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On Tuesday, thousands of families were forced to evacuate as fires ravaged homes across Pacific Palisades and Altadena. This disaster sparked a widespread search for housing, with victims navigating a competitive market in search of rental properties or potential purchases.
According to local agents, there is a sense of desperation among the people. Many have lost their homes to devastation and are seeking a stable place for their families — a location that isn’t a shelter, a friend’s residence, or a hotel. In response, some landlords have begun to significantly increase rent prices, exceeding the limits set by temporary price gouging regulations. Additionally, potential renters are resorting to offering a full year’s rent in cash upfront and are even participating in bidding wars.
“Many individuals are competing for the same properties,” remarked David Berg, a real estate agent with Compass. “Since Tuesday afternoon, we’ve received hundreds of calls.”
On Friday, Berg and F. Ron Smith announced the listing of a newly constructed house in Brentwood, conveniently located near the Palisades. Within just an hour of being posted, the listing garnered 10,000 views on Redfin.
Berg stated, "We are working to accommodate many families in various properties, but it's proving to be quite challenging."
The couple put a property in Santa Monica on the market last week. Initially, there was little interest, and no one came to see the house until Tuesday. Since that day, they've conducted seven showings and have already received two offers.
Evan Fisher and his family abandoned their spacious five-bedroom residence in the Palisades. By Wednesday, he and his wife began searching for a rental property in the vicinity to ensure their three daughters — aged 17, 15, and 10 — could continue attending the same school. Regardless of whether their home remains intact — he suspects it might be — he understood that it would be a lengthy process to return, and he aimed to maintain a sense of normalcy for his children during this challenging time.
"Many individuals are working towards the same goal," remarked Fisher, a 49-year-old psychologist.
Fisher browsed through numerous online listings and toured nine properties in person. He has submitted applications for two homes: one located in Bel Air and the other in Beverly Hills.
"Hopefully, one of them will turn out to be successful," he remarked.
The mass exodus caused by the fires has driven prices even higher, with rental properties going for more than their asking prices, according to agents. For numerous individuals, short-term leases, particularly those that come furnished, seem to be the most practical solution. Volunteers have created spreadsheets and compiled lists of available rentals, but many of these options are taken within minutes or hours of being posted.
Compass agent Susan Kastner mentioned that numerous families are racing to secure leases, resulting in every available rental receiving multiple offers.
She had a listing for sale on Las Casas Avenue in the Palisades, but she can’t take offers on it because she’s not even sure it’s still standing and hasn’t been able to check.
For individuals who have experienced the loss of their homes, purchasing a new property—even out of necessity—can be a more logical option. As noted by Smith, certain families are currently getting insurance payments and have the flexibility to use those funds for either renting a place or securing a new mortgage.
"According to Smith, securing an architect and navigating the planning, permitting, and construction phases will probably span three years or longer. As a result, families are weighing their options between renting for three years or purchasing a property right away."
While Malibu and Santa Monica are typical destinations for those leaving the Palisades, Smith noted that many are exploring options in Venice, Westchester, Mar Vista, and even across the pass in the San Fernando Valley.
"According to real estate agent Darby Woods, 'Real estate agents are overwhelmed, assisting families in relocating from Santa Barbara to Palm Springs and throughout South Bay.'"
Woods has a seven-bedroom home up for rent in the Palisades that, save for the pool house, survived the fire. She hasn’t gotten any calls on it — presumably because people are assuming it burned down — so she’s planning to update the listing to clarify that it’s still standing, though probably pretty smoky.
Shana Tavangarian Soboroff, a real estate agent with the Beverly Hills Estates, evacuated from her parents’ Pacific Palisades home Tuesday — where she was staying while her own residence was under construction nearby. Even amid the tumult she was fielding calls from clients searching for new digs in the area.
"I currently have numerous clients who are in search of a replacement," Soboroff mentioned on Wednesday, just a few hours before she discovered that her parents' home had been engulfed in flames.
Soboroff mentioned that she had available listings for four rental properties, all of which were single-family homes, some of which had been on the market for several months. Two of these properties were located in West Hollywood, one in Beverly Hills, and another in Venice. By Friday, all four had been leased, with rental prices ranging from approximately $15,000 to $20,000 per month. She noted that the new tenants were individuals who had lost their homes due to the Palisades fire.
Regarding the listings in Venice and West Hollywood, the properties were rented out at prices that exceeded expectations. However, according to Soboroff, this surge in offers came from tenants who were willing to pay more. “It’s the urgency felt by those who have been displaced,” she explained. “It seems to have escalated recently, with many suddenly realizing they must secure a place quickly. As a result, they’re saying things like, ‘I’ll pay a year’s rent upfront.’ They are attempting to persuade landlords to select them.”
However, two of Soboroff's landlord clients decided against increasing the rental prices for their properties. One such client, personal injury lawyer Andrew Alexandroff, who owns a house in Beverly Hills that Soboroff helped lease, expressed his surprise at the level of interest in his property following the fires. "It felt terrible to capitalize on a disaster," he remarked. "As an injury attorney, I encounter calamity regularly. When individuals are at their most vulnerable, my goal is to assist them."
Soboroff, a Palisades native, mentioned that she is currently assisting around 15 clients, with 13 of them coming on board after the onset of the Palisades fire. She has several properties listed for sale, including one in Westwood and another in Century City.
Other victims are striving to restore their homes as swiftly as they can rather than opting for new purchases, having learned from the pandemic that delays are unavoidable when countless individuals are attempting to renovate simultaneously.
Real estate agent Bret Parsons received a call at 11 a.m. on Wednesday from a client informing him that his father's house had been destroyed in a fire. The client urgently requested contact details for any reputable architects Parsons could recommend. By Wednesday afternoon, less than 24 hours after the tragedy, Parsons had provided seven names, and the client was already making calls to reach out to them.
State price gouging rules took effect Jan. 7 once Gov. Gavin Newsom declared a state of emergency and are supposed to reign in rental costs.
According to the California attorney general's office, under these regulations, landlords are typically prohibited from increasing their charges by more than 10% over the rates they were previously charging or advertising prior to the declaration of a state of emergency.
Real estate agent Michael Nourmand, on the other hand, mentioned that he believes single-family rental listings are currently priced about 20% above what he would have anticipated prior to the fires.
“They're catching on — and fast,” he remarked about the landlords.
The enforcement of price gouging regulations falls under the authority of the state attorney general's office and local district attorneys. Those found guilty of such violations may be subjected to a maximum of one year in prison and hefty financial penalties.
Anya Lawler, a policy advocate at the California Rural Legal Assistance Foundation, emphasized that landlords must adhere to the 10% rent increase limit, even in situations where bidding wars occur and tenants are willing to pay higher amounts. She also noted that enforcement of price gouging regulations is expected to be stringent, as it has been in previous instances.
“I believe some landlords genuinely lack knowledge of the law and are just trying to maximize their profits in a difficult situation,” Lawler stated. “On the other hand, there are those who are fully aware of the regulations and believe they can evade consequences.”
A notable example of rent fluctuation is a four-bedroom residence located on Dellvale Place in Encino. As reported by Zillow, this property was listed at a monthly rental price of $9,000 on January 3rd.
Subsequent to the fires and the declaration of a state of emergency, the rental price on the listing saw a significant increase, climbing nearly 28% to reach $11,500.
During a phone interview on Thursday, listing agent Soheila Mirfakhrai expressed her discomfort with raising the price, yet the owner instructed her to proceed with the increase without providing any reasoning. She mentioned that she was unaware of the price gouging regulations.
Following a phone conversation with The Times, Mirfakhrai reduced the price to $9,800, reflecting an increase of almost 8.9% compared to the rental price requested on January 3.
“He consented to lower the price,” Mirfakhrai mentioned in a message. “I informed him that this was unacceptable, and I would resign.”
Mirfakhrai mentioned that she was prohibited from sharing a contact number for the owner, and attempts to reach the owner for a comment were unsuccessful.
"Heidi Jensen, a real estate agent assisting families affected by the Palisades fire, stated, 'Some of the properties increase the rent by nearly 50%.'"
"I believe it's incredibly unethical and unkind to treat those who are in need this way."