The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS

2020 REAL ESTATE MARKET INSIGHTS • 1 My Start... I Love HISTORIC HOMES Historic Estate I sold in Westport ...and I have spent 20 plus years dedicated to our past, imprint them with today’s culture and finding, selling and helping conserve these conserve them for future generations. properties. I grew up and currently live in an “Old House” and I love them for many reasons. 2020 has been unprecedented, to say the least. At a fundamental level, these antiques have a What was expected Coldwell Banker President quality of materials, often handmade, as well as and CEO M. Ryan Gorman described in the craftsmanship rarely found in new construction. Global Luxury Report: “The year 2019 was From the pegged and grooved floors, to transitional for the high-end property market. hand-formed red clay tiles and decorated U.S. recession fears and concerns about a with iconic details such as Batchelder tiles or Historical Society, global economic slowdown eventually gave Judson Studios glass, these homes are unique, where I lectured and way to cautious optimism.” Instead, the global one-of-a-kind gems. And their styles range volunteered pandemic has led to a real estate boom. from the high architecture by masters such as Wallace Neff, Paul R. Williams, Frank Lloyd I created this Historic Homes LA report to Wright, Greene & Greene, Richard Neutra, etc, not only share my love of historic homes, but to the vernacular, some from kits and many a to provide data and perspective about these mix of updates and additions to answer an residences that, as a Realtor, I am in a unique owner’s taste or needs. They give us a wonderful position to have. Does historic preservation hurt world of visually interesting streetscapes and a home’s value? For this first time we have a the opportunity to live in one-of-a-kind homes. definitive answer. How has COVID-19 impacted They are also an amazing opportunity to historic home values and who is a likely historic actually live in and be a part of history. I don’t home buyer? Meridith Baer, founder of Meridith believe in “moth-balling” these homes, but I Baer Home explains how to stage an antique do believe in working with them to understand home. And, there’s more….I hope you enjoy it.

2 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 3 Inside THE HISTORIC HOME REPORT

PRESERVATION8 10 14 18 22 28 Sold! Millennial’s: Meredith Baer Heritage Meet Pays! SALES DATA YOUR NEXT BUYER 5 TIPS FOR HILARY STEVENS FOR 10 HPOZs STAGING Conservation OPPORTUNITY + HISTORIC HOMES and the JOYCE REY TEAM ADAPTATION

4 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 5 6 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 7 PRESERVATION Pays! DO HOMES IN HPOZs HAVE A PRICE ADVANTAGE? I have been involved with marketing, selling and The price advantage held true during the housing conserving historic/antique homes throughout crisis. While neither nor historic my 20-year real estate career. And the multi- homes were immune to 2007-2010’s national real million dollar question I am asked, regardless estate crisis, the decline in value from the top whether I’m in Los Angeles, New York or to the bottom of the market was slightly less in Connecticut is: does a historic designation and/ HPOZs than the rest of city. Notably, the recovery or location in a historic district add or diminish from the crash was stronger and more consistent the value of a house or neighborhood? I’ve sat in these areas too. through countless presentations at National Trust for Historic Preservation conventions and The biggest concern behind the valuation planning department meetings on this question. question is the fear of city planning department The answers always focus on quality of life issues: regulations. Many potential buyers and historic often means more “human” scale, less development advocates mistakenly believe that commute times in urban areas, aesthetic value, home values are suppressed because of the craftsmanship, history and culture. While all limitations placed on historic homeowners. Unless enter into contracts with homeowners to provide homeowner agrees to a specific plan to maintain, of these have intrinsic value, they are not the a home has a very rare, high level designation property tax relief and reductions, provided restore and protect the property and to allow objective dollar-and-cents answer the questioner such as landmark, the only limitation on HPOZ historic structures are restored and maintained inspections by city and county officials. The city desires. At least not until NOW! owners is the design review process through LA’s following Department of the Interior standards. may impose penalties if the contract is breached. city planning department intended to conserve The savings may be substantial because the The Los Angeles Conservancy recently released the property as seen by the public. If the added appraised valuations for Mills Act properties are A homeowner in Los Angeles must apply for a the Preservation Positive Los Angeles 2020 layer of regulations lowered property values it based upon an Income Approach rather than Mills Act reduction through the city’s Office study. The report found that owning a home in would be seen in both lower values and a slower standard Market values. of Historic Resources. The annual application Los Angeles is a desirable asset, even more so if rate of change over time. The LA Conservancy process begins in January and homeowners the property is located in a Historic Preservation study clearly demonstrates that property values The contract is executed between the property must propose a preservation plan in order to Overlay Zone (HPOZ). The study analyzed 136,000 in HPOZs appreciate at a greater rate than the owner and the city for a revolving ten-year term be considered and approved for a property tax single-family home sales from 2000 to 2016. The rest of the city. and is transferred to new owners if the property reduction. Contributing structures in a HPOZ and report found housing in HPOZs outperforms the is sold. It is binding to all successive owners. The designated City of Los Angeles Historic-Cultural city average. From 2007 to 2010, the average Owning a historic home may have another contract automatically renews each year so the Monuments are among the buildings eligible for sold price per square foot in HPOZs was slightly economic advantage due to California’s Mills Act. term always remains ten years. In the contract, the this program. more than 13% higher than the rest of the city. The Mills Act is a 1972 state law allowing cities to

8 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 9 Sold! SALES DATA FOR 10 HPOZs

ANGELINO CARTHAY CARTHAY HANCOCK MELROSE MIRACLE MIRACLE SPAULDING WINDSOR WINDSOR HEIGHTS CIRCLE SQUARE PARK HILL MILE MILE NORTH SQUARE SQUARE VILLAGE PRE-COVID

MED SALES PRICE 2019 $1,000,000 $1,950,000 $1,495,000 $2,859,000 $1,416,000 $1,615,000 $1,795,000 $1,800,000 $2,450,000 $1,480,000

AVG. $/SF 2019 $703 $770 $783 $907 $529 $741 $759 $927 $885 $689

AVG. DAYS ON THE 34 DAYS 49 DAYS 40 DAYS 50 DAYS 63 DAYS 43 DAYS 30 DAYS 37 DAYS 62 DAYS 43 DAYS MARKET IN 2019

DURING COVID

3.15.2020 - 8.31.2020 $950,000 $2,040,000 $1,550,000* $2,200,000 NO SALES $1,695,000 $1,718,000 $1,692,000* $2,020,000 $1,650,000 MEDIAN SALES PRICE

COVID AVG. $/SF $938 $776 $823* $891 — $2,081 $850 $1,162* $850 $680

*Only 1 sale between 3/15 and 8/31/2020 Note: The Multiple Listings Service suspended the tracking of days on market during late winter and spring 2020.

10 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 11 12 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 13 Millennials: YOUNG BUYERS YOUR NEXT APPRECIATE BUYER HISTORY TOO!

When you decide to sell your home, a Millennial essential. And 56% say a home’s tech capabilities (adults between ages 24 to 39 in 2020) may well are more important than curb appeal. If you are be your buyer. This group accounted for 25% thinking about selling a home in an HPOZ, think of buyers in 2019, the largest generational pool about upgrading the technology as much as for the seventh consecutive year. They were also possible-- if you haven’t already. the largest generational pool of sellers (at 19%) according to the National Association of Realtors. Older homes in established neighborhoods appeal Many delayed marriage and parenthood; for several reasons. The quality of the neighborhood however, now 67% are married and 61% live in a is very important to 68% of Millennial buyers. household with children. Schools are also important: 46% of respondents noted the importance of the quality of the Millennials are very attracted to antique homes. school, while 38% selected the convenience to a A Los Angeles Conservancy study found that school. More urbanized areas also have appeal, as more than half of millennial buyers purchased a 41% say commuting costs are a consideration. (I home built before 1913; and 44% bought a home expect this to change due to COVID-19; please, built between 1913 and 1961. In fact, Millennials see corresponding article on page 22). account for 9% of owners in HPOZs vs. 7% outside historic districts. And, LA ranks sixth in places where Millennials want to live per realtor.com.

Millennials crave uniqueness and will trade size for it: 43% according to a Better Homes & Gardens’ survey. They don’t want what they perceive as the “cookie-cutter luxury” home that their parents desired. That same study found a “light” fixer is preferred by 33% of Millennial buyers. Technology is also incredibly important. The survey found 84% said advanced residential technology (such as energy efficient washer/ dryer, smart thermostats and security systems) is

14 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 15 16 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 17 5 tips

FOR STAGING #4: ACCESSORIZE SIMPLY

HISTORIC HOMES Don’t go overboard with selecting accessories for the sake of styling. I’ve walked into many homes where the accent pillows just seem to have been collected over the years without any real thought. For the faint of heart, it’s as simple as keeping a monochromatic story - pick a color that’s a few shades deeper than the upholstery, mix in some texture #1: DE-CLUTTER! by Meridith Baer and suddenly your room will feel more cohesive and decorated. Bring attention to the unique details by hanging a piece of artwork, or a vase of flowers near the charming When prepping to stage any home, the best elements of the home. For example, style built-ins with books, flowers and carefully first step is to de-clutter. For a historic home chosen objects. you want to keep the items that make the home #3: HIGHLIGHT THE feel historic – antique lighting and fixtures, any BEST FEATURES elements that provide original character, etc. At the same time, you can remove additional #5: CONSIDER SCALE + SIZE items (newer furniture, family heirlooms and photos, collections from your travels, and so on) Oftentimes historic homes may have irregular shaped rooms- do a trompe l’oeil. Play up the that don’t fit the aesthetic. You want the homes optical illusions at your disposal, a mirror or Lucite pieces like bedside or coffee tables can be historic qualities to speak for themselves – and your saving grace for giving the suggestion of grandeur. A large mirror mounted on the wall adds want to remove any distractions that take away architectural interest while also adding light to the space—it works especially well if it reflects a from those qualities. window or large opening into the room to give the illusion of more space.

#2: BRIGHTEN IT UP

Often historic homes can be poorly lit. You can easily brighten up a dark room with a fresh coat of white paint, but be sure not to paint over Stay true to the home’s character in how you unique historic features, like beams, molding or select furniture and accessories. Many historic decorative tiles. Put in new light bulbs if there are homes have incredible wood or tile work. Don’t any light fixtures that add to the home’s charm cover up the floor with a rug (unless there’s (think vintage chandeliers, sconces, etc.), and stained carpet!), clean it from top to bottom and consider adding floor and table lamps in areas select neutral colors for larger items like sofas, that could use them. Give the floors a good chairs, and beds. For example, if there is unique washing, and consider re-finishing if the floors woodwork in a bedroom, select an understated are unsightly and very noticeably aged/worn out. headboard that matches the woodgrain.

18 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 19 20 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 21 Heritage Conservation OPPORTUNITY + ADAPTATION BY BUYERS, ADVOCATES AND ORGANIZATIONS

HERE’S THE GOOD NEWS: Conserving , demonstrated that in our historic residential inventory really depends 2018, the Federal Historic Tax Credit generated on buyers and owners desiring these properties $7.7 billion in rehabilitation investment—75% and putting the time, effort and dollars in to care of which went to projects in economically for them, to preserve them for future generations distressed communities—and created 129,000 and to make them work for today’s lifestyle. The jobs. This tax credit does not apply to individual pivot towards working from home has slammed private residences but is a valuable incentive for up against the development of Millennial’s developers of large projects, including residential. becoming a huge buyer pool and that’s been good for antique homes. Many arts and culture organizations are struggling as their revenue models have been Look no further than Instagram to see the challenged with stay-at-home orders, social popularity of distressed historic properties. distancing and economic hardship. I know how Cheap Old Houses (with 1.2 million Instagram razor-thin budgets for small, local conservation/ followers) presents houses across the U.S. with preservation organizations can be. In Westport, to sell tickets to the museums as well as a spring historic Wright site visits on an ongoing basis. The asking prices capped at $100,000 (renovation Conn. where I began my real estate career, I also fair, holiday house tour, lecture series and a gala. National Trust for Historic Preservation has online budgets not included). Today’s buyers impacted served on the board of the historical society. tours of historic places and recently featured LA’s by the pandemic and staying at home now have We cared for several historic buildings that own Southwest Museum, Historic Communities of time for these kinds of rehab projects, while were open as museums: the Bradley-Wheeler Facing uncertainty with in-person activities the 710 and the Japanese American experience working remotely makes the dependency on House, built in 1795, which was remodeled in the curtailed, preservation organizations and historic via Huntington Beach’s Historic Wintersburg tour. getting to the office moot. Locally, vintage homes Italianate style in the 19th Century and is listed home museums have moved programming hold appeal: 50% of millennial buyers bought a on the National Register of Historic Places, the online to virtual events. In Los Angeles, the LA Conservancy continues its important work virtually: house built before 1913 and 44% bought one Connecticut Register of Historic Places as well as The silver lining may be that these and built between 1913 and 1961. a Historic Landmark; Cobblestone Barn, built in the non-profit expanded its digital presence other online efforts help widen the pool 1865 and is unique in the state of Connecticut and strengthened its legacy-business program devoted to raising awareness of endangered of historic preservation advocates— MORE GOOD NEWS: Statistics and studies with its eight-sided roof, that was used as a dairy; historic and iconic businesses when LA restaurants confirm that preservation is an important tool for and Adams Academy, a 19th Century, one-room our best defense against demolition began closing during the shutdown. Frank Lloyd economic revitalization and recovery. Per ADPRO, schoolhouse. Our budget, and ability to conserve and neglect of historic properties! Wright’s (closed since March) a report released by Rutgers University and the these gems, was largely based upon the ability now offers a virtual visit and participates in

22 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 23 24 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 25 26 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 27 Meet Meet the HILARY STEVENS JOYCE REY TEAM

Hilary has lectured on historic preservation issues WITH NEARLY $5 BILLION IN SALES, JOYCE REY LEADS and historic home ownership; she holds a Historic AN AWARD WINNING TEAM KNOWN FOR REPRESENTING Property Specialist designation from the National DISTINGUISHED PROPERTIES WITH THE HIGHEST LEVEL Trust For Historic Preservation. A valued member OF PROFESSIONALISM AND CREATIVITY. of the award winning Joyce Rey Team, Hilary has a loyal clientele of buyers and sellers due to her dedication to their best interests. With 20 years of real estate experience, she is a skilled negotiator and marketer. Skills that come from 15 years in marketing and advertising for global luxury brands, after earning an MBA in marketing from Columbia University’s Graduate School of Business and a BA in Communications at UC Berkeley.

Hilary is an active member in the Windsor Square- Hancock Park Historical Society, The Ebell Club, the Institute of Classical Art & Architecture and the Costume Council of the Los Angeles County Museum of Art. She supports the National Trust for Historic Preservation as well as the Los Angeles Conservancy. She continues to learn and stay up-to-date on all the zoning and regulatory issues regarding renovating historic homes; she recently completed an intensive course of study at USC School of Architecture’s Heritage Conservation program.

28 • The HISTORIC HOME REPORT 2020 REAL ESTATE MARKET INSIGHTS • 29 HILARY STEVENS

CA BRE # 0179533 301 N CANON DRIVE | BEVERLY HILLS, CA 90210 CELL 310.776.0688 | OFFICE 310.281.3941 [email protected] WWW.HILARYSTEVENS.COM 30 • The HISTORIC HOME REPORT