Bob: many buyers of million dollar properties are 'trading up' from $750K properties in El Lay. But $750K properties aren't necessarily luxury homes.
Take a look at this little bitty thing on half a Venice lot (you have to enter fromt he alley) probably 60 x 45 feet. A half million bucks.
http://guests.themls.com/photos_addl.cfm?mls=04-078746&p_type=0&addr=2416%20WALNUT%20AVE
Down the street in a very nasty neighborhood, is a full-sized house on a 'normal' 4300 square foot lot needing total rehab for only $780K.
Wacky.