-- Like many homeowners selling in a stubbornly depressed market, Candy Spelling didn't get her asking price.
Her 14-bedroom, 57,000-square-foot mansion in the Holmby Hills section of west Los Angeles was on the market for 28 months — at $150 million, the priciest private home ever listed in the United States. Spelling eventually accepted $85 million from Petra Ecclestone, the 22-year-old daughter of British billionaire Bernie Ecclestone.
If Spelling is feeling seller's remorse unloading The Manor, she is hiding it well. "At the time it was listed, $130 million was the bottom line. If market conditions had been better, maybe I would have gotten more," says Spelling, who pocketed another $6 million from Ecclestone on artwork and furnishings after closing the sale this summer.
In a market where the housing bust has rippled through all price points, few entertainers, athletes, business tycoons or other well-heeled sellers are willing to share details about their pains or gains. But nowhere are the price cuts sharper — or more visible — than in the super and ultra-luxury markets, where prices, depending on location, range from the $15 million to $50 million-plus.
Overall home prices in 20 major markets are up slightly from 2010 over the four-month period ending in July, but values remain about 30% or more off their 2006 peak, according to Standard & Poors Case-Shiller Home Price Index. Some high-end home prices have been battered by 50% or more. As the threats of a double-dip recession and another swoon in financial markets linger, high-end homes stretching from Beverly Hills to Park Avenue languish on the market.
Investment banker William Chadwick sought $65 million for his Malibu, Calif., estate in 2008. The price was slashed to $35 million, then the estate put up for auction Sept. 18 — a rarity on a stretch of known as billionaires beach, where property owners include Oracle CEO Larry Ellison and DreamWorks co-founder David Geffen. Opening bids for Chadwick's estate were set at $22 million, 66% off the initial asking price.
"We don't have a deal yet," says Tony Fitzgerald of Premiere Estates Auction, which is overseeing the Chadwick sale after the recent auction of an Austin estate for $6.2 million — 64% below 2009's $17 million list price.
Fleur de Lys, the Versailles-style estate of Spelling's socialite neighbor, Suzanne Saperstein, has been on and off the market since 2005. Asking price: $125 million.
Some deals are still eye-popping. Actress Jennifer Aniston recently sold her Beverly Hills estate for $35 million — 17% below the $42 million asking price — within four months of listing it. (Her ex-husband Brad Pitt sold his Malibu home for $13.5 million, 25% less than the $18 million he first sought in 2009.)
But frequently even steep price cuts fail to attract interest. And many newer listings reflect the somber reality of lower values, a glut of luxury homes and an absence of deep-pocketed buyers.
Actor/producer Mark Wahlberg's Beverly Hills home, for example, was listed at $16 million in 2008. It recently came back on the market for less than $14 million. Sharon Stone's Beverly Hills home, on and off the market several times, is priced at $9 million, 28% below its 2006 listing at $12.5 million.
Lower prices haven't helped move other properties, such as Michael Jackson's former Bel Air rental, Le Chateau d'Or. It's priced at $30 million, 25% off 2010's $40 million asking price.
Wrestler Hulk Hogan's Florida mansion, listed at $25 million in 2006, is still on the market, for just under $9 million. Singer/songwriter Carole King's Robinson Bar Ranch, a 128-acre spread in Idaho's rugged Sawtooth National Recreation Area, was listed at $19 million in 2006, then dropped to $16 million this year earlier before being cut again to $11.9 million. Weight-loss queen Jenny Craig is trying to shed her 228-acre equestrian estate near San Diego; it's listed at $25 million, down from $30 million last year.
Except for pockets of prosperity, the high-end market "is absolutely dead across the board. There's a three-year supply of inventory," says Fitzgerald, a veteran Los Angeles broker. "Newer condos are down 50% from what they were selling at. There are stretches where they're off, 60%, 70%. I don't see any light at the end of the tunnel."
Neither does King's real estate agent, Sun Valley, Idaho-based Stoney Burke of Hall and Hall, whose ranch listings include a 1,750-acre spread near Wyoming's Grand Tetons on the market for $175 million.
Burke has weathered several recessions and depressed markets over nearly a 40-year career.
"In the past, the very best properties would flat line for two or three years and go back up in value," he says. "This time, despite substantial price cuts, things are different. The buyers aren't there."
At these prices, "you're dealing with billionaires vs. millionaires, but every buyer wants to feel like they're getting a discount," says Sally Forster Jones, the Coldwell Banker agent who co-listed Spelling's home.
Moreover, even the well-heeled are jostled by gyrations on Wall Street and overseas markets. "The daily ripples in the economy can have an impact. I just had a listing that fell out of escrow because of what was happening in the European financial markets," Jones says.
New York-based Realtor Raphael De Niro says that although sales picked up during the summer, prices remain below 2007's peak. And another Dow selloff could send the real estate market reeling because area sales are heavily influenced by Wall Street.
Caught 'with their pants down'
Observers such as Mark David, whose clever, often snarky Realestalker is among the most widely read and exhaustively reported blogs on celebrity real estate deals, notes that although it remains a buyer's market, interest is tepid.
"There are fewer celebrities buying the massive, $20 million mansions," David says. "Part of this is the whole economic comedown. They're affected by all the same things that affect everyone else. When you have a lot of money, you can pay a premium. But they aren't making as much as they used to. And there's a little more modesty in their choices. The market that still sells are the $6 million (to) $10 million properties."
Some celebrities have a knack for turning a profit. Others have owned for so long that they have amassed ample equity. Spelling and her late husband, TV mogul Aaron Spelling, spent less than $25 million on The Manor's 6-acre parcel and building the 123-room home during the 1980s.
Relative newcomers and late-blooming "flippers" who bought near the market's peak aren't as lucky.
"There are people who are good at flipping, and people who consistently lose," David says. "In this market, some got caught with their pants down. I still see prices coming down. And many, many foreclosures" for prominent homeowners. (Among the recent ones: actors Nicolas Cage and Burt Reynolds, singer Toni Braxton and former NBA star Allen Iverson).
Moreover, a celebrity home can attract plenty of attention on the market, but it's not always positive.
"You get a lot of tire-kickers and screwballs who can be a pain in the butt," Burke says. "You get people who get off making calls about an executive ranch, and it turns out they're living in a double-wide in Topeka."
De Niro has parlayed some of his celebrity ties to success at Prudential Douglas Elliman, selling more than $600 million in property since getting his broker's license in 2004. As the son of actor Robert De Niro and actress Diahnne Abbott, he also has a bead on actors, musicians and athletes.
Because of their notoriety, realtors say celebrity sellers think their property is worth 20% more.
"Typically, there is no premium, unless you're Jackie O or there's historical value," De Niro says. "Selling is easier. The one issue is press. When you put it on the market, you make a price reduction, it's all scrutinized and chronicled."
Potential buyers also have privacy concerns, De Niro says. "There can be a lot of handlers and intermediaries — sometimes, six or seven people. Or someone is being tailed by paparazzi. They'll rush through a showing because they're so distracted."
De Niro also has a potentially tough client — his folks. De Niro listed their West Village townhouse — Abbott's former home — for $14 million in July. "I was concerned how I was going to handle it and some of the attention it was going to get, but there's no trepidation from my parents," he says.
There was some needling about his commission, however.
"We'll cut whatever deal we need to," De Niro says. "They tend to be pretty reasonable."
Privately shopping celebs' homes
Many celebrity homes are sold as "pocket" listings — off the grid of multiple listing services to maintain privacy and thwart stargazers. Others are acquired in relative anonymity, purchased through trusts.
"A lot of homes are shopped around in ways you never hear about," David says. "Sometimes celebrities have an accountant, manager or agent in common, and there are many transactions from those in the same social and business networks that are a world unto itself."
"There is that fine line between getting attention and maintaining your privacy," Jones says. "Some love it and want to be in the limelight, others don't want anyone knowing what they're buying or selling."
Realtors also must deal with quirky sellers. Jones, who has been selling high-end properties such as Spelling and Jackson's former homes for more than 30 years, was surprised to learn how she got Spelling's co-listing.
"Unbeknownst to me, (Spelling's) dog Madison assisted in the process. She liked me," Rogers says. "Since then, I've tried extra hard being nice to every pet on a listing appointment."
Actress Julie Newmar, famous for her mid-1960s portrayal of Catwoman on TV's Batman, has owned investment properties for years, including a small apartment building. Her neighbors in Los Angeles' Brentwood section have included Rita Hayworth, Orson Welles and Sally Field.
"Every few years, real estate takes a dump — and this is kind of a long one," says Newmar, who has been unable to secure money to develop long-held commercial property. She's thought about selling, but not at distressed prices.
"It might be a wonderful time to get in," she says. "If you have the cash."
Spelling appears to have plenty, just from the recent sale. That didn't prevent her from haggling a better deal on her new luxury condo at the 42-story Century building in Los Angeles.
She had planned to pay about $47 million for her two-floor, 16,500-square-foot unit. With prices plunging, Spelling says she got it for about $34 million, a 28% reduction, plus perks including additional parking spaces, storage space and an office.
"I kept asking" for concessions, she said. "At one point, I was either going to buy the unit or walk away. But I'm very happy. We did well."