California housing market is hotting up

04.05.16

It’s official - the California housing market is hotting up. So where are overseas buyers staking a second-home claim? Celia Woods investigates

 It’s a talking point boast for many Southern Californians – access to pristine golf-courses, snow-capped mountains and long, lazy beaches all within access drive from the state’s slick freeway network.

But then California has never been shy about vaunting its home-grown assets. It’s the Golden State after all with a climate that is hard to beat not to mention some of the finest addresses on the globe: Hollywood, Beverly Hills, Palm Springs to name a few.

A contender to Florida and a firm favourite with overseas property buyers – the state has felt the recessionary pinch since 2008 with a fall-off in direct foreign investment but, according to Joel Singer of the California Association of Realtors two trends are now starting to emerge. One is a green-shoots rise in home values. “It’s lifting many underwater homeowners — those who owed more in mortgage payments than their homes were worth — providing them with the opportunity to sell. That’s beginning to boost the number of real estate listings.”

The second is a shift in investor behaviour. “For the past three or four years, investors have bought homes and rented them out. Now, they are upgrading them and putting them back on the market — more frequently.”

Adds Joe Leonardi of Prudential California Realty: “One of the biggest drivers of second-home sales is access to outdoor recreational amenities. Buyers can expect to see a greater number of these homes on the market and developers on new properties pushing incentives.”

WHERE TO INVEST

SAN DIEGO

Located 120 miles south of Los Angeles and the second-largest city in the state - 70 miles of coastline offers the perfect base for buyers seeking a front-line beach pad with vibrant communities dotting the northern coast including Carlsbad, La Jolla, Cardiff and Solana Beach. “The average price for a detached family home in San Diego is close to £542,000,” confirms Kathryn Holt of local agents Willis Allen. “For oceanfront property and Pacific views, prices only go up from there.” Situated in Carlsbad just a thirty minute drive from San Diego - La Costa Resort and Spa is selling furnished two-bed residences at £550,000 with access to two world-class golf courses. In nearby Solana Beach, meanwhile SD Luxury Homes is marketing stylish two-bedroom condominiums in the boutique resort of Del Mar Shores. Prices start from £335,000.

MALIBU

Boasting more than 20 miles of coastline with a rugged mountain backdrop, star gazing is a familiar pastime in Malibu where the rich and famous can often be spotted at the local coffee shop.

Learning the local property lingo can take a little time, as Linda Light of Coldwell Banker Realty explains: “Properties are not just ocean view; they have either “white water” or “blue water” views. The more desirable “white water” translates into seeing the waves, while “blue water” means further back looking out at an expanse of blue ocean.

Prices of upwards of £8-12m are not uncommon with sought-after locations such as Carbon and Broad sporting a high concentration of super-prime properties with all the trimmings.”

A less expensive alternative 15 miles down the coast is the boho resort of Santa Monica. Among the quality beachfront offerings listed with Coldwell Banker is a contemporary design three-bed apartment downtown on Ocean Avenue for £595,000.

PALM SPRINGS AND COACHELLA

A veritable desert oasis yet just 100 miles from downtown Los Angeles - Palm Springs and neighbouring Palm Desert and La Quinta in the Coachella Valley have long been known as fresh air getaways for those who love the outdoors, whether on the golf course, by the pool or on hikes in the nearby Joshua Tree National Park. Recently buyers have been travelling from further afield - Texas, the East Coast and beyond North America – with UK and European buyers now a growing market in the investment mix.

Boasting some 120 golf courses, the region is also developing something of a tees-and greens reputation year-round, with four-bedroom mountain Estate homes going for £1m in well-heeled golf communities like PGA West in La Quinta. At the top end is the prestigious Bighorn Golf Club in Palm Desert, with home prices spanning £2m to over £25m.

NAPA

Just 55 miles north of San Francisco, stretching from the town of Napa up to Calistoga, Napa Valley along with its neighbouring towns has a distinctly laid-back feel. You’ll see plenty of rolling hills and vast stretches of vineyards, but the region’s natural assets come hand in hand with a bevy of upmarket eateries, and designer boutiques with strict growth limits, including a virtual moratorium on subdividing land outside of city limits, preserving the area’s heritage.

One true gem of the region is the community of St. Helena. Winemaking began here in the 1800s, its history echoing through the gables and turrets of the Rhine House, now home to Beringer, and gracious carriage house of the region’s first winery, Charles Krug.

“Buyers love the combination of vineyard living with housing stock ranging from affordable Craftsman bungalows to rambling Victorian mansions,” says local agent Gail Morgan Lane. It’s still possible to find renovated traditional homes in town for under £400,000.”

Size Matters

California stands out from other states due to its sheer size. It has the highest population in the US – 38.8m – and covers 770 miles from top to bottom, making it bigger than many European countries.

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