Recent wildfires in Los Angeles County put more than $40 billion in real estate value at risk, according to a new report from realtor.com®’s economic research team.
Since the Eaton and Palisades fires started in Jan. 7, their boundaries have expanded to include more than 15,800 residential properties, with a total value of $40.3 billion.
The average home within the boundaries of the Eaton fire has an estimated value of $1.3 million, while the typical home in the boundaries of the Palisades fire has an estimated value of $3 million.
The county’s median home value is somewhat lower than both affected areas, at $870,500.
It is worth noting that not every house within the perimeter of the fires was necessarily destroyed. Also, a significant portion of the total property value in Los Angeles is in the land itself, which means that a home reduced to rubble can still be worth millions based on the lot’s value.
The cost of rebuilding all properties within the fire, including commercial property, is estimated by CoreLogic to exceed $13 billion.
The new analysis shows the extraordinary scale of the destruction and the task of rebuilding ahead. Although largely contained, both fires are still burning.
Residents within the Eaton and Palisades fire boundaries make up 0.9% of Los Angeles County’s housing stock by number and make up 2% of the county’s total property value.
So far in 2025, about 100 homes have been listed for sale within the boundaries of the Eaton and Palisades fires, the new analysis found.
Those listings in at-risk areas account for about 1.3% of all active listings of homes for sale so far this year in the county, slightly higher than the area’s share of overstocked housing stock.
It was already experiencing a housing shortage
Over the past decade, new family formation in the Los Angeles metro area has outpaced single-family home construction by more than 2-to-1, new analysis found.
Between 2013 and 2023, the area added roughly 290,000 new households, but issued only about 107,000 single-family building permits, a gap of nearly 200,000 homes.
The gap is perhaps wider than the data suggests, as limited housing supply and high housing costs determine the formation, the study notes.
Rising apartment rents have helped offset the housing shortage. In the past decade, approximately 220,000 multifamily permits were issued, adding significant rental inventory to the market.
However, limited supply and strong demand for housing in has kept competition fierce and house prices high.
The average list price per square foot has climbed throughout the data’s history (again in mid-2016).
In 2024, there were approximately 36.1% fewer homes for sale compared to 2019.
Displacement from the fires is expected to put a strain on rents
Rents in the Los Angeles metro area in December were already the fourth highest in the country, behind New York City, Boston and San Jose, CA.
The median asking rent for a 0-2 bedroom home was $2,750. That figure was down 2.7% from a year ago, and asking rents have seen weak growth in recent years on a steady supply of multifamily completions.
In line with weaker rental growth, rental vacancy was 5.9% in the third quarter of 2024, its highest level in 10 years.
The slack in LA’s rental market will help accommodate those emerging from the fires — but second only to the new question of living space, rents are likely to rise.
So far this year, realtor.com® traffic to Los Angeles rental listings from local residents has grown twice as much as traffic to remote listings across the country.
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