M
artin Johnson and his fiancé Celeigh Chapman had spent years restoring their Altadena home by hand, only to lose everything in hours last week. "We didn't have a kitchen for a year and a half," said Johnson, who co-owns LA Woodshop. They were weeks away from finishing the house when it was destroyed.
The couple is now facing a difficult housing market in Southern California, where thousands of families are scrambling to find new homes. They've been staying with friends since evacuating, dealing with stress and anxiety that's made it hard for Chapman to sleep.
"We'll find something," said Johnson, but acknowledged they may have to compromise on their living situation. "If it ends up being a lifestyle downgrade for more money is difficult to say."
Real estate agents agree that the sudden surge in demand for housing will drive prices up. Los Angeles agent Brita Kleingartner said, "We were already in a housing crisis... Now there's an overwhelming demand, and we're just starting to see what that looks like." Some rental units are seeing price hikes of hundreds or thousands of dollars per month.
The market was already tight, with fewer than 30,000 homes sold last year in Los Angeles County. The estimated 10,000 homes lost to the fires will only exacerbate the shortage. "Demand is going to be through the roof," said Jeremiah Vancans, another LA agent.
Restoring the city's housing stock will take at least three to five years, according to real estate agents. In addition to higher prices, those who lost their homes may face cash offers from "predatory buyers" seeking to take advantage of their financial situation.
A study by Redfin found that property prices can actually fall in the short term after a wildfire, but this decline doesn't last. The average price for property can increase due to new construction and homeowners investing in fireproofing measures.
The market had already been tight, with fewer than 1% of homes being sold last year. Now, an estimated 10,000 people are added to the buying market, making it even more competitive. "In the past five years it's been bidding-war city," said Brock Harris, a real estate agent. "Any house that was under $2 million was getting 10-20 offers."
