Sellers at home in their luxury

Alicia Robinson

The frenetic pace of home sales may begin to slow in the coming

months, but at least one local real estate firm expects the

impressive gains it saw in the luxury home market in 2003 to

continue.

First Team Real Estate’s sales of homes valued at $1 million and

up increased 124% in 2003 and the numbers for the first quarter of

2004 will be equally impressive, said Debbie Lewandowski, director of

First Team’s luxury homes division.

Those gains have been driven by a number of factors, including a

shift of wealth as baby boomers inherit money, the rise in prices due

to the scarcity of properties for sale and the low interest rates

through 2003, she said.

Other real estate dealers have seen the same boom.

“It’s really been an outstanding market, not only in the lower

price ranges, which are sensitive to the interest rates, but in the

luxury marketplace,” said Steve High, president of Strada Properties

in Newport Beach.

For First Team, the biggest contributor to the growth of luxury

home sales has been the huge budget the firm has devoted to the

million-dollar market, First Team President Cameron Merage said.

“We’ve basically been very focused on it and dedicated to it and

allocated a lot more resources to it in the past year than ever

before,” he said. “The high-end market has enjoyed substantial growth

in the past several years, so we wanted to be in front of it as

opposed to behind it.”

The firm hired Lewandowski, spent $4.5 million on advertising and

even trained sales associates in negotiation techniques to assist

buyers from different cultures.

The luxury market is one of the fastest-growing segments of the

real estate business in California, Lewandowski said. Very few homes

have been available in recent months, but the number of listings is

now starting to grow, she said.

Merage said he expects First Team’s luxury division to keep

growing in the foreseeable future, but others said an impending rise

in interest rates will have a chilling effect on sales.

Interest rates are expected to start rising between June and

August, but will still be at historic lows, said Bill Ashmore,

president of Impac Mortgage Holdings Inc. in Newport Beach.

“I think that what we may see is just a leveling off,” High said.

“A market like the one we’re in can’t continue forever and ever.”

Summer is typically an active time for home sales, but after that

the market will likely cool off, said Bob Chapman, Orange County

general manager for Prudential California Realty.

“There could be a slowdown in the market based on interest rates

and an increase in supply,” he said.

* ALICIA ROBINSON covers business, politics and the environment.

She may be reached at (949) 764-4330 or by e-mail at

[email protected].