The Agency’s President, Rainy Hake Austin, recently spoke with The Real Deal’s Kari Hamanaka on emerging lifestyle trends, hot local submarkets, current regulations and the impact they’re all having on the L.A. market.
See below for an excerpt of The Real Deal article, The Agency’s Rainy Hake Austin Talks Trends in LA Luxury Market.
Rainy Hake Austin is approaching the four-year mark The Agency.
As president of one of Los Angeles’ largest brokerages, the executive stepped into her role at the height of the pandemic after heading up West Coast operations for Compass. She’s now helping lead The Agency’s business during a period of turmoil for L.A. agents and the entire industry.
Locally, the market has taken a hit from the flight of home insurers from the state and implementation of the Measure ULA transfer tax. Yet, homes under $5 million are enjoying bidding wars. Some high-rises are seeing interest due to shifting lifestyles, including April’s $24 million sale of the Penthouse at 8899 Beverly, which involved The Agency on both sides of the deal. Meanwhile, Malibu can’t stop nabbing record-breaking closings, including the $61 million trade of a spec mansion named The Edge, where The Agency had the listing.
Austin shared her thoughts with TRD on what she sees in the market, the lifestyle trends driving closings and what the NAR settlement rules could mean for the future.
What do you and your agents see playing out for L.A. residential?
Generally, it has been up from last year, but there are so many market dynamics in flux right now. The luxury market has slowed a little bit, but you’re still seeing large transactions. It’s not dead, but it’s kind of sporadic.
The driver of the overall market uncertainty is interest rates and other things impeding the general supply and demand. But, when you look at the overall, there are lifestyle trends and not just market dynamics happening.
What sorts of lifestyle trends?
One of the things that we’ve seen a lot of is the trend of tech toward next-level smart homes — being equipped with advanced technology features beyond automated systems.
There’s also an increase in preference for eco-friendly homes. Those with solar panels are coming in at a higher valuation. There’s new construction that is more efficient versus some of the older homes that have inefficiencies but maybe more character.
Another trend is around wellness and general lifestyle amenities. In my opinion, the quintessential Los Angeles lifestyle has never really been about walkability or being close to things. It’s been much more about this luxurious, glamorous piece but also this desire for wellness amenities that has transitioned into homes.
We’re seeing the cold plunge, sauna and massage rooms inside of homes, where people are dedicating physical space. Even with sports, it used to be basketball [courts] and now we’re seeing pickleball and stickball, converting existing courts for those.
This kind of parlays into the fourth trend, walkability.
In the years that I’ve seen the L.A. market grow, it’s really been a sprawling L.A. market. It has always been horizontal. I’m finding that’s shifting. We’re seeing walkability increasingly drive demand.
That’s walkability for shops and restaurants and nightlife. So, we’ve seen branded residences of luxury condos. We see celebrities, from sports to TV and entertainment, who are giving up their mansions and moving into this super luxury condo living, where they have security, walkability and it’s more service oriented.
On walkability, is the demand coming from more inventory available, or from people moving to L.A. from parts of the country or world that are more accustomed to high-rise living?
The market certainly has not always had that type of inventory, and so the availability of that inventory has sparked interest. There has always been migration between the two coasts: San Francisco to New York or New York to L.A., and they are more familiar with vertical living.
In L.A. we’re seeing people give up mansions for vertical living. They can avoid traffic or celebrities can avoid visibility.
What submarkets are seeing the most activity?
There has really been an increased demand for coastal living. The Malibu market ebbs and flows and it’s hot or cold. Right now, it’s pretty hot. You’re seeing a lot of large sales going on. [The spec home at] The Case, the sale there marked one of the highest-priced sales in Malibu this year.