The new MB Market Update spreadsheets are available: download the 3/31/08 update by clicking here, or at any time by using the link at the upper-right corner of the main MBC page. Information in this update closed March 31.
We now split up the discussions of our 3 areas west of Sepulveda into separate articles. You can download the complete spreadsheet now or any time. Articles on the Sand Section and Tree Section will follow.
Total SFR inventory west of Sepulveda was at 97 on March 31, +7 from the middle of the month and +13 from the end of February. [Note that this is 2 higher than we noted in the first version of our recent story ("Inventory Swelling"), due to one new listing and one apparently failed escrow.]
This is the highest SFR inventory MBC has published in one year-plus of operation, though we're assured that these levels were met and exceeded in prior years – pre-boom, mainly.
In this 2-week period in March, there were 18 new listings, bringing the total to 34 new listings west of Sepulveda for the month (although 1 or 2 canceled, we record the total that hit the MLS at some point). This total of 34 was also a record for the past year (see graph) – exceeding, by 3, the number of new listings in June 2007, the Summer peak.
We saw a total of 5 sales (new escrows) of SFRs listed on the MLS in this period, bringing the sales total to 13 for the month of March. (In our subject region west of Sepulveda.) By comparison, there were 19 total sales (new escrows) in February.
Let's put those all together…
- More new listings than in any month over the past year.
- Fewer sales this month than last.
- Higher inventory than MBC has recorded in 1 year.
Let's look at one of our areas in detail.
Hill Section
There are 16 active SFRs.
Three new listings came on during this 2-week period, including 2 that readers will find familiar, though they took their 60-plus days off the MLS and we treat them as "new." As always, click on any highlighted address for more pics & details via Redfin:
617 6th is a big new home (not quite complete) just a couple doors up off of Ardmore – high enough to garner some ocean views. Offers 5br/5ba and almost 6000 sq. ft., and starts at $5.950m.
- 402 Larsson was with us for almost 3 months from early October 2007 till year end. It was in foreclosure and faced a late-December auction date. We do not believe it was sold, however. The recent open-house listing called it a "for sale by owner" situation, and we're fairly sure that's the longtime owner doing the selling. By the way, the home is a 3br/3ba, 1800 sq. ft. fixer on the "wrong" side of Larsson, asking $1.050m.
869 3rd is a sleek, modern home built in 2000 with 4br/5ba, 4100 sq. ft. and a decently sized, 5700 sq. ft. lot (now with a basketball court out back).
MBC has noted before that this one is owned by two local real estate agents who purchased it for about $2.4m in May 2004. (See "Two Views from the Hills" from last July.) Last year it began at $3.995m; it's starting its second run now at $3.750m.In the rest of the Hill Section, there was not much activity. No new sales and no closed sales.
We did see two noteworthy price cuts. At 701 Dianthus, a listing that began at $2.775m only 2 months ago is down $200k to $2.575m. The sellers, who are said to be facing a job transfer, paid $2.530m – just $45k less – only 2 years ago in Feb. 2006. They then put $150k into upgrading the home, but the price is flat now, taking no account of the upgrades.
Meanwhile, 811 Boundary continues to flatten out, getting closer and closer to its September 2004 purchase price. The sellers paid $1.789m then, and are now asking $2.099m (+$310k/+17%). That would still be a nice profit, but it's $500k less than they wished for when they started last June.
37 comments:
Let the flipping wars on Tennyson begin.
Where is the Bottom in Housing?
Bottom Line? There is no Bottom in Sight
The Real ARMs Race
By John Mauldin
http://www.frontlinethoughts.com/pdf/mwo032808.pdf
What is so great about the Errol Flynn owned home that just opened near the beach??
This house is hideous, i'm sorry.
6.5 mil!!!!???
Oh, more new listings + less sales action = should be a spring to remember!
MBRenter what do you mean about the flipping wars?!
anybody here know Christine Broadhurst from American Martyrs days?
I've followed the comments on this blog since early last summer and the Bulls keep changing their story.
First, Manhattan Beach was immune to the housing downturn, then West of Sepulveda was immune.
Now it seems the Tree section and Hill section have lost their strength.
Next it was the Sand section West of Highland, then the Walkstreets West of Highland, and most recently the Walkstreets that are West of Highland and South of the Pier.
What's next?
90266 - I too have been following the progression of these "sub" to now "mini-market" arguments. If we were to meet these people face-to-face, do you think they would be able to even say these things with a straight face?
Since the only way to pretend to have authority here is to be anonymous, I'll just do that.
Your raw numbers are interesting, but given the field, quite low and subject to noise. You might try running a boxcar smoothing over them and charting that. Just a suggestion.
I've done the smoothing for SFR sales for all of MB (12-mo. running avg.) in a previous story. I'll update that when I get a final SFR sales total for MB for March. I think it's around 18.
Do all homes for sale have to be listed with MLS? Can a buyer list a home on real estate web sites and not the MLS? Interested buyer wondering where to get ALL the listings.
Barring some bizarre state law (which the NAR would probably love to have), houses do not have to be on the MLS to be for sale. Even greyer than that, sites like Zillow have a "make me move" feature where you can indicate for the right price that you will sell your house. Is a house listed like that for sale or not? Ick.
The key, usually, is to keep measuring the same way so the data are comparable, unless you have a darn good reason for changing the methodology (e.g., increasing % of FSBOs) and if you do, you need a big fat asterisk on every chart after that.
I have a comment in general. How do you decide which houses to go to? The pictures on redfin are hideous. Even if the houses were 1/10 the price, the agent should be able to afford a decent dual-lens point and shoot along with a class in how to take a picture. Gads.
"I've followed the comments on this blog since early last summer and the Bulls keep changing their story.
First, Manhattan Beach was immune to the housing downturn, then West of Sepulveda was immune.
Now it seems the Tree section and Hill section have lost their strength.
Next it was the Sand section West of Highland, then the Walkstreets West of Highland, and most recently the Walkstreets that are West of Highland and South of the Pier.
What's next?"
What's next? Another stupid comment from you, Nick.
What bulls are changing their story? The fact remains that good homes in the tree section are selling. There is a lot of evidence of that. The standard 3200 sq foot new construction crud is not selling. Nor are the over-priced, swing and a miss homes. The fact that homes are sitting for 3 months tells me that things are coming back to normal. It wasn't that long ago that homes would actually take a while to sell. I remember when my wife and I sold our first home here. It took 4 months. We were happy that it sold so quickly! I think that the impression of 4 months being a long time shows the inexperience and "youngness" of some of the commenters.
90266: I noticed the same thing...not a stupid comment at all but rather an observation.
Anon 11:29am said:
"The fact that homes are sitting for 3 months tells me that things are coming back to normal."
According to you, we're past the micro-areas debate, and MB Real Estate is all "back to normal".
Next you'll say "It's only East Manhattan that isn't normal anymore, but West of Sepulveda is..." and so on, and so on...
Dear Professor Experienced, would you call this economy normal too?
I guess I have to spell it out for you (not shocked by that).
Seeing homes sit for a while is a NORMAL thing to observe.
Seeing people negotiate the price of a home (instead of a free for all) is a NORMAL thing to observe.
Seeing bad houses sit for longer is a NORMAL thing to observe.
No where did I say it wouldn't go beyond NORMAL (ie, homes sitting for 9 months). All I said is that good homes are and will continue to sell. To repeat what has been said numerous times, this downturn observed across LA (and the US) is/was loose-credit-driven. Housing farms (ie, IE) where there are developments after developments will get hit hard by this easy money tide turn.
That being said, I have no reason to be bullish or bearish. I am not selling my home for a very, very long time (custom home created by yours truly), nor am I trying to buy a home.
"Custom home," eh? Very impressive.
To me yes. To others, probably not. It isn't like I have a pool on the second floor!
"Let the flipping wars on Tennyson begin"
What does this refer to?
12:27/2:54, better watch out. To people like 90266, you are the enemy, probably because you have what they want, a nice home, while their landlord refuses to fix the toilet.
I too was here through the last downturn. This is nothing by comparison but people like 90266, anon7 and their ilk light candles every evening hoping that it gets worse.
Fortunately, even if the market tanks (hasn't yet), it won't affect either of our housing circumstances I'll wager.
"Fortunately, even if the market tanks (hasn't yet), it won't affect either of our housing circumstances I'll wager."
I don't know about that! I still owe $114,234.53 on my mortgage! If values drop by 96%, I might get a call from the mortgage company!
12:27 p.m.
Finally once again a real voice of reason. Your comments are right on. It will still be difficult for some of the mor...oh wait I can't say that any more, I mean highly intellegent people on this board to understand.
I'd have to agree with 90266 that the bulls have been gerrymandering their argument a bit more than the bears. It seems that most new data tends to support the bears, but the bulls can stil point to the median stats and a few homes that sold quickly. Hmm, who to support?
Despite historical means and medians, seeing homes sit for longer and longer amounts of time - the inventory trend line - does not bode well for those who would declare the market bottomed or stabilized. Also, accelerating price reductions in the majority of MB neighborhoods, low total sales across MB, bad lending environment, bad national economy, and horrible sentiment do not help the case for those who would paint a positive picture of the market. So, if you hang your hat on the strength of the most premium of premium properties and the healthy median price (skewed by healthier market for the absolute best quality sites), then you are probably in some sort of denial. You have to fight the good fight though. Or else it's like you just rolled over and handed back your equity.
4:16pm: Huh? What data? Few homes that sold quickly? Let's see. Good homes sell quickly. Crap sits. Average stuff takes time. Are we looking at different data? Inventory? Yes, in the record length of time MBW has been doing this, it is higher. That is all of one year. To get a reasonable avg, you need to look at historical bull and bear mkts for comparisons, not the last year.
As has been noted elsewhere, inventory was higher in the first half of 2002 and the last half of 2006 than it is currently in Manhattan Beach. A little historical perspective is in order before the bears (aka losers) can start prancing in the streets in celebration of their long hoped-for market crash.
Also, median sale price for the 47 single family homes sold in the first quarter, according to the MLS, was $1,840,000. First quarter of 2007 was $1,680,000. I know, bears, there was a sharp decline in sales (over 50%) but maybe you all can remind us again why median prices are completely irrelevant. I suspect it's because you all don't like any stat that disproves the collapse of the local real estate market that you've been praying for.
First you tell us the market is collapsing because no one can get jumbo loans anymore which affects high-end homebuyers. Then when a disproportionate number of high-end homes sell, boosting the median sale price, you say the market is collapsing because the sub-prime mess has hit starter home buyers the hardest.
Would be nice if the bears could come up with a consistent story (for once). Oh, and several high-end Tree section sales will be hitting the MLS soon - sorry, bears.
I appreciate the work put in by MBW. However, many times the stats make people way too anal about MB real estate. Sorry, I've been here 30 yrs (thru 80-82 & thru 91-94, and this is nothing like those scary years). AH7, you can copy and paste and paste and copy and, oh, your vocabulario, quite impressive. Go on, dwell on the statistics. You can do that for a life time. But the reality here is that MB is a great place to own, a great place to live, a great place to raise kids, great people, great weather . . . need I go on? Go ahead, bash me and the other rational thinkers on this site. We really don't care because we own here. I don't care if prices go down, 'cause I don't want to live anywhere else (although I do have vacation homes). The fact is, if you want to live in LA and you have a chance to buy a nice home that you like in a great community, not a marked up piece of trash, and you are going to stay here, it's a good time to look in MB. The reason is because there is so much inventory. I remember times when I wanted to move and there was virtually nothing available, or you had to compete with 5 other buyers. It really sucked. If I didn't already have my dream house, wanted to live here, and could afford it, I'd be out looking and dealing. To hell with the LA median, Case Shiller, the NY Times or opthamologists (man that's a long word) who choose to live in Redogdoo. They can do what they like. To me, I'm happy to be here. By the way, I have vacation rentals here and I have to turn people away. Go ahead, trash me. No stats here. Just experience and a great life.
10:33 - a friendly correction – I don't think a "disproportionate" number of higher-end homes are selling. At least, not as of a few days ago. The proportions of closed sales matched pretty closely the numbers of homes in various price ranges a few days before the close of the quarter.
Admittedly I haven't yet followed thru on a reader's request to change the tiers I used the first time I offered that analysis.
I don't know that this finding argues one way or the other. A 50% drop in sales volume seems significant, though.
10:47 PM:
I don't think many bears on here, including Anon7, Mookie, and myself, would dispute any of the positive attributes of life in Manhattan Beach that you stated. And congratulations for having so many homes here. Great for you.
But I think what many of us bears (aka losers, per 10:33) are saying is that we believe home values are headed lower. We will debate the severity, but many of us believe beyond doubt that prices are headed lower.
And if I can afford to buy here, it doesn't make me any more right or wrong vs. someone who can't afford to do so. That's completely beside the point. As is the fact that you own so much property here. It doesn't mean your opinion carries any more weight.
50% Drop? There you go again MBWatcher with another meaningless stat. Face facts. Manhattan Beach is the greatest city in Southern California and prices will continue to rise. Those who disagree don't own their home here or any vacation properties. It's just sad, really.
From MBWatcher: "I don't know that this finding argues one way or the other. A 50% drop in sales volume seems significant, though."
Drop from what? From a crazy period where everything was selling? Again, you fail to look at longer term trends. This "significant drop" is going back to normal. I realize you have only been doing this for one year, but you have to put some more thought into your comments (not your write ups; I like those...your comments. It is almost like you hand the keyboard over to someone else to respond to the comments).
7:19, Agree re/"crazy period", those who bought then will be considered "crazy" in the not too distant future.
“Normal” activity? No such thing. Just like "normal" weather, "normal" re sales activity is nothing more than a mathematical average based on multiple "abnormal" sales periods. It's the current trend that counts and that trend is toward higher inventories, tighter/stricter credit and lower prices. How steep and how long the trend curve proves to be can only be ascertained when the trend changes, which looks at this point to be years away.
7:35am: thanks. that post made absolutely no sense. maybe tomorrow, put less "irish" in the irish coffee.
50% sales rate decline from last year. More on that shortly. Was last year "crazy?"
BTW the 50% drop came from 10:33pm's post which was more from the other perspective; forgot to cite the source.
The first half of last year was crazy, as was the first half of 2006. Closed sales in both halves were more in line with the previous boom years; sales dropped off dramatically at the end of both 2006 and 2007 (even more than would normally be expected from seasonal factors). We know why 2007 sales faltered in the latter half of the year; not sure why they fell off in the latter half of 2006.
MBW said: "50% sales rate decline from last year. More on that shortly. Was last year 'crazy?'"
You have the data. At least look at it. Credit tightening didn't happen until last week of July/first week of Aug when the market reacted.
Anon 10:47, we'd be more convinced of your happy life if you didn't sound so angry.
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