For La Jolla’s Housing Market, Signs Point To 2021 Being A Good Year
Since the early onset of the coronavirus pandemic, homebuyers have moved fast and furiously through the limited inventory available in California’s most desirable pockets. The La Jolla real estate market was among the areas to receive a surge of interest, a wave that appears poised to continue into 2021.
To get a sense of La Jolla’s housing market and where it might be headed, I spoke with longtime resident and luxury real estate specialist Linda Daniels. Having ranked among San Diego’s top producers for more than two decades, the Willis Allen agent possesses an intimate knowledge of La Jolla and surrounding coastal areas. Her comments have been edited for clarity.
NL: In terms of how the luxury market has performed this year, what was your ‘wow, this is getting crazy’ moment?
LD: When it all started in January, I had two sales and thought to myself ‘oh, well, maybe I can clean out my closet and contact some of my sellers’. If I had known how busy we were going to be in the months that followed, I would have spent a few weeks at the beach. There are three of us in my group and I would say we are all working a minimum of 10 hours a day. It’s been very crazy.
NL: Talk about the buyer profiles you are seeing? Has COVID brought a new demographic to the area?
LD: It’s still largely people buying their second and third homes or people moving from one area of La Jolla to another. I’ve had about 20 transactions this year and four of them involved out-of-town buyers from Minnesota, New York and Texas. Of those four, three buyers were purchasing their third or fourth properties.
The Minnesota client, for example, has a main residence in Minnesota and has another property in Scottsdale. They wanted one by the beach and ended up buying a nice little pied-à-terre to use once in a while.
We also have a bit of a celebrity attraction right now. It’s quiet and very private down here, and what [celebrities] like about it is the anonymity. I’ve sold to screenplay writers and I’ve sold to stars; Mitt Romney lives down here, so dies Alicia Keys.
NL: Do you think those second- and third-home buyers are starting to look at La Jolla as an alternative to Los Angeles?
LD: There’s privacy down here that you don’t see as much in Los Angeles, and the houses are a less expensive alternative to Los Angeles. The building costs are also interesting. I have a builder down here that I work with that is now doing projects in L.A. He said that a house that he’s building in Los Angeles for $30 million is probably in the range of anywhere from $9-10 million down here. Buyers get more for their money down here.
NL: What are some of the things you are seeing at the top of La Jolla’s market?
LD: In La Jolla, we have 16 neighborhoods, and I would say six to seven of those are more high-end than the others. We have right now about 125 listings on the market and only five of those are $20 million and over, which is interesting when you compare that to Los Angeles. Our prices are a little more palatable. I think because of the lack of inventory — 125 listings are nothing — it remains a seller’s market.
NL: How has COVID-19 changed how you sell real estate?
LD: These are strange times. You don’t put anybody in your car to do touring anymore, and you don’t have that one-on-one connection. To do open houses virtually — it’s difficult. Lots of sellers are nervous about having people come into their homes. We do everything by the book, but it’s very different. It’s a different time.
NL: Do you feel the average La Jolla buyer now has a different mindset when it comes to their wants and needs? What are some of the trends you are seeing?
LD: They want an extra bedroom so they can have an office or they want a little more land, They don’t want to be down by the beach. They want to have a backyard where the kids can go out and play.
NL: Has there been a migration from the beach during the pandemic?
LD: I don’t think there’s been a migration, but people’s thought processes have definitely changed because of COVID.
NL: What are some of the in-demand neighborhoods in La Jolla right now?
LD: A lot of the buyers that come into La Jolla, even if they’ve never been here before, their whole M.O. is having a view, which means they have to be high on the hill. So there’s the Country Club area, the Muirlands, which is our largest neighborhood in La Jolla.
Then there’s a pretty neighborhood near the water that’s called Lower Hermosa. The homes there are very pristine, very well cared for and have a little bit of an East Coast feel.
There’s also a neighborhood where Alicia Keys bought that’s called the Farms. The properties there are usually on an acre and have a lot more privacy. La Jolla really has a neighborhood for every need, every wishlist and every want.
NL: You have a very unique listing right now in the Bird Rock neighborhood. What’s the history behind the house?
LD: It’s a lovely Spanish house of about 3,400 square feet. The [late owners] who had lived there since the 1960s, they were travelers and they loved Mexico and Guadalajara. The house itself is filled with doors that they brought over, tiles that they brought over, stained glass that they shipped here. Beautiful details — it’s a very unique property. The house overlooks Tourmaline Beach, a big surfing beach here in La Jolla. I always feel blessed to be able to represent these types of properties.
NL: The holidays generally bring a lull to the market but this year has been quite different. What are you seeing?
LD: Well, we just closed on three properties to the tune of about $18 million combined and we have three others closing this month. I’m still seeing a lot of activity in the market. It was a little slower around Thanksgiving, maybe for about five or six days, but now it’s picked up again.
In November, things were still going strong. In La Jolla, the median price in November went up 7.2% from the previous year. So, we’ve had some nice appreciation. Part of that is because we have no inventory and so we’re having multiple offers and prices are escalating.
For a while, houses were on the market for 6 months. Nowadays, if a home is priced correctly, it can be on the market for a very short time.
NL: Any predictions for La Jolla’s real estate market in 2021?
LD: Unfortunately, we don’t have crystal balls. But we do feel as though next year is going to be as active and profitable as it has this year. I think 2021 is going to be a good year, at least in the first half.