In further proof that LA’s luxury real estate market is evolving, the days of the looming mansion seem to be on the wane. A new trend shows that the city’s wealthiest buyers are turning their attention to the compound house model. Rather than a single decadent home, the compound house stitches together a series of independent structures on a single estate. You’ll often find these compounds represented by a main home, free-standing studio, guest homes, and even quarters reserved for live-in staff. So what’s motivating this shift?
Square Footage is Giving Way to Flexibility
The major motivator for the rise of the compound house isn’t personal. It’s business. Wealthy families are beginning to view the compound house as a means of establishing the most convenient access to a private family office while still keeping a division between a place of business and a home. It marks a change in priority, with future wealth-accumulation and family legacy taking precedence over the classic pursuit of square footage. The trend is particularly notable in wealthy Generation X buyers and older generations who are at a point in their lives to consider future security.
But the rise of the private family office isn’t the only factor influencing the growing popularity of the compound house model. By assembling neighboring parcels gradually over time, these families can set their own pace for land acquisition. And with LA’s land already a scarce and thus valued commodity, the strategy allows them to accrue more land over time while also enjoying the bonus of each generation of the family having its own private space.
It’s Easier in California
While the compound house phenomenon may not be unique to California, the state has made recent legal changes that favor the shift. Due to the shortage of housing inventory across California, the state has in recent years loosened its restrictions on Accessory Dwelling Units (ADUs), independent living spaces that share a lot with a main residence. Cities across California are now legally required to offer pre-approved ADU design plans while doing away with the former requirement of owner-occupancy. While this legal change doesn’t exclusively benefit the ultra-wealthy, the clear advantage is no doubt a factor in the rising popularity of compound-style living.
This is Not Exclusive to the Ultra-Wealthy
We reported recently that multi-generational housing situations were rising, even outside of the ultra-wealthy. With home prices across Southern California on the rise, the aging of the Baby Boomer generation, and a general movement toward family togetherness, multi-generational living is becoming more common. According to research gathered in 2021 by the Pew Research Center, around 18% of Americans were living in multi-generational housing. And if the compound house trend is any indicator, that number has likely risen in subsequent years. With younger adults taking advantage of loosened restrictions on ADU housing, California seems poised to lead the country in this rising trend.
How This is Playing out in LA
The benefits of a compound house to LA’s ultra-wealthy families are clear. It’s a more private model than a unified mansion, one that offers plenty of room for extended family while adding security in a city with increasingly scarce land inventory. But it’s a model that works across price points as well. It all boils down to flexibility. And that can be an attractive luxury in itself, whether shopping for a $20 million compound house or a modest single-family home with a backyard ADU.
With a brand that says as much as JohnHart’s, Senior Copywriter Seth Styles never finds himself at a loss for words. Responsible for maintaining the voice of the company, he spends each day drafting marketing materials, blogs, bios, and agent resources that speak from the company’s collective mind and Hart… errr, heart.
Having spent over a decade in creative roles across a variety of industries, Seth brings with him vast experience in SEO practices, digital marketing, and all manner of professional writing with particular strength in blogging, content creation, and brand building. Gratitude, passion, and sincerity remain core tenets of his unwavering work ethic. The landscape of the industry changes daily, paralleling JohnHart’s efforts to {re}define real estate, but Seth works to maintain the company’s consistent message while offering both agents and clients a new echelon of service.
When not preserving the JohnHart essence in stirring copy, Seth puts his efforts into writing and illustrating an ongoing series entitled The Death of Romance. In addition, he adores spending quality time with his girlfriend and Romeo (his long-haired chihuahua mix), watching ‘70s and ‘80s horror movies, and reading (with a particular penchant for Victorian horror novels and authors Yukio Mishima and Bret Easton Ellis). He also occasionally records music as the vocalist and songwriter for his glam rock band, Peppermint Pumpkin.
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