The US housing crisis arrived on July 14 at Stonebrook Court, the 26,000-square-foot Tudor-style home of California venture capitalist Kelly Porter. On that day, four months after putting the house on the market, he cut the price by $US7 million ($8.4 million).



It's still for sale.



The mansion sits on 7.5 acres in Los Altos Hills, a Silicon Valley town where Yahoo! Inc. co-founder and Chief Executive Officer Jerry Yang also lives. It boasts a wine cellar, Venetian- inspired ballroom, Italian statuary and swimming pool. At the reduced price of $US38 million, the property is a bargain, the owner says.



``It's worth every bit of $US45 million, and I reduced it reluctantly,'' said Porter, 45, a partner at Woodside Capital Partners LLC in Palo Alto, in an interview. ``We touched up every square inch.''



The pain of the worst housing slump in a quarter century is reaching the highest end of the market as owners of luxury homes from California to Florida, New York and Connecticut slash list prices by millions. In the broader market, home sales plunged to a 10-year low in the second quarter and median house prices fell 7.6%, according to the National Association of Realtors.



``The upper end is not immune to this decline,'' said Kenneth Rosen, chairman of the University of California's Fisher Center for Real Estate and Urban Economics in Berkeley. A worsening economy means ``these people will have less wealth and they will spend less.''



Lower list prices



A 10,340-square-foot home in San Francisco's Pacific Heights neighborhood is for sale at $US14.8 million, 17% below last year's asking price. A 153-acre property with a vineyard near the Napa Valley sold in February for $US14.7 million, 8% off the price last year. A home in Marin County's Tiburon, a town where tennis star Andre Agassi used to live, was acquired in August for $US900,000 less than the $US7 million list price in 2007.



To be sure, the price cuts may often mean only smaller profits on property acquired years ago. Cinthia Haan, 53, bought the Pacific Heights home for about $US3 million in 1992 and spent $US3 million on renovations, she said. She stands to make an $US8.8 million profit at the current asking price.



While Porter declined to say how much he spent on Stonebrook Court, real estate records show he paid $US5 million in 1999. He did say refurbishing the place cost ``tens of millions'' of dollars.



Tightening standards



The same tightening of lending standards that has made it harder for ordinary Americans to finance and purchase property has also affected those who don't need a mortgage, said David Lichtman, 45, chief credit officer of First Republic Bank, a San Francisco-based private bank and unit of Merrill Lynch & Co.



``You have smart buyers seeing a softer market, looking to negotiate a good price,'' Lichtman said. ``Nobody wants to overpay.''



Luxury home prices in the second quarter fell 3.8% in Los Angeles and 7.8% in San Diego from a year earlier, while gaining 0.2% in San Francisco, according to a First Republic property index. The measure tracks a group of houses costing more than $US1 million in the three areas.



High-end sellers must lower asking prices by 20% compared with a year ago, when initial listing prices didn't reflect stricter credit conditions, said James Chalke, a broker at Nelson Shelton & Associates in Beverly Hills.



``What's really happening is that sellers are taking value off their own markup,'' Chalke said. ``A property is only worth what a buyer is prepared to pay for it.''



Trump's price cut



An 11-bedroom property in the Bel Air section of Los Angeles, the neighborhood where actor Leonardo di Caprio and actress-singer Jennifer Lopez live, didn't attract potential buyers until the asking price dropped by $US10 million, to $US35 million, Chalke said.



Donald Trump's Palm Beach, Florida, estate, originally listed at $US125 million, sold for $US95 million in July, the Palm Beach Post reported July 16. Trump, 62, paid $US41.35 million in 2004 and renovated the property, according to the newspaper.



Charles Prince, 58, former chief executive officer of Citigroup Inc., sold his five-bedroom home in Greenwich, Connecticut, for $US5.2 million, 15% less than the original asking price of $US6.15 million. The median price in the town fell 2% in June to $US1.95 million, according to Prudential Connecticut Realty.



Sales of luxury Manhattan apartments are down 25% in the third quarter compared with a year ago, and ``no one's sure where prices will go'' as Wall Street firms cut jobs, according to Hall Willkie, 59, president of the Brown Harris Stevens brokerage.



Free Bentley



The economic slowdown led Olivia Hsu Decker, of Decker Bullock Sotheby's International Realty in Tiburon, to organize a five-day tour of 20 unsold properties in the San Francisco Bay Area that began Sept. 1. More than 100 potential buyers from the US, the U.K., France, Switzerland, Taiwan and Macau are attending parties and opera and symphony performances as part of the event, she said.



Decker said she will throw in a $US174,100 Bentley sedan for the buyers of Porter's Los Altos Hills property and of a 10,000- square-foot home on the tip of Belvedere Island with views of the Golden Gate Bridge, listed for $US65 million. Owner Robert Friedland, chairman of Vancouver-based Ivanhoe Mines Ltd., bought the place, known as Locksley Hall, in 1995 for $US5.5 million and spent $US34.5 million on renovations, Decker said.



Haan, founder of the Haan Foundation for Children, spent three years redoing the six-bedroom house in Pacific Heights.



``I'm ready to let go now,'' Haan said. ``I'm ready to sell.''



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