster of attractions has amped up demand for properties, said Tony Halton, president of the desert division of Halton Pardee and Partners, which plans to establish a Palm Springs office by the end of this year.
“Palm Springs used to be a retirement center for people from Orange County and a spring break destination,” said Halton. “Now the hip L.A. crowd is coming in.”
And that crowd, said Halton, is leaning toward having a home in the Coachella Valley, which includes communities such as La Quinta, Cathedral City, Indio and Indian Wells. The median price of detached homes throughout the area as of the end of August was $365,000 — 4.3 percent higher than for the same period last year, according to statistics compiled by the Palm Springs Regional Association of Realtors and the California Desert Association of Realtors. La Quinta saw some of the steepest price growth: Detached homes were priced 13.9 percent higher in August compared to August 2016.
Upcoming projects could certainly help the continuing revitalization of some desert cities. Virada, from the Palm Desert-based Family Development Group, is currently being developed in Indio. The $451 million master-planned community will have 1,300 townhomes, condominiums, apartments and single-family homes, as well as 284 acres of open space and public parkland and a 2.5-acre commercial center.
Miralon, from Freehold Communities, is a sustainably designed “agrihood” in Palm Springs offering 1,150 homes rendered in a modernist template. The 300-acre spread, which breaks ground this year, was once an 18-hole golf course and will encompass single-family and attached homes with a full roster of amenities including a spa, health club, coffee bar and full-service bar and lounge. Bradley Shuckhart, Freehold Communities’ California Division president, said that prices will range from the high $300,000s into the high $700,000s.
On the hospitality side, the Hotel Paseo, from Autograph Collection Hotels, is scheduled to open by the end of this year in Palm Desert. And coming next year is a Virgin Hotel in the heart of downtown Palm Springs.