Malibu is defined by sun and sea, but it is also home to some of the most expensive real estate in the country. It has been built-up for decades, so there isn’t really anything affordable within walking distance or easy driving distance of the beach. On the other hand, this has led to a building boom of luxury real estate in the area. But what makes the finest properties in Malibu stand out from the crowd?
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The Premium You Pay for Access to the Water
Demand for real estate in Malibu is so great that a starter home is officially a luxury home, since it costs more than one million dollars. Fortunately, Malibu has 27 miles of coastline. You’ll pay several times more for a house or condo that lets you walk to the water or gives you an unobstructed view of the ocean than one that doesn’t. You’ll pay yet again in the form of sky-high property insurance premiums. But people will pay whatever it takes to be near the beach in Malibu. Work with Malibu real estate agents to find your real-life dream beach home.
The Premium You Pay for Proximity to Nature
Malibu has many canyons and dedicated parklands. The main benefit of this is a large amount of open land for hiking or simply appreciating it. The downside is that it means there is less land available for construction, driving up real estate prices. Furthermore, development in most of the city is determined by the California Coastal Commission. In general, that prevents development unless you’re tearing down a single-family home and building a low rise apartment building or replacing an older home with a new, luxury single family house. Note that even though these homes may not be subject to flooding, Malibu is in a high fire zone, so any home here comes with high insurance premiums.
This impacts the Malibu real estate market in several ways. First, it means you may pay even more for a home that backs up to a canyon and has views of the water. Second, it has resulted in many luxury homes perched over various canyons and lookouts.
The More Diverse Pool of Real Estate Buyers
Malibu has many more out-of-area buyers, both from within the United States and from around the world. Many people buy these homes as second, third and fourth homes. They may be vacation homes or investment properties. In fact, these two categories are often blurred. Property owners can earn a lot of money renting out an oceanfront villa when they aren’t there. All of these factors add up into a larger pool of luxury home buyers bidding up premium properties. When desirable luxury homes come on the market, they sell fast.
The Impact of Utilities
Most Malibu properties rely on septic systems. This is because there are only two or three neighborhoods connected to the city sewer. There is certainly a benefit to not having to worry about storms forcing sewage into your home or going through the hassle of having the septic tank in front of your luxury home pumped. On the other hand, California’s environmentalist ethos means that you can find many homes with solar panels or even with zero emissions.
