From $250 Million to $130 Million at Auction: What the Casa Encantada Sale Means for Bel Air Sellers

The most talked-about residential sale in Los Angeles this summer did not happen through a listing agent or a typical 30-day escrow. It happened at a foreclosure auction in July 2026, when Casa Encantada, a 60-room Bel Air estate that had once been listed for $250 million, sold to an undisclosed buyer for $130 million.

That sale made Casa Encantada the largest residential transaction in Los Angeles for 2026. It also made it one of the most instructive examples in recent memory of what can happen when a high-value property enters a cycle of repeated price cuts, accumulated debt, and years without a completed sale.

If you own property in Bel Air or anywhere in the ultra-luxury market, this story is worth understanding in detail.

What Is Casa Encantada?

Casa Encantada sits on 8.4 acres at 10644 Bellagio Road in Bel Air, overlooking the Bel Air Country Club. The estate was designed by architect William Haines and completed in 1937. It is recognized as one of the finest examples of Georgian Colonial architecture in the United States, with approximately 23,000 square feet across 60 rooms.

Telecom billionaire Gary Winnick purchased the property in 2000 for $94 million, which set a U.S. residential sale record at the time. The estate came to market for sale after Winnick's death in 2023, and the price cuts that followed became a recurring story in luxury real estate news.

The Price Journey

The estate lost 48 percent of its original asking price over several years. When the final sale happened, it bypassed the MLS entirely, closing through a trustee's sale rather than a negotiated purchase agreement.

How the Property Reached Foreclosure

In 2020, the Winnick estate borrowed against Casa Encantada through CIM Real Estate Credit LLC, a commercial real estate lender. By the time of Gary Winnick's death in 2023, the outstanding debt had grown beyond $150 million, including accumulated interest and fees.

Karen Winnick, his widow, filed legal claims alleging the lender had engaged in a scheme designed to engineer a default and acquire the property. Courts did not halt the foreclosure process, and a trustee's sale proceeded in July 2026. A buyer, whose identity has not been disclosed publicly, acquired the estate for $130 million.

Despite being a distressed transaction in a slow market, the sale represented the largest single-family residential deal in Los Angeles County for 2026, happening at a moment when luxury contract volume was down significantly from the prior year.

How a California Trustee's Sale Works

In California, when a borrower defaults on a deed of trust, the lender can initiate non-judicial foreclosure. After recording a Notice of Default and serving the required waiting periods, the trustee can set a sale date and sell the property at public auction.

At a trustee's sale:

• Buyers must bring certified funds for the full purchase price. There is no mortgage financing available.
• There are no contingencies, no inspection period, and no opportunity to negotiate repairs or concessions.
• The property sells as-is, with no Transfer Disclosure Statement or Seller Property Questionnaire.
• Liens junior to the foreclosing deed of trust are extinguished, but senior liens survive and become the buyer's responsibility.

For sellers, the outcome of a trustee's sale is typically worse than a negotiated arm's-length transaction. The absence of seller disclosures, the cash-only requirement, and the compressed timeline all create conditions that attract investors expecting a significant discount.

Measure ULA at $130 Million: The Tax Arithmetic

10644 Bellagio Road sits within the City of Los Angeles city limits. That means the deed transfer triggered Measure ULA, the documentary transfer tax that has been in effect since April 2023 and has survived all recent repeal efforts.

As of 2026, the Measure ULA thresholds are:

• 4 percent of the entire sales price for transactions above $5.4 million
• 5.5 percent of the entire sales price for transactions above $10.9 million

At a $130 million sale price, the Measure ULA obligation is $7.15 million. This applies to the recorded deed transfer regardless of whether the transaction was a standard negotiated sale or a trustee's auction.

Buyers at a trustee's sale bear the documentary transfer tax when the deed records. Any bidder at a Casa Encantada-style auction must factor Measure ULA into the total acquisition cost before submitting a bid.

For comparison: a $10 million Bel Air transaction generates $400,000 in Measure ULA. A $130 million transaction generates more than 17 times that amount.

Thinking about selling a luxury property in Bel Air or anywhere on the Westside? Grey Square works with buyers and sellers across the luxury market. Get a home value estimate or contact us directly.

What Sellers Should Take Away

Casa Encantada is an extreme case. Most Bel Air sellers do not carry $150 million in commercial debt against their homes. But the dynamics that played out here appear in smaller form across the ultra-luxury market regularly.

Thin buyer pools accumulate carrying costs fast. At $100 million and above, the number of qualified buyers who can close in any given year is very small. At $30 million, the pool is larger but still limited. Every month without a sale means property taxes, insurance, maintenance, and, if the home is debt-financed, interest charges that compound. At Casa Encantada's debt level, annual interest alone likely exceeded $8 million.

Repeated price cuts tell a story buyers pay attention to. A property that moves from $250 million to $195 million to $165 million does not just signal flexibility. It signals that something about the property or the price has made every qualified buyer say no. Buyers and their agents track price history carefully. Each reduction often attracts fewer serious inquiries than the one before, as the market interprets the pattern as evidence of distress or fundamental overpricing.

A foreclosure auction almost always produces worse outcomes than a negotiated sale. The Beverly Hills Benedict Canyon estate Villa Lulu, owned by Steve Wynn, sold for $47.75 million in July 2026, also at a steep discount from its original asking price. That sale moved through a standard escrow with full disclosures, buyer due diligence, and a negotiated purchase agreement. The seller had more control, more certainty, and more net proceeds than a trustee's sale typically allows.

Realistic pricing from the start avoids compounding losses. The Casa Encantada story began with an asking price that had essentially no precedent and a buyer pool measured in single digits globally. Entering the market at a price the market can support, even if that price is lower than the seller hoped, produces better outcomes than years of carrying costs followed by a forced sale.

Frequently Asked Questions

Does Measure ULA apply to foreclosure auction sales in Los Angeles?

Yes. Measure ULA is a documentary transfer tax assessed on all real property transfers in the City of Los Angeles, including trustee's sales. The party who records the deed is responsible for paying the tax at the applicable tier.

Can a buyer finance a purchase at a California trustee's sale?

No. Buyers at a trustee's sale must bring certified funds for the full purchase price. Mortgage financing is not available at auction. This requirement effectively limits the buyer pool to institutional investors and high-net-worth individuals with access to large amounts of liquid capital.

What happened to existing liens when Casa Encantada sold at auction?

In a California trustee's sale, liens junior to the foreclosing deed of trust are extinguished by the sale. Liens senior to it survive and attach to the property in the buyer's hands. Buyers at foreclosure auctions must research the title record carefully before bidding.

How is the sale price at a trustee's sale determined?

The foreclosing lender typically sets an opening bid equal to the outstanding loan balance plus fees. Third parties can bid above that amount. If no third party bids above the lender's opening bid, the lender takes the property at the bid amount. If a third party bids higher, that bidder acquires the property.

How does a Bel Air foreclosure sale compare to a standard Westside transaction?

A standard sale in Bel Air includes the Transfer Disclosure Statement, Seller Property Questionnaire, Natural Hazard Disclosure, and a negotiated purchase agreement with inspection and financing contingencies. A trustee's sale has none of these protections. The result is a compressed, riskier transaction that requires a substantial discount to attract bidders.

Why This Matters for Bel Air Sellers in 2026

The Bel Air market spans three historic sections with very different price points. Entry-level Bel Air begins around $4 million. Larger estates with significant acreage regularly trade in the $20 million to $50 million range, where Measure ULA applies at the full 5.5 percent tier. The Casa Encantada story sits at the extreme end of this market, but the core lessons hold at any price point where the buyer pool is limited and carrying costs are material.

If you are selling in Bel Air, knowing what your net proceeds look like under realistic sale scenarios, including a timeline that accounts for the actual buyer pool at your price point, is the starting point for any sound pricing decision.

Grey Square works with sellers and buyers in Bel Air, Beverly Hills, Brentwood, and across the Westside. Contact us to talk through your property and your numbers.

Paul Blair is the founder and broker of Grey Square, a virtual real estate brokerage representing buyers and sellers across Dallas and Los Angeles. With 22 years in the business and more than $200 million in closed transactions, Paul works the full range of the market, from luxury homes in the Park Cities and Preston Hollow to estates in the Hollywood Hills and across the Westside. Connect with Paul and the Grey Square team at greysq.com. CA DRE #01792671.