By MICHAEL EDLEN | Special to the Palisadian-Post
Six months after the devastating wildfire that swept through our community, some have painted a bleak picture of the Pacific Palisades vacant lot market—predicting that sales would stall, inventory would swell beyond control and prices would spiral downward for years to come.
However, the numbers now tell a more nuanced—and perhaps more encouraging—story.
A Reality Check on Inventory and Sales
Contrary to predictions that over 500 lots might be on the market by mid-year with only a few dozen sold, the actual situation reflects far more activity. As of late June, approximately 210 lots are listed for sale, while more than 80 have already sold. In addition, over 30 more are currently in escrow, indicating consistent buyer interest and ongoing transactions.
At the current pace—averaging around 14.5 sales per month—we now have about a 14-month supply of inventory. Just two months ago, that number was closer to 20 months, suggesting that while pricing has continued to decline, market movement has gained some traction. Furthermore, the current number of lots in escrow represents roughly seven months’ worth of inventory, indicating renewed buyer activity at the right price points.
Price Declines: Real, But Moderating
There’s no question that lot values have dropped substantially since the fire. The average price per square foot of land today is about $287, down from approximately $310 just two months ago. That equates to a decline of about 3.5% per month, a clear cooling from the steeper drops that occurred in the immediate aftermath of the fire.
Still, these are broad averages. Certain neighborhoods have seen values fall twice as much as others. For example, Alphabet Streets lots have experienced deeper declines than those in The Huntington, where larger properties, lower density, underground utilities and much lower degree of devastation make a stronger market.
Diverging Strategies Among Lot Owners
This evolving market has created a split in strategies among lot owners.
Some are selling now, aiming to capture the highest price possible before values erode further. They recognize that in a downward market, pricing just ahead of the trend—typically 1 to 2% below current expectations—can be key to securing a serious buyer. Overpricing by even 5 to 10% may result in weeks or months of stagnation, followed by a sale at a significantly lower level.
Others are opting to hold on, believing that land values will likely rebound once the community rebuilds more fully. For those not planning to reconstruct on their lot, this could be a longer-term investment strategy. However, they must balance this patience with the risk of ongoing price declines and holding costs.
An increasing number of owners are also trading lots, selling their existing property to purchase another that offers better views, more square footage or a superior location—seeking to “trade up” in a buyer-favorable environment.
The Insurance Dilemma
A major factor slowing some lot sales has been the complex process of insurance settlement. Many owners are still negotiating for higher payouts, hoping to recover an additional 10 to 20% beyond initial offers. Unfortunately, waiting for higher insurance proceeds comes with a tradeoff: As they wait, their lot’s market value may decline by 3% or more each month.
For these owners, timing is everything—both in finalizing insurance claims and deciding whether to sell, rebuild or hold.
Navigating a Buyer’s Market
This is clearly a buyer’s market—but that doesn’t mean sellers are powerless. With strategic pricing, strong presentation and thoughtful marketing, vacant lots can and are being sold. However, this is not the time to “test the market” with wishful pricing. Buyers are highly informed and cautious, and many have numerous alternatives to choose from.
Instead, sellers need to consider the broader context: inventory levels, competitive properties, recent sales data and neighborhood-specific trends. With the right approach, they can still achieve excellent outcomes—even in a shifting market.
In Summary
Yes, prices are down. Yes, inventory remains high. But no—the market is not collapsing. In fact, signs of renewed buyer confidence and adjusting seller expectations suggest that the trajectory may be slowing rather than accelerating downward.
This moment represents an important inflection point for our community. Thoughtful decisions, guided by real data rather than fear or speculation, will help each owner make the right choice for their individual situation.
Michael Edlen and his team have been focused on evaluating and effectively selling Pacific Palisades homes and lots. Contact them for more information or to arrange a consultation at team@edlenteam.com or 310-600-7422, Christina Wagner 310-220-9494 and Tatiana Weiss 310-433-3124.
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