LOS ANGELES (CBSLA.com) — It looks like Powerball arrived in California just in time.
The average price of a luxury home in Los Angeles County rose 7.1 percent in the first quarter of this year, compared to the first three months of last year, according to a study released Wednesday.
Luxury homes, of course, are already out of the reach of most homeowners. And according to the study they are getting even more expensive at a rapid rate.
The cost was also up 1.9 percent over the previous quarter, which covered the final three months of 2012, according to First Republic Bank’s “Prestige Home Index.”
In the first quarter of 2013, the average cost of a luxury home in the Los Angeles area was $2.1 million. That is the highest median rate in nearly four years,
That $2.1 figure compares to $1.7 million in San Diego and $2.8 million in San Francisco.
“Limited inventory exists in many areas, and buyer demand is accelerating for properties in the most desirable neighborhoods,” said Katherine August-deWilde, the bank’s president and chief operating officer.
She added, “Many homes have received multiple offers and are selling over the asking prices.”
Billy Rose of The Agency in Beverly Hills, said the first quarter of this year was “on fire.”
“The market was driven by real confidence in the economy, foreign buyers and wealthy people who no longer want to hold off buying homes,” Rose said. “Pent-up demand and a lack of inventory resulted in true competition in the market.”
Carolyn Johnson, of Prudential California Realty, said “100 eager buyers” flock to open houses in Malibu and Pacific Palisades.
“Last year, people who wanted to buy thought there was going to be more inventory, but that hasn’t materialized,” she said. “People are realizing that it is time to get into the market. The economy and optimism are definitely on the upswing.”
In Los Angeles County, the “Prestige Home Index” tracks sales of luxury houses in Arcadia, Beverly Hills, Calabasas, La Canada Flintridge, Encino, Los Angeles, Malibu, Marina del Rey, North Hollywood, Pacific Palisades, Pasadena, Playa del Rey, Santa Monica, Studio City, and the West Los Angeles enclaves of Bel Air, Brentwood and Westwood.
First Republic Bank produces the index each quarter with Fiserv CSW Inc., which provides automated property valuation services and home price metrics to U.S. financial institutions.