Matthew Woolsey of Forbes.com reports: There’s been a lot of denial among luxury homeowners. In 2006, it was thought that the luxury market wouldn’t suffer the same fate as the broader market. A year later, high-end home buyers were thought to have endless, deep pockets, further insulating the top-tier from the cratering economy. As the nation’s markets in 2008 went from bad to worse, some in the industry claimed that the dearth of trophy properties outstripped supply.
This year, reality set in. No one is buying $100 million homes. Few are buying $30 million homes. Properties in that range are either being reduced by amounts similar to the national debts of small countries–Dunellen Hall, reduced by $50 million from $125 million to $75 million, and BootJack Ranch to $68 million, a reduction of $20 million from last year’s asking–or are being pulled from the market entirely. It’s been a bad year for America’s Most Expensive Homes, our annual list of the nation’s priciest oceanfront mansions, urban townhouses, monumental ski lodges and country estates. Mainstays like the $125 million Fleur de Lys in Beverly Hills, a 45,000-square-foot re-creation of Louis XIV’s palace at Versailles, and the $100 million Tranquility, a Lake Tahoe 20,000-square-foot mountain home on 210 acres, are still at the top of our list, two and three years after they came on the market, respectively.
In 2008, it took a $75 million price tag to make the list. Now there are four homes priced below that: the $68 million BootJack Ranch in Pagosa Springs, Colo., with its 77,000 square feet of cabin space, including a 13,800-square- foot main house, a $65 million Brentwood, Calif., ranch designed by Robert Byrd, a $60 million Beverly Hills mansion built in 1919 by silent-film stars Douglas Fairbanks and Mary Pickford and a $60 million Upper East Side apartment with a mind-boggling 10,000-square-feet of space.
To compile our list, we spoke with brokers and consulted listing agents and real estate appraisers and scoured real estate listings. We didn’t include private listings, also called pocket listings, because they’re quietly shopped around among elite buyers, nor did we measure land sales. The so-called Spelling Mansion, a 123-room Holmby Hills spread, which has reportedly been on and off the market at $150 million is currently not publicly listed and therefore was not included. The penthouse of the Pierre Hotel in Manhattan is also officially off the market.
When did the high end of the market truly fall apart? When the financial crisis set in, particularly after Lehman Brothers failed Sept. 15 and Freddie Mac and Fannie Mae went into government conservatorship on Sept. 7. In New York, and the Hamptons, that completely shut off the sales spigot. “There are only two closed sales above $30 million that I know of,” says Jonathan Miller, principal of Miller Samuel, a Manhattan-based appraisal firm. “There were a few additional sales that closed in September, but they went to contract before the party ended. “It’s the same story on the West Coast, almost 3,000 miles from Wall Street.
“I’m calling peak June, July of 2008, that was the end of it,” says Mauricio Umansky, a broker with Hilton and Hyland in Beverly Hills, who despite the downturn has sold two $30 million homes since the financial crisis set in. “When September 15 hit, that was the boom lowering.”
Of course, if it takes a couple more years to sell the $125 million Fleur de Lys or the $100 million Tranquility, their sellers are most likely willing to wait. After all, these homes been sitting on the market for years, and the amount a broker can make in commission off that kind of sale is enough to retire on.
Perhaps that’s the fifth factor in the high-end market: It only takes one offer.
1. $125 million
Fleur de Lys
Beverly Hills, Calif.
The latest addition to the $100 million-plus club, Suzanne Saperstein’s gem is aptly called the Fleur de Lys. Modeled after Louis XIV’s palace at Versailles, the 45,000-square-foot home took five years to build following Saperstein’s accumulation of five acres in Holmby Hills during the 1990s. Should strolling the grounds bore you, there is a 50-seat screening room and a library filled with first-edition books. Auto collectors will salivate over the nine-car garage.
2. $100 million
Lake Tahoe, Nev.
Conveniently located on the tax-free Nevada side of Lake Tahoe, this 210-acre property is owned by Joel Horowitz, co-founder of Tommy Hilfiger. The 20,000-square-foot main house is modeled after a Northern European mountain home and has a 3,500-bottle wine cellar. An indoor swimming pool and atrium, as well as a 19-seat movie theater, ensure constant entertainment, even if you’re snowed in.
3. $85 million
Bel Air, Calif.
On 2.2 acres in the Bel Air neighborhood, this 48,000-square-foot palace has 10 bedrooms and 14 bathrooms. If you’re worried about the riff-raff sneaking in, there’s a 1,000-foot-long, 36-foot-high wall made of Jerusalem stone that encircles the property. The three-story home sits on a parcel that includes a swan pond, infinity pool and gardens. As part of the L.A. lifestyle, you need cars, and in case you’ve got 20 of them, there’s plenty of parking in this home’s garage.
4. $75 million (down from $125 million)
On 40 acres of rolling hills, with lawns and meadows broken up by tree lines that provide privacy, this Jacobean manor has 21,897 square feet, 14 bedrooms and 13 bathrooms. Vaulted ceilings, travertine marble floors, bay windows, limestone walls and wood paneling are notable interior features, as is a 52-foot-long indoor swimming pool.
5. $75 million
Upper East Side
New York, N.Y.
Rarely, even for New York’s most expensive townhomes, can you find one that’s 45-feet wide, as is the case with this limestone mansion on East 61st Street. The six-story home has 21,000 square feet of space. High, arched ceilings, winding staircases and stone floors mark the entry way. Other features include an interior courtyard, library, garden level, wine cellar, roof terrace, home gym, sauna, six bedrooms, three staff rooms and ten bathrooms.