Fire Sale
In the aftermath of the Eaton and Palisades fires, housing could have been stabilized and tenants could have been protected. But the private market won.
When the Eaton and Palisades fires tore through Los Angeles in January 2025, they did so on a scale the city had never before endured. Fire, of course, is not anomalous in Los Angeles. It is a recurring and constitutive feature of the region’s ecology. What distinguished these fires was their magnitude. The Eaton and Palisades fires displaced more people than any California fire in over a century, including the 2018 Camp Fire—the deadliest in the state’s history—and other conflagrations over the past decade. Over the course of twenty-four days, roughly 150,000 residents were forced from their homes. More than 16,000 buildings—among them over 13,000 homes—were destroyed. Two neighborhoods were effectively erased. Thousands of firefighters were brought in from outside the region as the disaster exceeded the city’s capacity to contain it. In scale, cost, and consequence, the Great Los Angeles Fires marked a turning point.
Over a year later, various accounts have sought to take stock of the disaster. Journalist Jacob Soboroff’s recent book Firestorm: The Great Los Angeles Fires and America’s New Age of Disaster, for instance, offers an exhaustive account of the fires’ opening days. Its cadence resembles that of a field diary. Soboroff records events as they happen in granular detail, conveying the scale of the crisis while illuminating dimensions of the disaster that remained invisible to those who watched it from a distance. Yet the immediacy of Soboroff’s chronicle leaves little room for the structural forces that shaped both the impact of the fires and their aftermath: a parallel story of land speculation, predatory landlordism, insurance industry opportunism, and uneven recovery, the effects of which have persisted into 2026 across Los Angeles.
The day after the fires’ ignition, landlords, rental platforms, and insurers were already setting the terms under which tens of thousands of displaced residents could remain in the city. Rather than taking meaningful steps toward recovery by enabling rehousing and stabilization, the post-disaster landscape was reorganized through market mechanisms that privileged profit. The Great Los Angeles Fires, to put it another way, are a story of disaster capitalism.
By the second week of the fires, as public attention focused on dry fire hydrants and a mayor who was out of town, reports of rent gouging began to surface. In Santa Monica, five miles from the Palisades fire, a two-bedroom apartment on Montana Avenue listed for $3,595 on January 7 was relisted within twenty-four hours at $4,495. By January 9, the price reached $5,995. Similar increases appeared in neighborhoods far from the fires. In Westlake, one of the city’s more affordable areas, a unit previously listed for $2,400 was relisted at $3,300 within days. These patterns were not just anecdotal: they were documented in a crowdsourced spreadsheet of more than 1,500 Zillow listings showing illegal rent hikes. Such increases violated price-gouging protections triggered by the state of emergency declared on January 7—a legal context that landlords appeared willing to ignore.
Over the following weeks and months, as rents continued to climb, displaced residents were unable to find housing at any price they could afford. Searches far outside their original neighborhoods yielded few viable options. In many cases landlords demanded rents that exceeded the mortgage payments people had been making on the homes that had just burned down. Many fire victims were forced to stay in hotels or short-term rentals, or else to leave the city altogether.
This outcome was not inevitable. Elected leaders could have mobilized short-term rentals into the long-term market, meaningfully enforced price controls, leased vacant units to displaced residents, or secured hotel rooms at scale through master leasing for a long-term period. Instead, policy responses moved in the opposite direction, accommodating rather than constraining these dynamics. Airbnb positioned itself as a benevolent intermediary. The company offered rental vouchers—which, residents told the Los Angeles Times, proved “useless”—while simultaneously pressing for deregulation, arguing that hosts were reluctant to rent to wildfire victims out of fear that stays longer than thirty days might trigger tenant protections. In response, Governor Gavin Newsom loosened regulations via an executive order on January 27, specifying that displaced residents staying over thirty days in short-term rentals would not be considered tenants.
Evictions further intensified displacement. The economic fallout extended to those who sustained the daily life of the Pacific Palisades and Altadena, including nannies, landscapers, handymen, pool cleaners, groundskeepers, and employees of destroyed businesses, who lost their incomes as the fires disrupted homeowners’ routines. Others faced eviction from landlords citing personal need, property damage, or displaced relatives. With an estimated 200,000 people suddenly forced into an already constrained housing market, the incentive to extract higher rents was obvious. Reporting from the Washington Post found that rents across the region rose by approximately 20 percent in three weeks.
Policy responses were entirely inadequate to the scale of the crisis. Tenant unions and housing advocates called for eviction protections, but the political will to enact robust measures never materialized. Their demands were dismissed by landlords and conservative elected officials as “opportunistic,” even as mounting evidence showed that exploitation was being driven by short-term rental platforms, rent-gouging landlords, private equity interests, and insurance companies. The burden of recovery was shifted onto displaced residents themselves, who were forced to navigate a starkly inhospitable housing market. Even those lucky enough to own a home and have adequate insurance coverage—after a wave of policy non-renewals by companies like State Farm in Pacific Palisades in the months before the fire—faced months of haggling over claims.
Political attention narrowed around the forms of exploitation that were most legible and easily condemned. Rent gouging became the preferred target of outrage after Angelenos themselves forced the issue into public view. Yet the media coverage that followed—from the Los Angeles Times to national and international outlets—framed the crisis as one of bad actors rather than a systemic market failure. Public officials echoed this framing in their rhetoric. In a press conference on January 15, Los Angeles County District Attorney Nathan Hochman urged rent gougers to cease their behavior and refund tenants; two days later, California Attorney General Rob Bonta described landlord conduct as “unimaginable,” emphasizing the need for care and support rather than exploitation.
When this rhetoric was put to the test, its limits immediately became apparent: not only was structural reform never on the table, but even the enforcement of existing law proved anemic. By the sixth week after the fires, only four enforcement actions had been brought—one civil lawsuit and three criminal charges. After four months, just nine landlords had been charged. The attorney general’s office announced that it had sent some 750 warning letters to suspected rent gougers, while Hochman had not pursued any rent-gouging cases despite his earlier public statements. In the end, the government response relied overwhelmingly on warnings, notices, and reminders of the law, measures that amounted to little more than a tap on the wrist.
This approach reflects a broader institutional orientation toward landlord misconduct, treating it as a matter of regulatory noncompliance rather than criminal wrongdoing. In treating it this way, the state signals that such behavior carries little real risk. While the law makes rent gouging punishable by fines or jail time, landlords have faced neither.
A recent report by the Rent Brigade (an organization that one of us, Chelsea, helped found after the fires) found that, one year after the fires, rent gouging persisted even as enforcement waned. As of January 2026, the district attorney still had not brought a single rent-gouging case; the Department of Consumer and Business Affairs had not issued a single fine; no tenant had successfully sued a landlord despite a new policy authorizing them to do so; and not a single state bill to curb rent gouging had become law. One such bill passed both houses of the legislature before being vetoed by Newsom. The report counted more than 18,000 listings that appeared to reflect illegal rent increases. Meanwhile, within the first week of the fires, sixty people were arrested on suspicion of looting private property or violating curfew. The early moral condemnation, in the end, produced only the appearance of accountability.
Fights over the reconstruction of Altadena also revealed the role of speculative market logics in the disaster. Almost immediately after the fires were contained, property owners reported receiving offers from corporate buyers seeking to purchase burned parcels at steep discounts. Seeking to interrupt this process, residents organized under the banner Altadena Not for Sale, forming a community land trust and coordinating strategies for collective ownership. These efforts were an explicit attempt to prevent a repetition of the 2008 recession and its aftermath, when private equity firm Blackstone consolidated large numbers of foreclosed homes across Los Angeles, permanently restructuring the local housing market.After the fires, rapid reconstruction was promised, but little materialized in practice, and speculative acquisition advanced in the interim. By June, half of all sold lots in Altadena went to corporate buyers. Even ostensibly benevolent interventions reinforced this dynamic. Edwin Castro, an Altadena native and winner of the $2.04 billion Powerball jackpot in 2022, spent roughly $10 million acquiring fifteen properties in the neighborhood, announcing plans to rebuild homes at full market value for families deemed committed to the community. The centrality of insurance in our country’s housing finance system, moreover, makes it a major player in determining the who, when, where, and how of recovery and rebuilding.
Accounts of the fires that do not attend to these forces treat the disaster as a closed event rather than an ongoing process. Yet it is clearer than ever that while the fires themselves precipitated the crisis, and while human-driven climate change formed its underlying condition, the private market system functioned as an active obstacle to recovery, denying access to dignified housing for residents while doing little to reduce the risk of future wildfire damage. For all the destructive power of the fires, it will be developers, landlords, insurance companies, and short-term rental platforms that most directly determine what kind of city emerges from this crisis, and whether residents are able to return to their homes, or even to remain in the city they call home.
Many haven’t. The Guardian reported in February 2026 that recovery remained largely stalled. While thousands of permits had technically been approved, only a small fraction of displaced residents have been able to begin rebuilding. Seven in ten residents forced out of Altadena and Pacific Palisades have not yet returned, with many still living in temporary housing in other cities, states, or even countries.
It is no longer speculation to say that major cities will confront crises like the Great Los Angeles Fires with increasing frequency. Climate change is accelerating, and extreme weather events such as wildfires, floods, hurricanes, and atmospheric storms are becoming a condition of urban life. The question is how cities will function when crises become ordinary rather than exceptional. If cities are to survive, and if the people who live there are to have any chance of stability, bold public action is critical.
Historically, moments of crisis have opened the door to transformative public policy. It was in the 1930s, when the Great Depression made it impossible to deny that the private market could not meet basic housing needs, that the United States first developed public housing. In the 1960s, after widespread insurer refusal to cover floods, the federal government set up the National Flood Insurance Program in recognition of the necessity of residential disaster insurance.
The Los Angeles wildfires present a similar moment of clarity. In their aftermath, elected officials had the political space to acknowledge the failure of private solutions to the crisis. Housing could have been stabilized, tenants could have been protected, and vacant units could have been mobilized to house displaced wildfire survivors. But the private market won, magnifying the crisis by turning it into an opportunity.
It doesn’t have to be this way. Proposals for permanently affordable, green, climate-resilient social housing, along with a model of public disaster insurance for homes—one that both reduces risk and provides adequate, affordable coverage for all—point toward a different path. Major disasters like the Great Los Angeles Fires demonstrate how deeply our lives are intertwined with each other and with the natural world, especially as climate change accelerates the frequency and severity of disasters. In the face of these shared risks, it is our collective—not individual—responsibility to build public institutions capable of preventing avoidable harm and guaranteeing the material conditions necessary for a dignified life.
Chelsea Kirk is a policy director at Strategic Actions for a Just Economy. She co-founded the Rent Brigade after the Los Angeles wildfires to document and combat illegal rent gouging.
Moira Birss is a senior fellow with the Climate and Community Institute and an independent consultant on climate and economic justice policy.