What Dictates Pacific Palisades Land Values in a Post-Fire Market?

In response to our “Ask Us to Cover a Topic” section, an owner recently asked for guidance on what might constitute a “low-ball offer” on a parcel of land. While we can look at how wildfires have historically impacted different real estate markets, none of those examples are perfectly comparable to Pacific Palisades. One important reason is the scale of the infrastructure damage here and the time it may take to fully rebuild.

Historical Precedents: Lessons from Tubbs and Woolsey

Still, several studies and past fire recoveries provide helpful context, including the Woolsey Fire, the Tubbs Fire, the March 2025 UCLA Anderson School of Management study on the Palisades and Eaton Fires, and an International City/County Management Association (ICMA) study of the economic impacts, rebuilding, and disaster recovery after large wildfires.

One particularly relevant point from the ICMA study is the importance of a clear recovery plan, including debris removal. The study notes that lingering debris affects both physical health and mental health. It is no coincidence that more Palisades owners listed their lots as debris removal was wrapping up. That influx of active listings put downward pressure on prices toward the end of the summer and into the fall of last year.

The Fountaingrove area of Santa Rosa provides an interesting case study following the October 2017 Tubbs Fire, which destroyed approximately 5,636 structures and burned about 36,800 acres. Immediately after the fire, vacant lot prices reportedly dropped 30–40% from pre-fire values, which is very similar to what we saw in the Palisades. After approximately 12 to 18 months, lot values began to stabilize, though they remained roughly 15–25% below pre-fire levels.

By 2 to 3 years after the Tubbs Fire, rebuilt homes were selling at or above pre-fire values. By years 3 to 4, the neighborhood saw a meaningful increase in value, driven by new construction, updated building codes, modern amenities, and improved fire-safety features.

The November 2018 Woolsey Fire had a different but also useful recovery pattern. The fire destroyed approximately 488 structures in Malibu and burned nearly 97,000 acres across Los Angeles and Ventura counties. In the first six months, raw land values in burned areas initially declined by an estimated 15–20% on average, while properties with intact structures generally held value more steadily. Severely burned neighborhoods experienced temporary declines, but oceanfront and view properties were more resilient.

By mid-2019, land values in Malibu began recovering. Some burned lots even sold at premiums because they offered new building opportunities. Areas with improved fire mitigation infrastructure recovered more quickly, and properties with ocean views remained stronger throughout the recovery.

The takeaway from Woolsey is that while fire creates real short-term disruption, highly desirable coastal markets tend to be resilient. UCLA Anderson made a similar observation in its study of the Palisades and Eaton Fires, noting that areas impacted by the Woolsey and Thomas Fires, with prime locations, Pacific Ocean views, and mild weather, share similarities with Pacific Palisades. The study concluded that historical trends suggest Pacific Palisades home values could continue to rise over the long term.

So before labeling today’s offers as “low-ball,” it helps to understand where we are in the recovery cycle… and whether Pacific Palisades is still in decline, beginning to stabilize, or already entering its next phase.

Today’s Market: Pricing, Lot Stabilization, and Buyer Risk

So what is driving the market we are experiencing? The answer lies in both market fundamentals and owner psychology.

The Palisades Fire destroyed approximately 5,550 residential structures across Pacific Palisades and Sunset Mesa, as part of more than 6,800 total structures lost. To date, more than 560 fire-impacted properties have sold, and permit activity continues to increase across 90272. While the various dashboards measure activity differently, the broader trend is clear: rebuilding is underway, and momentum is building.

Last summer, we saw land values decline approximately 25–40% from pre-fire values when comparing pre-fire teardown sales to post-fire parcel sales. Since then, lot values have stabilized. The market now appears to be mirroring the Tubbs recovery pattern: we are in the 12-to-18-month window where values begin to stabilize and the pre- to post-fire value gap narrows, in many cases, to approximately 15–20%.

So, are today’s offers low-ball offers?

Not necessarily. Some offers may feel low compared to pre-fire values, but if they are within the current post-fire market range, they may reflect today’s risk, uncertainty, and timing rather than opportunism. Buyers are factoring in infrastructure timelines, permitting risk, construction costs, insurance concerns, financing limitations, and the emotional and practical uncertainty that still surrounds the rebuild.

Strategic Choices for Landowners and Long-Term Recovery

At the same time, many owners believe that because they have settled elsewhere and do not intend to rebuild, holding their parcel may be the financially sound decision. Property taxes may be relatively low, insurance proceeds may have reduced or paid off a mortgage, and for some, land banking the property for children or grandchildren makes sense as a matter of principle.

That may be true for some owners. For others, depending on their insurance coverage, mortgage position, age, cash-flow needs, tax considerations, and emotional bandwidth, it may not be the best decision. We have been in conversation with countless owners who are evaluating these exact questions, and we welcome the opportunity to help property owners think through their options during these highly unusual times.

We strongly believe that once infrastructure is rebuilt, Pacific Palisades will recover, even if some aspects of its character have been altered. This community has always carried forward its history, from the Methodist Episcopal community that settled the Alphabet Streets, to the families and Boomers who helped shape the Riviera Country Club and the broader village by the sea.

We remain confident that, as infrastructure returns and rebuilding progresses, Pacific Palisades will recover and continue to be one of Southern California’s most desirable coastal communities.