Monday Morning Quarterback

Monday Morning Quarterback

(Monday, August 25, 2025)

California’s oldest structure is a 600-Year-Old Japanese Pagoda in Hollywood. I know, I know, that sounds implausible. But high up in L.A.’s glamorous Hollywood Hills you’ll find an authentic Japanese pagoda dating back to the 14th century, which two brothers imported to their fanciful Asian-inspired estate in the early 1900s. The estate is now a storied Los Angeles landmark and Japanese-inspired restaurant with a compelling past: Yamashiro Hollywood. In the early 1900s, German-born brothers Adolph and Eugene Bernheimer ran a successful New York enterprise importing Asian goods to the States. In 1911, they purchased a Hollywood knoll and began constructing an extravagant estate called “Yamashiro,” designed with a mix of Japanese and Chinese elements. The Bernheimer brothers imported a small, tiered old pagoda from Japan as one of many exciting elements on the property. These days, you can still find the now 600-year-old relic next to the property’s Pagoda Bar and swimming pool. Yamashiro Hollywood asserts. That the pagoda is the oldest structure in California. If the ancient pagoda doesn’t tip you off as to the Yamashiro property’s design, the rest of the grounds are just as remarkable. The brothers decorated the 10-room main house with ornate teak and cedar carvings and gold lacquer and then filled it with heaps of imported Asian art. They adorned the sprawling terraces and courtyard with thousands of plants and trees, exotic animals, koi ponds, waterfalls, a cave-like “Monkey House,” and even a miniature Japanese village. Construction finished on the Bernheimer estate in 1914, just a year after the California Alien Land Law passed. The law prohibited “aliens ineligible for citizenship” from owning or leasing land long-term and was primarily directed at Japanese immigrants. Sadly, the Bernheimer brothers enjoyed only a brief residency at Yamashiro Hollywood. They sold the estate in 1922, after which point the property held a series of curious roles. But fortunately, the pagoda remains.

North Carolina Had A Housing Crisis Before Hurricane Helene; Now It's Even Worse. As the Atlantic hurricane season begins, meteorologists are working to improve forecasting and warnings for the hazard that causes the most hurricane deaths: freshwater flooding. With climate change, storms are becoming bigger and wetter and are bringing large amounts of rain to inland areas, often with deadly consequences. At least 249 people died during Hurricane Helene and its aftermath, according to the National Hurricane Center. Of those, 94 fatalities are attributed to rainfall flooding. More than 100,000 homes were damaged or destroyed in North Carolina, some 500 miles inland from where it came ashore in Florida. Dozens of people drowned in Helene's floodwaters. The director of communications for Buncombe County, Lilian Govus, says, "We all knew that a big storm was coming, but we weren't quite able to grab the attention in the way that we had hoped." Govus hopes archival photos of the 1916 flood publicized before Helene might help warn people about what was coming. It didn't work. Two days before the storm hit, county officials declared a state of emergency and encouraged people in some communities to evacuate. "I think only one media outlet attended that press conference ahead of the storm," recalls Govus. "And so really trying to get folks' attention to let them know how serious this was, was difficult." Many along the River Arts District, known as the “RAD,” a one-mile stretch of artists' studios along the French Broad River in Asheville, did prepare ahead of the storm, says Jeffrey Burroughs, president of the RAD. Burroughs says many artists moved their work to a different location and, "they even went as far as to move things onto the second floor. But who even knew that it didn't even matter?" Because water reached the second floor in some buildings, says Burroughs, "It's terrifying."

Why Millionaires Are Choosing To Rent Instead Of Buy Homes. Buying a home has long been a cornerstone of the American dream, but homeownership isn’t the right financial move for everyone — especially for millionaires who can easily afford it. From 2010 to 2015, the number of millionaire renters tripled, according to RentCafe, signaling a shift in how wealthy individuals approach housing. This trend continued, with data analyzed by the Wall Street Journal revealing that between 2018 and 2024, the percentage of households earning $750,000 or more that chose to rent increased to a record high of 10.5%. While many assume that financial success automatically leads to homeownership, an increasing number of high-net-worth individuals are opting to rent instead. For many, the decision comes down to four key factors: high housing costs, better investment opportunities, lifestyle flexibility and uncertain market conditions:

1. High home prices and mortgage rates make buying less appealing. Being a millionaire doesn’t mean folks are willing to make bad money moves. Right now, mortgage rates are between 6% and 7% for a 30-Year fixed-rate home loan. That’s still impactful on monthly payments. For a millionaire buyer looking at a $1.5 million home, putting down 20% (or $300,000) would still cost them almost $9,000 a month in principle, interest, taxes and insurance payments. And that’s not including utilities or other moving and living expenses.

2. Renting offers flexibility, convenience and luxury. For many high-net-worth individuals, the combination of flexibility, convenience and luxury makes renting a more appealing option than committing to homeownership.

3. Renting frees up capital for better investments. Diversification is key. Some millionaires choose to invest in stocks, bonds and private equity, while others channel their wealth into business ventures or commercial real estate that can generate passive income.

4. Limited supply. Homebuyers at every budget point have ideas of what they want in a home. Millionaires may have more cash to buy a house, but those available homes may not meet their preferences. At the end of 2024, Freddie Mac reported a 3.7 million-unit housing shortage, even as our economy was on the upswing.

Identifying New Affordable Housing Locations. As the need for affordable housing looms over Los Angeles, affordable developments are planting roots in some of L.A. County’s traditionally more affluent neighborhoods and cities. West Hollywood, Pasadena and Marina del Rey are among those seeing new affordable housing developments – areas with 8%, 18% and 62% higher median household incomes than the county overall, respectively, according to Data USA. Whether it’s a shift in public perception, increased empathy, efforts to meet state and local demands (or some combination) these projects are entering the local pipeline. Welton Jordan, chief real estate development officer at EAH Housing, has observed the growing trend in his 12 years at the San Rafael-based nonprofit developer which focuses on affordable housing in California and Hawaii. “We’re definitely seeing a lot more people noticing and wanting to talk about (affordable housing) and understanding the importance of everybody needing somewhere to live,” Jordan says. “As society is starting to get older… I think some of these issues are coming more to the forefront than maybe they had in the past.” Nevertheless, some communities are more accepting than others, Jordan says. Currently, EAH is in the construction phase for two affordable housing developments in West Hollywood: Lexington Gardens at 1201 N. Detroit St. which will have 47 studio apartments reserved for people making between 30% and 60% of the county’s area median income (AMI); and Marigold West at 1041-1049 N. Martel Ave. which will have 50 units of studio, one-, and two-bedroom apartments reserved for seniors and individuals with special needs also earning the same AMI. Additionally, half of Marigold’s units will go to those with permanent supportive housing vouchers through West Hollywood’s Affordable Housing Trust Fund, the city partners with nonprofits like EAH on projects. In addition to municipal support, Welton says neither project received backlash or pushback from the West Hollywood community.

U.S. Median Home Price Hits Record High. Even with home sales at a historic low, prices continue to rise — adding hundreds of dollars to monthly payments so far in 2025. In July, the median price for an existing home in the U.S. reached a record high of $435,300, according to the National Association of Realtors (“NAR”). That’s up 2% from a year ago and marks the 24th straight month of annual price growth. While more homes are being built, “multiple years of undersupply are driving the record high home price,” says Lawrence Yun, NAR’s chief economist, in a blog post about the data. “Home construction continues to lag population growth.” Rising prices, combined with mortgage rates above 6.5%, have pushed many buyers out of the market, says Yun. Homeowners are also reluctant to sell, since just over half of them have mortgage rates under 4% per NAR. As a result, home sales in the last two years have fallen to their lowest sustained levels since the early 2010s. Even so, limited inventory and continued demand from more affluent buyers (many of whom can pay in cash) have kept prices climbing. If you buy a median-priced home (outside of California) with a 20% down payment and a 30-year fixed-rate mortgage at 6.81% (the average rate, per Mortgage News Daily) your monthly mortgage payment alone will be about $2,273. That’s $139 more than in January, when the median home price was $396,900 and average rates were slightly higher, averaging around 7.1%. Back then, the monthly mortgage payment would have been about $2,134. Of course, not everyone pays the median home price or qualifies for the same rate. It’s also important to consider the cost of property taxes and homeowners insurance, which vary widely by location. These can be around 1% of the total mortgage cost per year, which can add hundreds of dollars to monthly payments for a median-price home. Unfortunately for buyers, mortgage rates aren’t expected to fall much in the rest of 2025 — and with limited supply keeping prices elevated, high monthly costs may be the norm for a while.

The Burj Khalifa Penthouse. Given that it’s located in the world’s tallest building, it should come as no surprise that the Burj Khalifa penthouse is among the highest residences in the world—and the home is now for sale for $51 million. “The views from the penthouse are nothing short of spectacular, and every direction offers a reminder that you’re in one of the most iconic buildings in the world,” Asad Khan, the listing agent and CEO of Invest Dubai Real Estate, tells Architectural Digest “You can watch the sunrise over the desert or see the city come alive as the sun sets, all from the comfort of a home that feels like a private sanctuary in the sky.” Offering uninterrupted 360-degree views of Dubai, the Arabian Gulf, and the surrounding desert, the unit spans 21,000 square feet across the building’s 107th and 108th floors. It stands roughly 1,300 feet above the city and includes floor-to-ceiling windows to take in the sky-high views (nosebleed included at no cost). Currently, the penthouse includes a private elevator and indoor swimming pool. In addition to the Burj Khalifa’s amenity package, which includes a lounge, fitness center, spa, infinity pool, and co-working space, the home also comes with 12 parking spaces. Karl Haddad, the CEO of IRC Invest, is the seller. He purchased the unit in 2020 for an undisclosed amount from Mohamed Alabbar, a founder of Emaar Properties, who developed the Burj Khalifa. Khan says he wouldn’t be surprised if the buyer ends up being from the United States. “We’ve had a huge amount of interest from Americans including business elite, sports agents, and Hollywood agents,” he adds. Though the Burj Khalifa penthouse is the tallest residence in the building, there are 50 additional floors above it. A number of these stories hold maintenance facilities and corporate offices, though there are also some publicly accessible spaces. “At.mosphere,” the tallest restaurant in the world is located on the 122nd floor of the building while observation decks are spread across the 124th and 125th floor.

Vendors Expo Returns! Our world-famous "Vendors Expo" returns in 2025, on Thursday night, September 11, 2025. The Vendor Expo opens starting at 6:30 pm. We'll have 30+ of the finest vendors featuring real estate products and services you will want to utilize as a successful investor. Our Vendor Expo will be held at the Iman Cultural Center, 3376 Motor Avenue (between National and Palms), Culver City CA. FREE Admission. Please RSVP at our website, LARealEstateInvestors.com.

"You Go Girl." Both men and women invest in real estate. But honesty, women have certain “challenges” that men just don’t have to think about. (Men, you may have no clue what we’re referring to, but women know exactly.) So please join us at the Los Angeles County Real Estate Investors Association September meeting, Thursday night, September 11, 2025, 6:30 to 9:30 pm, where you will learn how to confront these challenges and become a successful real estate investor. This month we have a unique panel of four women who are kicking butt in Real Estate? These women have been in the trenches, confronted and conquered challenges, and know how to swing a hammer (though they’ve learned they don’t have to). And that’s what they will share with you. Their stories are as different as their personalities, but they all share two things in common: They are successful at what they do and they earn a good living doing it! Attend and learn what advantages women have when investing in real estate. (Men; you can attend too, but at your own risk.) This joint event with the Women's Real Estate Network ("WREN") is always our largest attended event of the year! Don't miss it!

Marqués de Riscal Hotel. The photo at the top of this week’s Quarterback is the Marques de Riscal Hotel. Also known as the Marqués de Riscal Vineyard Hotel, this incredible piece of contemporary architecture is a luxury hotel located in the wine region of Bodegas Marquis de Riscal, Elciego, Spain. It is part of The Luxury Collection. The hotel was designed by the incomparable Frank Gehry using methods previously employed in the Guggenheim Museum.

This Week. Looking ahead, investors will continue watching for additional information about tariffs and monitor comments from Fed officials for hints about monetary policy later in the year. For economic reports, New Home Sales will be released later today. Consumer Confidence will come out tomorrow. Personal Income and the PCE price index, the inflation indicator favored by the Fed, will be released on Friday.

Weekly Changes:

10-Year Treasuries: Fell 005 bps

Dow Jones Average: Rose 600 points

NASDAQ: Fell 100 points

Calendar:

Monday (8/25): New Home Sales

Tuesday (8/26): Confidence

Friday (8/29): Core PCE

For further information, comments, and questions:

Lloyd Segal

President

Los Angeles County Real Estate Investors Association

Lloyd@LARealEstateInvestors.com

www.LARealEstateInvestors.com

310-792-6404