By MICHAEL EDLEN | Special to the Palisadian-Post
Ten months after the devastating wildfire, the path toward recovery remains uneven—yet hopeful signs are beginning to appear. While emotional and financial challenges continue to weigh heavily on most owners, the real estate market for vacant lots has started to show encouraging signs of growing confidence.
From Shock to Adjustment
In the first few months following the fire, uncertainty reigned. We all had a flood of questions about insurance coverage, rebuilding requirements, environmental safety, concerns about the state of our infrastructure, difficulties in grappling with politicians and how to begin again.
Many are still emotionally unprepared to make major decisions, while others have hoped for clear guidance from city and county agencies that has been slow to come.
By late spring, a few buyers—primarily local residents or investors familiar with the area—began exploring opportunities among the newly vacant parcels. Early lot sales reflected slightly discounted prices, but by the summer prices were often 45 to 50% below pre-fire values. This initial wave of transactions helped establish a baseline for what the market would bear under such extraordinary circumstances.
A Market Finding Its Footing
Now, as we are at the 10-month mark, activity levels in some neighborhoods have shifted noticeably. More buyers are coming forward, and the volume of lots going into escrow has increased each month. Many are recognizing that today’s prices could represent the low point in the cycle.
With roughly similar numbers of new listings and pending escrows in recent months, supply and demand have begun to balance, helping prices firm up. While average lot values remain well below 2024 levels, the steep downward trend appears to have leveled off. In some sections of the community, multiple offers have even re-emerged—something unthinkable just six months ago.
Why So Many Still Haven’t Rebuilt
Despite this modest rebound in the land market, the pace of rebuilding remains slow. Less than 10% of property owners have yet submitted full plans for new homes, and the number of completed permits is still relatively low.
Several factors are at play:
- Insurance uncertainty: Most policyholders are still negotiating final settlements or dealing with shortfalls between coverage limits and actual rebuild costs. Many have been advised to take no action until legal settlements for losses have been made.
- Construction costs: Even with an ample supply of contractors, total build costs remain far higher than most of us anticipated—often exceeding $800 per square foot for quality custom work.
- Emotional fatigue: After losing a home and facing months of bureaucratic and logistical challenges, many people are simply not ready to start the process again. Some are families who now have established roots in other communities and are questioning returning to the Palisades.
For many of us, there’s a confidence that the community will stabilize in several years—and that once enough homes rise from the ashes, confidence and momentum will return.
The Role of New Buyers
Meanwhile, new types of participants have entered the local market. Some buyers are investors with construction expertise, confident that by building now they’ll gain a strong return in several years. Others are new investors, hopeful that they will be able to build a few homes here and earn a good profit. Others are families who see the community’s long-term appeal—its views, schools and location—and are willing to endure short-term inconvenience for the chance to live here.
This infusion of new energy is helping to jump-start the recovery. Every new foundation poured restores a bit more of visible hope to the community.
Looking Ahead
Realistically, full recovery will take years. Infrastructure repairs, permit delays and the ongoing insurance crisis in California all present real obstacles. Yet market psychology can shift quickly. Once people see tangible progress—driveways being poured, landscaping returning, neighbors moving back—confidence spreads.
It’s important to remember that communities hit by catastrophic fires elsewhere have gone through similar cycles: initial despair, deep value declines, tentative optimism and eventually a resurgence. Within several years, we can anticipate that the rebuilt neighborhoods will experience a steady increase in values, thanks to modern design, safer infrastructure and renewed community spirit as the local population grows once more.
A Time for Realistic Optimism
For property owners still deciding what to do, this may be a good moment to reassess options with clear eyes. If rebuilding feels overwhelming now, holding the lot may still be viable—the downward pressure on prices seems to have eased. If selling, it’s worth understanding that buyer confidence is improving and competition is slowly returning.
Above all, this remains our community—one that will deal with challenges on the path to recovery. As rebuilding continues, each new home and business becomes a symbol of resilience and a reminder that even after devastating loss, neighborhoods can rise stronger than before.
Michael Edlen has been a local resident for 50-plus years and has already begun rebuilding. He and his team are available for consultation about the options property owners or potential buyers are considering. You can reach them at 310-600-7422 or team@edlenteam.com.
