The rich may indeed be like the rest of us. Prices of their homes are now falling too.
Gated mansions and hillside estates have held their own through most of the real estate slump, but data released Monday showed big drops in the region's most exclusive neighborhoods.
Median sale prices fell by 13% in Beverly Hills in April, compared with the same month last year. Rancho Palos Verdes dropped 18% over the same period, while Newport Beach's 92660 ZIP Code took a 34% hit, according to DataQuick Information Systems.
Experts say these areas and others are catching up with price declines that struck first in outlying suburbs such as the Antelope Valley and the Inland Empire, where many first-time home buyers purchased their properties with sub-prime loans.
"You can't have one market hugely cheaper than another forever," said UC Berkeley professor Thomas Davidoff, who specializes in real estate.
Davidoff and others say the time lag stems from the fact that affluent homeowners generally don't have to sell under duress, unlike struggling borrowers facing escalating mortgage payments. But wealthy homeowners are increasingly finding out that if they want to sell their homes, they will need to discount the prices.
O. Bruton Smith, an auto dealership and racetrack magnate, more than a year ago put his stately Italianate house in the Beverly Hills 90210 ZIP Code on sale for $12 million. Buyers were scarce, and so in February he cut $500,000 from the asking price.
In March, Smith breached what realty agents say is the Maginot line of mansions in the area: He slashed the price to below $10 million, to $9.995 million. That may have done the trick.
"It's a psychological break point," Michael Libow, the agent listing the house, said of the $10-million mark.
The reduced asking price has been drawing three or four potential buyers a week to see the house, Libow said, and an offer came in last weekend.
The decline in the high-end market can be seen in both the Los Angeles and the San Francisco Bay Area markets, according to a study released Monday by First Republic Bank of San Francisco.
The weak economy suggests that prices will remain depressed for some time, said First Republic's president, Katherine August-deWilde.
"People worry about their jobs and incomes -- even rich people," she said.
Orange County's more expensive neighborhoods are also seeing price declines, DataQuick figures show.
