Laguna Beach Has Highest Number of Price Reductions in O.C.

High-end luxury homes—those priced at $1 million or more—in Orange County are still slashing their prices after months on a slow market. And not surprisingly, more than half of them are located in Laguna Beach, one of the slowest markets of all.

In the month ending November 5th, 110 million-dollar homes in Orange County have had to lower their prices. Of these, 56 were located in Laguna Beach, 24 in San Clements, and 30 in Dana Point—notably all on the prestigious South Coast.

Twenty of these homes were priced above $5 million across the three cities. The biggest drop is on an oceanfront property on 2665 Riviera Drive, Laguna Beach, originally priced at $40 million but now going for $31 million.

Data from Aliso Viejo-based firm Altera Real Estate shows that homes under $1 million have an expected market time of 1.89 months, while those above six figures spend an average of 9.27 months in the market.

Altera broker Steve Thomas explained that the difference stems from the lack of demand. The range, he said, represents 29% of the active inventory but only 8% of the demand—that is, buyers willing and able to buy these luxury homes.

Market times are even slower for homes above $2 million, he added. There are currently 1,039 homes in this range, where the expected market time is close to a year—what Thomas calls a “crawl,” which often signals the need to further cut prices.

Experts believe that sellers and their agents are drastically cutting their prices in a bid to avoid the crawl expected to arrive this fall and winter, when home buying normally stops until the start of the new year.