October is Luxury Month on Inman. Inman Handbooks offer deep dives on luxury marketing and agent branding, luxury staging, referrals, and more. We’re thinking about what luxury means now, examining how the pandemic is reshaping the needs of luxury buyers, and talking to top luxury agents, all month long.
The last few months have been eventful for Jason Oppenheim and the other stars of “Selling Sunset.”
After the third season of the Netflix reality show was released in August, the founder of the Oppenheim Group and his team of female agents experienced a spike in popularity, with agents Heather Rae Young and Chrishell Stause each drawing more than 1.5 million followers on Instagram during one of the most tumultuous years Los Angeles real estate has ever seen.
“I think that we’re finally starting to see a trend away from a hyper-focus on square footage and toward quality of life,” Oppenheim told Inman. “That means security, privacy and land.”
We recently caught up with Oppenheim to talk about L.A. home prices, what buyers want now, future plans for the reality series and the Oppenheim Group in general.
Inman News: How has the Oppenheim Group been doing since the third season of “Selling Sunset” aired in August?
JO: The real estate market has picked up quite a bit since then. We’re all back at the office and things are back to normal, if not busier than normal.
Luxury real estate has managed to thrive despite both the virus and the recession. The only thing that has been disrupted is the pool of international buyers, right?
That’s never really been a significant part of our market. International buying dried up years ago and been replaced by domestic consumption. The Russians and the Saudis were buying up a lot of properties about seven to eight years ago, but the recent travel restrictions have not affected the market because domestic consumption has increased so dramatically.
Does part of that have to do with residents from colder cities not wanting to weather a winter amid the pandemic?
There are a lot of different reasons. I’m seeing a lot of people from L.A. also spending a lot of money on homes. The 1 percent is having a pretty good run at it. I think it’s going to be a few months before we see New Yorkers move out here. That’s a pretty big move for them. I think most are still hunkering down and will probably move in 2021.
There’s certainly been pent-up demand that was caused by COVID but it’s really local demand. Ninety-five percent of the sales that we’re seeing right now is local demand.
For what types of houses? The lower range of the luxury price point seems to have the most activity around it.
Yes, the $2 to $3 million price point is the one that’s moving the fastest, and that’s largely driven by interest rates and pent-up demand. The $3 to $6 million is moving but it’s very price-sensitive. If you don’t come on the market really well-priced, you’re still going to sit.
It’s more of a sellers’ market in the $2 to $3 million price point but it’s a neutral or buyers’ market in the $3 to $6 million.
And anything above usually has a trajectory independent from regular markets.
It gets a little bit more nuanced. There are certainly buyers in the $5 to $15 million price point, but they are looking for a deal and making sure they are getting a good price. Any sellers out there who still think they can dictate prices, their homes are sitting. The developers that are realistic and just want to get on with it are seeing their properties sell.
Is having the best amenities as important as people have been making it out to be?
I don’t actually believe this to be the case. Land is doing really well right now. I think that land was being disregarded over the last 10 years as people placed an almost obnoxious focus on square footage.
I think that we’re finally starting to see a trend away from a hyper-focus on square footage and toward quality of life. That means security, privacy and land.
Outdoor space is what makes a property valuable and a long-term investment. As I tell my clients, the house depreciates and if you’re only focusing on the house itself, you’re not thinking like a long-term investor.
But then why do so many get drawn into what’s inside the house?
I think people got enamored by the glamour of these contemporary spec homes over the last few years without realizing that the value of these properties does not always come from what’s inside. Outdoor space is the best investment in real estate, period.
I’m not suggesting that people necessarily get smaller homes, but I think that the hyper-focus on square footage is obnoxious and pointless, in terms of an investment. If that’s what people want for quality of life, great, but it is not what will make a home go up in value.
Can you give Inman a scoop about a possible Season 4 of “Selling Sunset?”
No, I really can’t. We’re not able to say anything definitive about it. And that’s not to mention the fact that the pandemic has disturbed filming in the L.A. area in general.
So what can you tell us about your next moves? You mentioned in some past interviews with other outlets that you were considering international locations. Is that still the case?
I don’t know how practical that is given the fact that I’m hyper vigilant and like to micromanage things. My most likely next endeavor is Newport Beach, Corona del Mar. I don’t think I’ve told anyone that yet.
You want to tap into a hot market?
I just really like the area. I find myself down there often but we’re also getting a lot of listings down there. We just got two more listings this week. There are a lot of people from L.A. looking at Newport Beach and vice versa.
There is a lot of conflux between the two areas so for a lot of different reasons, it makes a lot of sense. I wouldn’t be surprised if this happens by early 2021.
The pandemic means more people have been watching TV and, consequently, “Selling Sunset.” Has it been cool to see your popularity and recognition grow?
It’s been tremendous for business and we get a ton more exposure for properties. We’re getting calls from buyers and sellers all over the place. We’re getting a lot more listings.
We have a ton of agents following our listings, millions of views to the website and our social media platform to market properties. It’s great for our existing clients because of the exposure we provide, and it’s also great in terms of attracting new buyers.