As the summer leasing scene in Malibu wraps up, real estate experts report that for homeowners the rental season smelled worse than a red tide at morning.
Of course, a bad deal for a homeowner means a good deal for someone looking for temporary refuge by the beach. Renting a place in Malibu could cost as little as $150 a night, according to industry statistics — priced more like a Branson, Mo., by the sea than the playground of the stars.
For that price a renter could luxuriate in a creek-side studio cottage "minutes from Malibu beach," according to HomeAway.com. The online rental service's top price is $5,000 a night for a seven-bedroom, six-bath manse on Broad Beach.
Unlike many other workaday markets where transactions are increasing, the once-hot Malibu rental picture has cooled considerably since five years ago, the Multiple Listing Service shows. Half as many lease deals have been reported this year as during the same period in 2008, and rental closings were down 25% from last year.
At play, area real estate agents say, are financial belt-tightening and a more active for-sale market spurred by a sense that the market has seen bottom. The result was less competition for rental houses and more deal-making for shorter-term rentals.
"Five years ago, everyone wanted three months," said Gardner, who keeps tabs on the local housing market at TheMalibuRealEstateBlog.com. This year, renters haggled for one-month stays.
That doesn't go over well in gated Malibu Colony, the sandy refuge of big bank accounts. Some beach-house seekers even went so far as to ask for two- or three-day rentals, Hilton & Hyland agent Chad Rogers said.
"Owners of $10-million-to-$20-million homes want to do one or two leases at the most and then not think about it," Rogers said. "The majority in the Colony don't want to rent for less than a month."
Rogers said he completed lease deals this year at $80,000, nearly $90,000 and $125,000 a month, but not every home among his listings found a tenant.
Homeowner Phil Roman, whose main residence is in Los Angeles, has leased out his beach house on occasion during his 20 years in the exclusive enclave.
"If you are living in town, why not lease your home and make some money?" said Roman, who spent about $3 million upgrading the nearly 3,000-square-foot house along the sand before pricing it at $125,000 a month this summer. The traditional-style two-story on a double lot received two one-month offers but not the three-month term the businessman wanted.
Now he is hoping for an even longer term.
"If I could get $70,000 a month for a year," Roman said, "I'd take it."
The decline in completed leases may have left some Malibu houses sitting unclaimed, but the challenge in agent Stephen Shapiro's niche was finding enough suitable properties for his ultra-rich clients.
"There were far fewer high-end houses available in the $100,000-plus range," said Shapiro, co-founder of Westside Estate Agency.
In one of the most expensive leases this year, a Shapiro client paid $300,000 — $150,000 a month for two months — for a double-lot oceanfront compound in Malibu Colony with a sun deck by the sand, a six-bedroom main house and a two-room guest cottage.
That's pricey, but not as luxe as the Multiple Listing Service's record Malibu deal: $200,000 a month, set in 2009, which translates into nearly $214,000 when adjusted for inflation.