Luxury home values climbed dramatically in Los Angeles and San Diego and approached record levels in San Francisco in the first quarter of 2004, according to the Prestige Home Index by First Republic Bank.

Los Angeles values jumped 17.9 percent compared to the first quarter of 2003 and 7.3 percent from the fourth quarter of 2003. Average luxury home values in Los Angeles climbed to $1.66 million, surpassing the previous record set in 1990.

San Diego values were up 15.1 percent compared to the first quarter of 2003 and gained 3.5 percent from the fourth quarter of 2003. San Diego values increased to $1.64 million, the fourth consecutive quarterly record.

San Francisco Bay Area values rose 8.3 percent in the first quarter of 2004 compared to a year ago, and 5.8 percent from the fourth quarter of 2003. Average values reached $2.37 million, just short of the $2.39 million record high set in the second quarter of 2001.

“Luxury home values in California rose sharply in the first quarter of 2004 due to strong demand, limited inventory, an improving economy and concern that interest rates, which are still low by historic standards, will continue to rise,” said Katherine August-deWilde, chief operating officer of First Republic Bank. “All three urban California markets are very strong.”

First Republic Bank, a NYSE-traded commercial bank and wealth management company, produces the Prestige Home Index each quarter with Case Shiller Weiss, a provider of automated property valuation services and home price metrics to U.S. financial institutions.

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