A million dollars doesn’t mean what it used to for Southern California home shoppers.
Sure, drive 2 hours east, and you’ll find a palatial pool home in Hemet on almost an acre of land, lushly landscaped with a koi pond, gazebo and 14 types of fruit trees, including plums, apples, guava, nectarine and banana. It sold March 4 for just under $1 million.
Near the coast in Santa Monica, however, all you get for $1 million is a tiny one-bedroom, one-bathroom condo.
There was a time when real estate agents placed luxury estate signs on their million-dollar listings, said Kristin Pierce, owner and CEO of Century 21 Lois Lauer Realty in Redlands.
“Nowadays,” she said, “a $1 million house is not what it once was when you put that sign on.”
In dozens of Southern California neighborhoods, that seven-figure price tag is good for little more than a starter home, for “a diamond in the rough” or for houses needing repairs costing as much as $150,000.
Even humble tract homes from the 1930s, 40s and 50s routinely emerge from bidding wars with a sale price of $1 million or more.
In March, Orange County became the first county in the region to see its median home price pass the million-dollar milestone.
At $1.02 million, the county’s median is almost as high as the Bay Area, said Ralph McLaughlin, chief economist for the housing website Kukun.
“What we’re seeing is the San Franciscazation of Orange County as far as home prices are concerned,” McLaughlin said.
But Orange County isn’t alone.
In March, 127 out of 419 Southern California ZIP codes with 10 or more sales had a median of $1 million or more, according to CoreLogic figures provided by DQNews. They include neighborhoods from Woodland Hills to Laguna Hills, from San Gabriel to Santa Ana.
At $6.15 million, Santa Monica’s 90402 had the priciest ZIP code in Los Angeles, Orange, Riverside and San Bernardino counties.
Beverly Hills and its famous 90210 ZIP code ranked second with a March median of $4.1 million, followed by Newport Coast at $3.83 million.
Los Angeles County had 86 ZIP codes at $1 million or more, 25 of them within the city of L.A.
Orange County had 39 ZIPs at $1 million or more, and there were two in Riverside County. Alas, San Bernardino County had none.
In parts of the region, houses for under $1 million are almost as rare as four-leaf clovers. The region had 159 Southern California ZIP codes where the single-family median topped $1 million.
The high price of housing comes just as — and, in part, because — millennials are reaching a life stage where they want a bigger home.
Some are racing to buy before mortgage rates go higher.
But those unable to afford a million-dollar price tag are looking for townhomes and houses to rent, said Scot Wild, a senior vice president for Irvine-based John Burns Real Estate Consulting. The real estate industry is responding by building or buying up houses to use as rentals.
John Burns consulting tracked more than $53 billion invested nationwide in single-family rentals since March of 2020. And that’s only the amount that’s public.
Wild estimates that 26%-27% of Southern California’s single-family homes are being bought by investors.
“As mortgage rates jump, it makes affordability even worse,” Wild said. “Big picture, there are more people who are going to be renting.”
At the same time, almost two years of double-digit price gains generated an enormous windfall for existing homeowners who have watched their home values rise like hot-air balloons.
The region’s typical median-priced home had an average gain of $51,000 per year for the last five years.
In Anaheim, the 93-year-old house John Jackson and Kathie Jones bought for $685,000 in June 2017 just sold in nine days with a $1.1 million price tag. If the couple got their asking price, they will reap a $415,000 gain in less than five years, less commission, closing costs and the $250,000 they spent fixing it up.
“When we bought this, we thought the bubble would burst at any minute, and it hasn’t,” Jones said. “How much higher can it go?”
To get an idea of what $1 million buys, we looked at a sampling of million-dollar sales and listings from throughout the region.
It’s no surprise that the farther east you go, the more house you get for the money. The farther west you go, the smaller and older the homes get.
Here’s what we found.
Fullerton: $1 million
An original three-bedroom, two-bathroom one-story house in the Raymond Hills neighborhood, this 1,628-square-foot house was built in 1955 and sits on a 7,729-square-foot lot.
It has baby-blue tile bathrooms, freshly white-painted walls and refinished hardwood floors.
The home was listed March 2 at $899,000 and was under contract six days later after getting 18 offers. The sale closed April 4 at $101,000 over asking.
The median house price in this home’s ZIP code was $907,000 in March, DQ News figures show.
“Fullerton is one of the most in-demand cities in Orange County,” said listing agent Adam Brett Freilich of Reliance Real Estate Services. “The primary reason for that is schools.”
A spacious, one-story, four-bedroom, 3.5-bathroom home on three-quarters of an acre has 3,846 square feet and a three-car garage.
Located on a cul-de-sac with an electric front gate, it has a pool, spa, a wide variety of fruit trees, a vegetable garden, a gazebo and a bridge stretching over the koi pond.
Inside, it has tile floors, vaulted ceilings, wood trim and cabinetry and a large kitchen with granite counters.
The median house price in this home’s ZIP code was $445,000 in March. The new owners moved from Los Angeles, said listing agent Nikki Raasveld, of Reliable Realty Inc. in Temecula.
“They couldn’t touch this in L.A. for a million bucks,” Raasveld said.
A million-dollar price tag in the Inland Empire used to guarantee at least 5,000 square feet, custom amenities, an acre of land, a view and a pool, said James Monks, sales manager at Riverside-based Windermere Tower Properties. Today, million-dollar houses in the two-county region typically have 3,000-4,200 square feet, some customization, half an acre and a pool.
Santa Monica: $1 million
One of 48 condos in the 13-story, Oceanaire condo tower on Ocean Avenue, this unit is within walking distance of the beach and Montana Avenue restaurants and cafes.
The building, designed by L.A. architect A. Quincy Jones, was built in 1963 and once was the home of actor William Holden.
The contemporary ground-floor, one-bedroom, one-bathroom unit is filled with natural light, has an open floor plan, floor-to-ceiling glass walls and sliding-glass doors, wood floors and a large patio. It measures 1,178 square feet, according to Zillow, with stainless steel kitchen appliances, granite countertops and open shelving.
Just 13 units in Santa Monica’s 90402 ZIP code have sold for $1 million or less in the past year, according to Redfin.
Woodland Hills: $1 million
This “eclectic” three-bedroom, two-bathroom house with 1,786 square feet in the west San Fernando Valley is about a half-mile from the Warner Center. The sellers had lived in the home built in 1954 since 1989.
The home’s sellers sought $979,000 but sold for $1 million, said listing agent Barry Shapiro of Keller Williams Exclusive Properties in Simi Valley. The median house price for this ZIP code was $640,000 in March.
According to the listing, it has a sunken family room, hardwood floors and French doors leading out to a covered patio.
It also has a vintage O’Keefe and Merritt stove and a brick front porch.
Anaheim: $1.1 million
A one-story, four-bedroom 1 ½-bath Mediterranean-style house on a corner lot in the historic Anaheim Colony has a tile roof and a bricked front porch.
The house, built in 1929, has a walled-in yard, a backyard pool and a one-car garage opening onto a back ally.
The 2,143-square-foot house originally belonged to Dora Pearson, the mother of Anaheim’s longtime mayor, Charles A. Pearson, who lived around the corner, according to listing agent Meghan Shigo of Century 21 Award.
The house is eligible for the Mills Act property tax credit program.
The home, with an updated kitchen, came on the market April 12 and was under contract within nine days after getting three offers, Shigo said.
“There are compromises with old houses,” she said. “Unless they’ve been added onto, old houses don’t have primary bedrooms, so it’s not going to have a bathroom or typically a walk-in closet. It won’t have the open floor plan. But it’s a fine tradeoff for … a neighborhood that’s as diverse and walkable as this one.”
A four-bedroom, three-bathroom house in the Mountain Meadows neighborhood of Pomona, sits just east of a golf course, Frank Bonelli Regional Park and Puddingstone Lake.
The 3,079-square-foot, two-story house on a quarter-acre has a tile roof, a three-car garage and a spa and pool overlooking a wooded hillside. The master suite has vaulted ceilings and a large bathroom, according to the listing.
The median house price for this home’s ZIP code was $661,000 in March.
The house went on the market just before Christmas and sold on Feb. 1 at $10,000 above the asking price.
However, the house “had a lot of issues,” said listing agent Ty Wallace of Coldwell Banker Tri-Counties in Diamond Bar. The pool and heater need refurbishing and the roof leaks. If it had been all fixed up, it would have sold for $1.15 million, Wallace said.
“It needs $150,000 worth of work,” he said.
Chino Hills: $1 million
A three-bedroom, 2 ½-bathroom two-story house with a view and a backyard pool went on the market Feb. 18 and was under contract in 10 days with 20 offers.
It sold in March for $150,000 over the asking price.
If it didn’t have a pool and a large, private backyard, it probably would have sold for around $800,000, said listing agent Fei Weng of Re/Max Edge in Diamond Bar.
Weng called it a typical Chino Hills tract home, although at 1,425 square feet, the house “is on the small side.” The lot is 6,800 square feet.
According to DQ News, the median house price in this home’s ZIP code was $1 million in March.
“We put it on the market. The next day we had offers. We didn’t even have an open house,” Weng said. “It’s just a crazy market.”
Valley Village: $999,000
This small house on a corner lot in the San Fernando Valley sits across the street from the Ventura Freeway and just west of the Hollywood Freeway.
Yet, the one-story, 1939 house with just two bedrooms, one bathroom and 1,461 square feet listed for almost $1 million.
Were it one block further from the freeways, it would fetch about $1.1 million to $1.2 million, said listing agent Cam Walker of Better Homes and Gardens Real Estate Town Center. The all-home median price for this home’s ZIP code — which includes parts of Toluca Lake and Universal City — was $2.4 million in March.
The home has nice features including a breakfast nook that sits between the kitchen and living room and a flow-through fireplace that simultaneously heats both the family room and the living room.
It had three or four offers, including interest from some investors, and went under contract on Tuesday, April 26, according to Redfin.
“We would love to see a mom and pop and families get the home, and they’re tearing their hair out because they can’t compete,” Walker said.
Irvine: $1.1 million
A modest two-bedroom, 1,475-square-foot home in Irvine with only one owner since its completion in 1978 went under contract less than a week after listing for $1.1 million.
Three or four years ago, its value was around $700,000.
The listing described the single-story home with a vaulted ceiling as “a diamond in the rough.”
Located on a 5,000-square-foot lot in the walled-in Northwood subdivision of Shady Hollow, it has no homeowner association fees. The house is just around the corner from a kid-friendly park and close to an elementary school.
“This type of home would be what we call a starter home, even though it’s now a million dollars,” said Gerry Giannini of Seville Properties, who co-listed the home with Tim Carr at Villa Real Estate.
The house had seven offers by Monday, April 25.
The all-home median price for this home’s ZIP code was $1.41 million in March.
SCNG staff writer Brian Whitehead contributed to this report.
Source: Orange County Register