Tag Archives: real estate climate south bay

It is a rare day when at least one article is not in the news regarding the mortgage meltdown, national foreclosure statistics and concern over the impending tsunami of foreclosures soon to flood the market.

We could blog for days on national statistics – but we’ll let others do that.  We are concentrated on the Beach Cities, specifically Manhattan Beach. We are seeing a local market that is long on buyers and short on sellers!  The frequent topic of discussions among Realtors is frustration at the low inventory of available houses for sale. We brought out two new listings in February—we received offers within days of our market launch.  Both generated multiple offers. One sold close to asking price, the other went overbid!

So what is going on? Has the local market passed the bottom?

It is quite clear that it has!

The Beach Cities residential properties have sold off dramatically in recent months. We see the effects of this fact every weekend at open houses.

We meet many qualified buyers actively searching for the right home but frustrated by the very limited inventory to choose from.

This is exactly the opposite situation that we were observing not many months ago when the market was long on sellers and short on real buyers.

Clearly the local market has passed the bottom of this cycle and, interestingly, has also just barely passed the balance point between buyers and sellers!

Yes, as strange as it may seem from the point of view only months ago, when we had a buyers market for years prior, we are now seeing the local market in the Beach Cities beginning to rotate ever so slightly back to a sellers’ market!

Available inventory has dropped to 3 months of sales activity or less. Much of this available inventory amounts to a “legacy” of overpriced or under conditioned, or both, properties that languish on the market.

Quality, well priced properties that are offered for sale now generate immediate interest and offers.  Proper presentation and pricing for value of properties offered is critical as buyers are still very focused on real value and will not press offer prices much above reasonable, “appraise-able” values.

This is why over priced or under conditioned properties continue to languish.

Consider the following market reports regarding residential properties from our local MLS system as of February 20, 2012:

Manhattan Beach:

There are 91 available and 72 in escrow; so about 1.26 available for every 1 in escrow.

Using an approximate 60 day escrow period Manhattan has about 2.5 months inventory available.

Hermosa Beach:

There are 48 available and 33 in escrow; so also about 1.45 available for every 1 in escrow.

Using an approximate 60 day escrow period Hermosa also has about 3 months inventory available.

Status: Active (48)
		List Price	ADOM	Selling Price	BR	BA	Year Built	SqFt	Lot SqFt
	Min	329,000	2	–	1	1.00	1922	439
	Max	14,950,000	668	–	8	10.00	2012	9,884	59,585
	Avg	1,513,683	117	–	3	3.05	1981	2,074	10,888
	Sum	72,656,790		–
Status: Pending Sale (17)
		List Price	ADOM	Selling Price	BR	BA	Year Built	SqFt	Lot SqFt
	Min	550,000	2	–	2	1.00	1938	756	1,451
	Max	3,495,000	267	–	5	6.00	2012	3,865	6,118
	Avg	1,461,494	98	–	3	3.35	1986	2,119	3,174
	Sum	24,845,400		–
Status: Backup Offer (16)
		List Price	ADOM	Selling Price	BR	BA	Year Built	SqFt	Lot SqFt
	Min	324,900	7	–	2	1.00	1946	756	1,734
	Max	2,899,000	411	–	6	6.00	2006	4,450	42,508
	Avg	1,106,181	102	–	3	2.88	1978	2,029	10,834
	Sum	17,698,900		–

Redondo Beach:

There are 144 available and 136 in escrow; so only 1.06 available for every 1 in escrow.

Using an approximate 60 day escrow period Redondo has only about 2 months inventory available.

Status: Active (144)
		List Price	ADOM	Selling Price	BR	BA	Year Built	SqFt	Lot SqFt
	Min	247,500		–		1.00	1910	410
	Max	6,995,000	676	–	6	6.00	2012	4,283	273,001
	Avg	735,860	87	–	3	2.68	1980	1,836	20,650
	Sum	105,963,879		–
Status: Pending Sale (70)
		List Price	ADOM	Selling Price	BR	BA	Year Built	SqFt	Lot SqFt
	Min	149,900	3	–	1	1.00	1941	619
	Max	1,579,000	349	–	4	4.00	2011	3,448	202,465
	Avg	549,691	64	–	3	2.22	1980	1,568	12,601
	Sum	38,478,369		–
Status: Backup Offer (66)
		List Price	ADOM	Selling Price	BR	BA	Year Built	SqFt	Lot SqFt
	Min	329,000	6	–	1	1.00	1908	761	723
	Max	1,399,000	704	–	5	5.00	2012	4,254	197,362
	Avg	636,152	113	–	3	2.70	1981	1,799	17,751
	Sum	41,986,029

In closing, this is the lowest level of available inventory that we’ve seen in the Beach Cities market in years. While parts of the rest of the country are still experiencing an excess of inventory, here, that phase of the market cycle is behind us.

If you’re on the fence about selling or buying… get off! There’s no time like the present.