Lizzo loses nearly $4M on her LA mansion — a third of its value. How to know when selling at a loss is the right move

Lizzo recently sold her Beverly Hills mansion, taking on a big loss in order to let the property go.

The Grammy Award-winning artist put the home on the market more than a year ago, according to a New York Times report (1). She reportedly bought it in 2022 from a Warner Records executive for $15 million.

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When she listed her home in late 2024, the singer was asking for $15.99 million, but the Times reports the most recent asking price was dropped to $12.5 million. However, the home eventually sold for $11.15 million — a loss of almost $4 million.

The mansion isn't short on amenities, as the 5,442-square-foot home has a private studio, theater room, salt-water pool, gym and an outdoor kitchen with a fire pit. It's also in a gated community, sits on almost a third of an acre and has "sweeping canyon and hillside views," according to the Times.

The property has even been home to another pop star — singer Harry Styles — although the current home was built in 2018. Styles's former home was demolished after he moved out in 2016, according to a Realtor.com report (2).

Selling a home at a loss is never easy, but sometimes it's a move you might have to make.

Circumstances that might push you to sell a property at a loss could include financial pressure that's making it hard to make mortgage payments, having to relocate quickly or dealing with a declining real estate market (3).

If you are unable to keep up with your mortgage payments, or if you find yourself in a situation where you're underwater on your mortgage, it could make sense to sell at a loss, according to HomeLight (4). It may also make sense for those who are forced to move for work to sell at a loss.

You might also find yourself in a situation where the financial pressure of carrying a mortgage becomes too much to handle — the death of a partner or going through a divorce, for example.

If you’re underwater on your mortgage — which means you owe more than the home is worth — you might be able to negotiate a short sale with your lender. A short sale is when your home sells for less than the mortgage balance, but the lender agrees to forgive the difference.

According to Yahoo Finance, this option typically requires that you're behind on mortgage payments (5). A short sale can also impact your credit, so it's not an ideal option if you're looking to buy another home right away.

According to HomeLight, situations where you might choose to hold onto your home instead of selling at a loss include circumstances where your home value drops.

If you bought at the top of the market and suddenly your home is worth a lot less, it could make sense to stay put if you're still able to afford your mortgage and you have long-term plans to stay in the home. In a case like this, HomeLight says, waiting for the market to bounce back might make sense.

You could also consider renting out your home instead of selling, though you should take into account all the responsibilities and potential risks that come with being a landlord before making this decision. You'll also have to research the rental market in your area to make sure you'll be able to make enough to cover your mortgage and expenses.

If you're thinking of converting your home to a rental unit in order to then sell it and claim a capital loss, Realtor.com warns that there are timing requirements and other complexities to this strategy (6), and you should definitely consult with a tax professional before making this move.

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We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.

The New York Times (1); Realtor.com (2),(6); HomeLight (3),(4); Yahoo Finance (5).

This article originally appeared on Moneywise.com under the title: Lizzo loses nearly $4M on her LA mansion — a third of its value. How to know when selling at a loss is the right move

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