To appreciate the new math of this Southern California real estate market, consider the $10 million home.

Tom and Michelle Rhodes did. Not that that's what they'd wanted. What they'd wanted was to trade up from the five-bedroom tract house they had bought eight years ago in one of Newport Beach's most family-oriented sectors.

When the home for which they'd paid $800,000 sold this year for $2.36 million, the Rhodeses, who have three school-aged children, figured they'd soon be moving into the Taj Mahal bracket. The could spend $5 million, they proudly told their real estate agent, who promptly showed them a parade of lot-line-to-lot-line McMansions, most with no yard, some in neighborhoods that weren't even gated.

"I don't know what I was expecting," Tom Rhodes said, still mildly flummoxed. "Better views for sure. And bigger closets." It soon became clear that the dream house they'd pictured -- half-acre lot, great ocean views, wine cellar, home theater, elbowroom commensurate with the price tag -- was going to run them eight figures. And in fact, now that they have it, they say it was a bargain at $10.9 million.

"It's amazing," Tom Rhodes now marvels, "what that kind of money won't buy anymore."

Once upon a time, $10 million was the top of the housing market, even in Southern California, in one of the nation's most rarefied markets for real estate. Ten million bucks was, in the 1970s, about 10 times the then-record price of the Playboy Mansion. It was, in the 1980s, what Aaron Spelling paid for the six-acre former Bing Crosby estate.

Even in the mid-1990s, even among rich folks, $10 million was freakishly big money; only a handful of homes each year sold in that range. Not Madonna, not Cher, not Arnold Schwarzenegger lived in $10 million houses, at least in those days.

Now, however, even with the market momentarily cooling, real estate agents say $10 million is your basic starter mansion. "In the high bracket," said Beverly Hills real estate broker Cecelia Waeschle, "$10 million is now almost the norm."

Waeschle should know. For almost 20 years cross-referencing public records and private sources on the industry grapevine, she has carefully tracked home sales in a swath of Los Angeles County that encompasses the West Coast's highest concentration of $10 million-plus homes.

Among real estate professionals in Los Angeles, Waeschle's personal list has become a crucial point of reference, in part because discretion -- long a watchword in high-end real estate transactions -- has become a near-fetish in the current market. According to agents, appraisers and county officials, confidentiality agreements have spiked in popularity in the last three years, as has the use of mechanisms that keep home sales prices and the tax information from which they might be deduced out of the public record.

On or off the books, however, 2004 is shaping up to be a record year for $10 million-plus home sales. With the year scarcely half over, Waeschle says she has already counted 30 just on the Westside, the area's highest number ever. A similar list, maintained in southern Orange County by Bill Cote, a veteran Newport Beach agent, shows five such home sales, just two shy of the county's record, set last year.

Meanwhile, DataQuick Information Systems, which relies exclusively on public records, has found 27 openly documented home sales of more than $10 million statewide this year. Because so many high-end sales prices are now shielded from the public, DataQuick's numbers are substantially lower than counts kept by agents. Even so, the firm, which compiles housing data, reports that this year has already matched the last statewide peak, set four years ago.

DataQuick analyst John Karevoll said the high end of the housing market tends not to be driven by the same variables that affect most home buyers, such as mortgage rates. Sales over $10 million tend to be all-cash or complex asset swaps and rarely hinge on the availability of a conventional mortgage.

"Obviously," he said, "people who can buy a $10 million house have different issues in their lives, such as, 'Hmmm, where do I park this money I inherited or sold my company for or something -- stock market? Naaah. Bonds? Buy a jet? How about property?' " Thus, Karevoll said, the demand for high-end homes has risen in part because the doldrums on Wall Street have made real estate a comparatively more attractive investment. Indirectly, however, at least some of the $10 million-plus market has been fueled by current low interest rates.

Cheap mortgages, he said, have heightened demand for houses that cost $1 million to $2 million, and as those owners have traded up, demand has shot up at the top of the market. In that sense, Karevoll said, "everybody's floating on the same rising tide."

"It's like a trickle-up effect," said Beverly Hills broker Jeff Hyland, a native of Little Holmby and co-author of a book on Beverly Hills estates. "The $10 million buyer is probably moving up from a house he just sold for five to someone who sold theirs for three who just sold to a starter buyer. And those magnificent mansions that used to sell for $10 million are now 20 and 30 apiece."

By most measures, that's a lot of dough for a roof and four walls, but appraisers and agents say the biggest part of an eight-figure home price -- or any home price, for that matter -- is the land value.

"What bumps it up is acreage," said longtime Bel-Air broker Bruce Nelson, who this year helped a client get $12.3 million for two vacant lots on Sunset Boulevard near the Beverly Hills Hotel. (It's the big, fenced site that once held the estate of the late Sheik Mohammed al-Fassi, the Saudi royal who, in the 1980s, rocked the neighborhood by painting his nude statues flesh-tone and his mansion lime green.) "When the price of the dirt goes up, the value of the property goes up," Nelson said.

Appraisers say prices in top locations also are being driven by the teardown craze that has been inflating real estate values, on and off, since the 1978 passage of the property-tax-slashing Proposition 13. Vickie L. Gill, a Los Angeles appraiser who specializes in the $10 million-plus market, said many eight-figure homes are mini-mansions that were built in the 1980s on the remains of, say, Beverly Hills ranch houses, were resold in the 1990s, and are now selling again -- to buyers who'll raze them for still bigger houses.

Even so, agents say, the supply of grandeur is failing to keep pace with demand among the very wealthy.

"If it was $5 million three years ago, it's $10 million today," said Cote, who for 34 years has sold real estate in coastal Orange County.

So what will $10 million buy, house-wise?

"Not what it used to, that's for sure," said Malibu agent Alan Mark. "It'll still get you parts of the Westside and the [San Fernando] Valley, but you won't be the biggest kid in town. You won't even be the biggest kid in the neighborhood, really. It'll buy you a nice house, but it'll only put you on the edge of the beginning of the big, big boys."

As a demonstration, Mark offered a tour of an estate he is marketing with his son and partner, Tony, in Paradise Cove. It is three acres, bluff top and beach snug, with a bougainvillea-strewn hacienda, a tennis court and two guesthouses. The views are extraordinary. The house has a soulful, Old California feel to it. Barbra Streisand's compound is visible, just a couple of bluffs up the coast.

But upon close inspection, the tennis court is crumbling. The kitchens -- there are three -- are dated with nary a Sub-Zero among them. The bathrooms have cheap showers and cracked tile. The golf-cart path down to the beach is not landscaped. Stains of indeterminate origin dot the various carpets, and when Alan Mark opened the thick wooden gate to one of the guesthouses, it fell off.

This is, in fact, a top-of-the-market fixer-upper. And $10 million won't buy it. The owner wants $15 million but will settle for $12 million for just the main residence and one guesthouse.

"It's land value," Mark said. "But feel it." He paused. The sun glinted on the blue, blue ocean. Gulls squawked. The breeze was warm and smelled of eucalyptus and salt.

Ten million dollars did buy the Rhodeses a taupe, tile-roofed manor, high on a guard-gated hilltop overlooking Newport Beach.

Built just two years ago for the owner of a commercial plumbing business who lived in it for only 18 months before he sold it, the house came furnished down to the last lampshade by Fari International, a high-end building and design firm with a cult-like following in Orange County.

Big, plush sofas and chairs fill the family room; the walls are covered with rich wood paneling and marble insets. When 13-year-old Taylor politely greeted a guest at the tall, beveled-glass doorway, she seemed tiny next to the massive floral arrangement anchoring the entry hall.

Michelle Rhodes said the place had taken some getting used to after what she described as their old "Martha-Stewart-meets-the-Brady-Bunch" neighborhood. There, children on bikes raced among the cul-de-sacs and neighbors waved hello to each other as they clipped the hedges. Visitors drove in and out, uninhibited by pass codes and gates. The children's toys spilled out of bedrooms that were impossibly tiny.

In the new house, she said, their children could play hide and seek in their own wing and ride up and down in the built-in elevator. The home theater raised sleepovers at chez Rhodes to a whole new plateau. And even if it still was too close to the estate next door, it nonetheless had the feel of a mansion.

Their house, for all its grandeur, is not even close to being the neighborhood's most expensive, and even as they closed escrow, a neighbor was asking $15 million for a property up the hillside.

"There's always a bigger fish," Michelle Rhodes said. "The guy building next to us bought not one, but two lots."

Michelle Rhodes, below, descending the stairs of her $10.9 million house. Above, she stands with daughters Ashley and Taylor, and son Matthew outside the Newport Beach home. The family expected to pay less than half that for the house. As they closed the deal, a neighbor was asking $15 million for his property.About $15 million will buy this beachfront property that includes the main house, two guesthouses and a tennis court in Malibu's Paradise Cove. The surrounding views are spectacular but the property is a top-of-the-market fixer-upper.Malibu real estate agent Alan Mark, left, and his son and partner, Tony, stand near a beachfront fixer-upper with a $15 million price tag. For $10 million, one can buy in parts of the Westside and the San Fernando Valley, Alan Mark says.