Devastating Fires Destroyed Luxury Homes, Apartments, and Commercial Properties
The Palisades and Eaton fires, the two most destructive wildfires to hit Southern California in January, have caused an estimated $30 billion in real estate losses, impacting properties ranging from condominiums to multimillion-dollar estates, according to an analysis by the Los Angeles Times.
The assessment, which compared data from Cal Fire and Los Angeles County Assessor parcel records, offers a sobering perspective on the financial toll of these historic wildfires. Cal Fire reported that 16,249 structures in Los Angeles County were either destroyed or severely damaged, including approximately 11,500 homes. The fires, which burned for nearly a month before being fully contained, devastated 56% of the properties in Pacific Palisades and nearly half of those in Altadena.
The fires forced the displacement of roughly 13,000 households. The destruction included 9,600 single-family homes, over 100 condominiums, 678 apartment units, more than 2,200 duplex and bungalow-style homes, and 373 mobile homes.
Many of the lost residences were high-value properties, with 79 single-family homes priced between $10 million and $23 million caught in the path of the Palisades fire. Moreover, the loss of rental properties could significantly impact affordable housing availability. Approximately half of the destroyed single-family homes lacked a homeowners’ exemption, indicating they were rental properties.
Additionally, records from the Los Angeles Housing Department confirm that 770 rent-controlled units were lost in Pacific Palisades. According to the analysis, if the city’s rent stabilization ordinance does not cover replacements, the fires could have lasting effects on housing affordability.
A study by UCLA Anderson Forecast estimates the total economic losses from the fires could range from $95 billion to $164 billion. Insured property losses alone could reach $75 billion. The study projects a 0.48% decline in Los Angeles County’s GDP for 2025, equating to approximately $4.6 billion, and a wage loss of nearly $297 million for businesses and employees in the affected regions.
The findings suggest that without significant investments in wildfire mitigation, Californians will continue to face rising insurance premiums and growing health risks from wildfire-related pollution. The UCLA report shows the justification for increased investment in fire prevention efforts, considering the astronomical costs of wildfire destruction.
The Palisades fire alone has resulted in greater real estate losses than any wildfire in California history, with the Eaton fire ranking second. Combined, the fires scorched approximately 40,000 acres across Los Angeles County. According to an analysis by CoStar Group, more than 95% of the estimated $30 billion in real estate losses stem from single-family homes.
In total, the fires destroyed 11,000 homes valued at nearly $29.7 billion. The average value of destroyed homes in Pacific Palisades exceeded $4 million, while those lost in the Eaton fire averaged $1.4 million. The destruction also extended to apartment buildings, with 74 buildings containing 870 units—valued at an estimated $390 million—demolished in the fires. The majority of lost apartment buildings were small complexes built in the 1950s and subject to rent control regulations.
Commercial properties were also affected, with 26 office buildings (totaling 248,000 square feet) valued at approximately $114 million destroyed. Additionally, two industrial buildings (208,000 square feet) with an estimated value of $60 million were lost, along with 67 retail properties worth an estimated $226 million. Retail losses were concentrated in high-end commercial areas, including Palisades Village, where major retailers such as Gelson’s Pacific Palisades and a 20,500-square-foot Ralphs supermarket were destroyed.
The commercial weather forecasting firm AccuWeather estimated that the total cost of the fires—including property losses, cleanup, infrastructure repairs, temporary housing, and the ripple effects of lost business—could reach $272 billion. While this figure encompasses direct and indirect economic consequences, a breakdown of specific cost components has not yet been published.
With insurance claims still being processed and full damage assessments ongoing, experts warn that the financial impact of the Palisades and Eaton fires may continue to rise in the months ahead. In the wake of these devastating wildfires, policymakers and local officials face urgent decisions regarding rebuilding efforts, insurance regulations, and wildfire prevention strategies to mitigate future disasters.
