Trying to Predict the Future in the Pacific Palisades

When it comes to real estate after the Palisades Fire, a few big questions keep coming up.  Here’s my perspective:

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I own in the Palisades. Should I rebuild? 

Just like almost everything else in real estate “...it depends”. It depends on a lot of things for each individual person’s lifestyle, risk tolerance, environmental health consciousness, but is it a good financial bet? I absolutely think so. 

Palisades is a special location in Los Angeles. It is perhaps the most conveniently located neighborhood that still feels somewhat removed from the city …and it has sweeping ocean views. As you go north along the coast from Santa Monica, real estate values generally trend downward (with the exception of some areas in Malibu that are their own ecosystems). This is mainly because of the drivetime to get back into the city. Palisades being the next coastal city up from Santa Monica makes it a location that really can’t be beat. And the golden rule of real estate is location, location, location. Is there a risk that the Palisades doesn’t recover from this disaster? No shot. The location is just too desirable. 

I don’t own, but I’ve always wanted to live in the Palisades. Should I buy now? 

Almost certainly. Not everyone in the Palisades will rebuild. The last census had 11,446 people living in the Palisades neighborhood over the age of 65 and the fire destroyed 6,800 structures. Safe to say a significant portion of them owned single family homes that didn't survive. I can't speak for everyone, but if I'm retired, have the means to move to a similar area and would have to otherwise listen to a gigantic construction site for years to come - I'm for sure moving. There will be more supply in terms of lots on the market in the coming years than in the last decades and that is just econ 101. It's the time to buy if you want to live in the Palisades in the future and perhaps couldn't because of the price. 

When should you buy a lot in the Palisades? 

As of early April 2025, 18 lots have sold in the Palisades since the fire. The average price per square foot is $332, and on average, these lots have sold for 106% of their list price — indicating competitive demand. Notably, the only sales below list price were for properties listed before the fire began.

Right now, there are 137 lots on the market. The median original list price is $100,000 higher than the current asking price, which suggests sellers are beginning to adjust expectations — and that we’ll likely start seeing more sales below asking as inventory continues to rise.

Trend of Land Listings Over Last Year 

(April 2025) 

In short: prices are trending downward as new lots flood the market. That’s likely to continue until one of two things happens: (1) a meaningful wave of rebuilding begins, or (2) the pace of new listings slows.

Palisades isn't the first market a wildfire has affected and we can look to other recent California wildfire disasters for possible benchmarks. In order to do this I imported ZHVI (Zillow) data for Paradise CA, Sonoma CA, and Malibu CA. I then used Python (and some AI troubleshooting) to make a quick and dirty graph of real estate values and compared them to time surrounding their respective recent disaster events.

Based on recoveries in areas like Malibu (Woolsey Fire), Paradise (Camp Fire), and Sonoma, buyers may have a 12–24 month window where supply temporarily outpaces demand. But relative to those markets, the Palisades has exceptionally high baseline demand — meaning this window could close even faster.