Weekend Opens (March 1-2)

Another weekend, another crop of opens...

As always, you can use the link in the sidebar in the right-hand column under "Prop. Search Tools" to see the complete list (via the Beach Reporter) any time, or click here for the complete list now.


Hill Section

916 9th was one of MBC's favorites in 2007 and is Mrs. MBC's pick of the week. The sellers began at the lofty price of $3.275m last year; they're starting this time at $2.895m. The great room/back yard combo is very large and almost perfect. Open Sun. 1-4pm.

923 1st was briefly the most expensive listing in MB, but a nicer home came on at $8m and now this one has chopped $250k to $7.750m. Time to let the riff-raff in again. (See "Unpredictable" for MBC's review.) Catch the sunset at a special open house Sunday: 4-5pm. And don't let them tell you it's "invitation only" – it's in the Beach Reporter!

Finally, 1100 John is newly up on offer at $1.259m. You might note that the little slug on the BR listing says "great location." We honestly can't imagine why they're saying that. Sun. 1-4pm.


Sand Section

Need a South End walkstreet home? Both listings on 6th St. are open Sunday – 408 6th ($2.340m) is open from 2-4pm and 528 6th (still $3.449m) from 1-4pm; 528 is also open Saturday. If you see 528, ask about the square footage. (See "Buyer, You'd Better Verify.")

228 29th Place spent 7 months on the market last year, starting at $3.049m. It's a custom modern home that's very crisp and offers lots of wows, though it's not for everyone. It's now up anew at $2.629m (-$420k/-14%) and is worth a look. It will sell this year, somehow. Sunday 1-4pm.

Go way up above Highland to see 429 29th Place, and for half the price ($1.249m) there's a little Spanish cottage with an ocean-peek deck.


Tree Section

534 14th is a large contemporary (ca. 1990) with sharp angles and ocean views. Not a home for young kids. That's not MBC's opinion – it's actually in the listing. Oh, and there's also the police report of crack-smoking and knifeplay on this very block just a couple weeks ago. (See the current Beach Reporter.) Unfortunate timing. Start price: $3.350m. Open Sun. 1-4pm.

3307 Poinsettia is new construction in the Trees, 5br/5ba and 3250 sq. ft., starting at $2.795m, very high PPSF ($860) given an average closer to $700 or below on most sales in the last 6 months. Open Sat. & Sun., 1-4pm.

Also, the Asian-inspired contemporary at 794 27th (at Pacific/27th) is worth a mention and a tour because it's cool, because it was featured in last weekend's LA Times "Hot Property" column and because, despite those things it has going for it, the owner this week decided to sell for a loss – it's now at $2.399m, down $200k from start and -$101k from the May 2006 purchase price. Open Sun. 1-4pm.


East Manhattan

We can't sort through all the options for you, but we'll say this – there seems to have been an explosion of inventory in East Manhattan over the last week or two. If that's where you're looking, check the listings and drive around; there are lots of new ones.

February Brightens

Try and put aside Thursday's foggy weather. The story of February for local RE was quite a bit sunnier, particularly when measured against Q4 2007 and January '08.

The two most recent months saw sales of SFRs west of Sepulveda in the single digits – 9 in December and 7 in January. Currently, we've recorded 17 sales (new escrows) in our subject region in February. Several have posted in the last 2-3 days, and there's still a leap day left for more to be posted.

The deals made so far include 1 in the Hill Section (forgettable 1019 11th) and 8 each in the Sand Section and the Trees. We'd call 3 of the Sand Section sales possible lot sales, while 2 were new construction – including delicious 200 19th at $5.849m. In the Trees, 3 new homes, 1 great remodel (2317 Pine), and 3 under $1.5m.

The region is still off the 2007 pace for the same month, though we can't say with certainty by how much. (MBC's public tracking began a bit less than 1 year ago, so we can't compare apples to apples.)

For some perspective, however imperfect, consider that in March 2007, 50 SFR sales closed in all of MB – not just west of Hwy. 1 – which means February was like a rocket launch last year. (Closed sales in March are a rough reflection of February activity, with average escrows of 30 days.) The previous years saw 40 closed sales in March 2005 and 36 in March 2006.

Given that SFR sales west of Sepulveda are generally 2/3rds or more of the MB total, we can estimate that sales in our subject region were around 25-35 in February of each of the last 3 years. Still, even if this year is falling short, the improvement is noteworthy.

New inventory coming on in February has substantially exceeded new sales, though this should be no big surprise given seasonal factors. We added 30 new listings in February against those 17 sales.

Total inventory recorded by MBC is at 85 with one day left in February, the highest total we have yet recorded – even with the sales activity.

They've Got Plans

Sometimes you can get more than a house when you buy. You can also get someone else's ideas for how to make it better.

In a few cases with current listings, the seller is offering plans for a remodel or new construction as part of the deal.

2808 Manhattan Ave. is the newest entry. (Click address for details, including a satellite map, via Redfin; no pics yet.) For $1.799m you get a 2200-sq.-ft. lot, plus:

[P]lans for a 3,300 sqft single family home which includes 4 bedrooms, 4 baths, living room, formal dining room, recreation/media room, elevator & 3-car garage. Plans have been approved by the city.

It would appear the sellers were ready to build in a great part of town west of Highland, and just couldn't, or wouldn't, pull the trigger. A buyer could probably get from here to move-in day for $3m or so.

Would-be spec builders, beware: A new home just a couple doors down at 2816 Manhattan Ave. – a 2500 sq. ft. home on a 1750 sq. ft. lot – tried for $2.9m, and wound up selling for $2.55m last July after 9+ months on the market. Sure, west of Highland is great, but that doesn't mean people are writing blank checks to get in.

Plans that are somewhat less concrete than those city-approved plans on Manhattan Ave. are available to the purchaser of 305 Gull. This small duplex fronts Highland and is quite close to the challenged new home at 45th/Highland (4419 Highland). Take this little duplex for $1.049m and you can convert it back to an SFR or take advantage of this bonus:

Seller has conceptual plans for a two-bedroom two-bath addition for this 1,590 square foot corner lot.

We're assuming these "conceptual plans" are more valuable than a 30-minute chat over coffee about how you could some day push out over the parking area and get some more square footage. We're assuming that. It's our generous side.

Elsewhere, 626 Rosecrans was briefly the cheapest listing west of Sepulveda, at $799k. It was cheap because the house, while spiffy, was also tiny at 608 sq. ft., and the lot is small even for the Tree Section at 3625 sq. ft. Oh, and note the Rosecrans factor.

Still, 626 Rosecrans is in escrow now after just 33 days. Maybe one sweetener was the "plans for a large 2000sf addition," free to the buyer. Imagine that: for $1.3m-$1.5m or so, you can have a 2600 sq. ft. home on Rosecrans, if you take it all the way. Bargain... ?

Finally, as MBC noted in the recent Market Update, 3521 Elm is now on the market for the 3rd time in a year. First it was a "perfect starter home" at $1.3m, then it sold for $1.150m to a builder last Summer. Now it's back at $1.225m with "plans for a 3300 sq. ft. 5-bedroom Tuscan-style home."

This seems to be a clear case of a spec project that's been abandoned. Someone took a hard look. The calculation must have been something like this: Really, how many new Tuscans in marginal locations are going to be selling next year, and the year after that, for $2.3m?

Better to get out of it now and let the next person frame, emboss, embrace or dump those plans.

Early Warning: Ask/Close Spreads

The national news this week is again full of tales of home price reductions. Whether you go by median prices or the Case-Shiller index, sales that are happening so far in 2008 are coming in at lower prices than last year.

Today let’s look at recent MB sales from a different angle: what some call the ask-close spread. Basically we’re looking how much recent sellers got, compared to their own starting prices.

The short version:

• Recent Sand Section sales fared best, with most sales closing within 10% of their start prices.

• In the Hill Section, a small sample of 4 sales saw 3 close with cuts of 15% or more.

• In the Tree Section, resales had spreads of 11-16% off their start prices, with most at the higher end of that range; most new construction took cuts of about 15%, and a few builders lost money on their projects.

Now, what you make of this data – we’ll dump the whole lot of it on you in a moment – depends largely on what you think start prices mean.

We tend to agree with the view expressed the other day by Blake Roberts on his local RE blog, that setting a list price is more of an art than a science. It has to be, with so many variables in play.

Still, listing agents are looking at many of the same factors in coming to judgments about the right start prices. There’s a collective wisdom expressed in the advice they give as to what the market will bear. Sellers, of course, make the final call.

Sellers who are unrealistic about price, but later get religion and make a deal, are going to be responsible for some big, big ask-close spreads, if they sell at all. Sellers who are very aggressive on price will have tiny spreads, or may sell above asking.

We think most sellers fall in the middle, and, for this reason, asking prices, and ask-close spreads, truly do provide useful information.

In the samples provided here, almost uniformly, the start prices were substantially too high. To make a deal, sellers needed to come down 10% or more, often substantially more. These cuts, while they only compare against the same homes' start prices – not any broader trend in the market – nonetheless provide a possible early warning that prices are correcting significantly.

Dollarwise, the cuts are occasionally drastic, in the many hundreds of thousands of dollars. Indeed, our cocktail-napkin calculation shows that buyers saved almost $8 million in total on just the selection of homes listed below.

We should emphasize: MBC is not cherry-picking data here. We’re looking at all of the most recent sales of SFRs west of Sepulveda that were listed on the MLS. Our goal was to pull the 5 most recent sales in each region under study, but we went a little further or shorter in a couple of cases. We’re excluding only lot sales – a different market.

All of the following recent sales are organized by the date of closing. Sales are separated by region (Sand, Hills, Trees) and we’ve subdivided the Tree Section to show new homes separately. Also, note that some homes may have re-listed before selling, confusing the issue of what their start prices were – we’re going with the original price, naturally:

Sand Section

• 2008 Highland (4/3, 2325, newer) – start: $2.295m • DOM: 32 • close: $2.175m (11/20/07)

Reduction: -$120k / -5%

• 209 19th (3/4, 3350, remod) – start: $3.95m • DOM: 153 • close: $3.675m (11/20/07)

Reduction: -$275,000 /-7%

• 209 42nd (3/4, 1950, new) – start: $2.3m • DOM: 403 • close: $1.835m (11/21/07)

Reduction: -$465,000 /-20%

• 1312 Manhattan Ave (4/4, 1650, remod) – start: $2.85m • DOM: 420 • close: $2.6m (1/15/08)

Reduction: -$250,000 / -9%

• 117 Highland (3/2, 1500, remod) – start: $1.449m • DOM: 250 • close: $1.275m (1/08)

Reduction: -$174,000 / -12%

We’re excluding teardowns in general, but we note that 129 6th started at $3.9m and sold for $3.625m (2/20/08), a reduction of $275k / -7% after only 20 DOM.


Tree Section – Resales

• 3011 Elm (5/5, 3600, newer) – start: $3.095m • DOM: 196 • close: $2.650m (12/7/07)

Reduction: -$445,000 / -14%

• 1732 Pine (4/2, 1550, dated) – start: $1.295m • DOM: 114 • close: $1.130m (12/23/07)

Reduction: -$165,000 / -13%

• 3300 Blanche (5/5, 3375, newer) – start: $2.659m • DOM: 38 • close: $2.360m (1/8/08)

Reduction: -$299,000 / -11%

• 637 13th (3/2, 2000, dated) – start: $1.585m • DOM: 110 • close: $1.335m (1/9/08)

Reduction: -$250,000 / -16%

• 2623 Palm (3/2, 1950, remod) – start: $1.599m • DOM: 76 • close: $1.350m (1/16/08)

Reduction -$249,000 / -16%

• 725 12th (3/2, 1300, remod) – start: $1.4m • DOM: 104 • close: $1.187m (1/18/08)

Reduction: -$213,000 / -15%

• 2413 Elm (4/3, 3300, remod) – start: $1.799m • DOM: 149 • close: $1.575m (1/31/08)

Reduction: -$224,000 / -12%

• 561 35th (6/5, 4350, remod) – start: $2.199m • DOM: 172 • close: $1.850m (2/12/08)

Reduction: -$349,000 / -16%

• 2311 Poinsettia (5/3, 3400, remod) – start: $2.149m • DOM: 200 • close: $1,850,000 (2/17/08)

Reduction: -$299,000 / -14%

Tree Section – New Construction

• 2310 Palm (5/3, 3150, new) – start: $2.699m • DOM: 443 • close: $2.2m (12/3/07)

Reduction: -$499,000 / -18%

• 2807 Elm (5/5, 3550 , new) – start: $2.899m • DOM: 139 • close: $2.1m (12/14/07)

Reduction: -$799,000 / -28%

• 648 35th (5/5, 3600, new) – start: $2.45m • DOM: 142 • close: $2.075m (12/27/07)

Reduction: -$375,000 / -15%

• 2612 Poinsettia (5/5, 3200, new) – start: $2.399m • DOM: 482 • close: $2.199m (2/8/08)

Reduction: -$200,000 / -8%

And while we don’t have a closed price on 2100 Flournoy (4br/5ba, 3600, new) yet, we’ll note that it began at $3.2m, spent 162 days on market, and, if it closed for the rumored sale price of $2.75m, it will show a reduction of $450k / -14%, quite consistent with the other newbies listed above.


Hill Section

• 844 11th (5/4, 4500, remod) – start: $3,175,000 • DOM: 540 • close: $2.5m (11/28/07)

Reduction: -$675,000 / -21%

• 601 Larsson (4/4, 3850, remod) – start: $2,695,000 • DOM: 239 • close: $1.710m (12/27/07)

Reduction: -$985,000 /-37%

• 853 6th (6/4, 4925, new) – start: $4,795,000 • DOM: 198 • close: $4.5m (1/11/08)

Reduction: -$295,000 / -6%

• 911 Duncan (5/6, 3700, new) – start: $3,770,000 • DOM: 226 • close: $3,190,000 (2/25/08)

Reduction: -$580,000 / -15%

In the Hill Section, we’ve eliminated 3 recent teardowns/lot sales. One sold for asking, one sold off the MLS and one sold within 3% of its list price.

Great Streets: Pacific (Hills)

Depending on where you live or drive around town, you might have very different ideas about Pacific Ave.

In the Trees, Pacific can be just plain busy – i.e., not very "pacific." If you're headed north in the morning (or any time), you've got refinery stacks in your sights as you shuffle toward Rosecrans.

But whoa, what a completely different story Pacific Ave. is over in the Hill Section. It's perhaps the city's premier ocean-view street, particularly in the stretch between 6th-10th St. Here, "Pacific" actually means you will see a lot of the Pacific Ocean. Big-blue-marble-type views. (Those power lines are on the way down.)

In short, when you say "Hill Section" and think "ocean view," Pacific ought to be your next thought.

(Please forgive MBC for the moderate quality of our snapshots. John Post hasn't returned calls seeking free services on our behalf. To be honest, these are views that are awfully hard to take in adequately as a single person scanning the horizon; a mere camera is just going to chop the experience down further anyway.)

There's one active listing that takes full advantage of this view: 700 8th, just a couple of doors west of Pacific. The sellers seek $8m there, banking in part on the views.

Another big factor in Pacific's favor: The relative homogeneity of the newer construction. There is a fairly long stretch at the top of the hill in which all the homes share a similar style – call it "Cape Cod" if you will. (Who are these Boston people naming our beach-style homes?) Several were built in the same period of the mid-late 1990s.

Maybe you don't realize how choppy, uneven and disconcerting the newer development in MB really is until you see a row of homes that are stylistically consistent with one another. On Pacific, particularly on the view side, you've got classic beach estates uncluttered by Caliterraneans, Tuscans, Contemporaries and Old Shacks. Did someone actually develop a vision in this area, somehow?

For the views and the vision, Pacific is one of MB's great streets.

Such a Deal on Duncan

When 911 Duncan first hit the market in June 2007, the builder/seller had high hopes. The listing began at $3.770m.

The build was a unique, custom design, memorably touted for some time as a home that supposedly evoked Frank Lloyd Wright's "Fallingwater" – with a grass driveway on Duncan apparently subbing for the forested setting of the Wright home. (We kid.)

By the 6-month mark, 911 Duncan wasn't moving, so the price did – down $470k to $3.299m. As MBC noted in "Fallingprice," this was the greatest drop in new-construction pricing in the Hill Section in 2007.

Now, with a closed price coming in at $3.190m, we can shut the books. The final price was -$580k/-15% off that optimistic start. That's the new record for cuts on new construction in the Hills.

And yet, to those who thought the home would wind up selling for closer to $3m, or perhaps below, the builder had the last laugh. With land acquisition costs of just $950k, and a home built with 5br/6ba, 3700 sq. ft., we're confident that the builder made some real money. Such a deal for both parties, no?

Movement on the Perimeter

One factor that will tend to make the local RE market sluggish is when buyers get picky about location.

Oh, we know, location (x3) is the RE mantra. Everyone knows location is important.

But in more frenzied times, buyers' goal is to buy something, anything, ASAP, and not to let a specific street or location trip them up. If they're trying to buy the ZIP code, after all – or the school district – they might look past things that suddenly seem important when they have a choice, like those refinery stacks they would see each morning out the kitchen window as they make the kids' lunches.

In a calmer market like today's, sellers can overcome their homes' location issues only with realistic pricing, or big adjustments.

In the last few days, 2 listings proved that location issues need not be insurmountable:

790 Rosecrans (pictured above), which MBC has described as both "lovable" and "awful," is just a tired, older home that looks out on an entry/exit gate for the refinery. Because it's fairly large (3250 sq. ft., though just 3br), the sellers no doubt felt justified starting the price near $1.6m ($500/PSF) on Aug. 1, 2007. By December, the price was down almost $300k to $1.295m, where it lingered till the sellers made a deal in the last few days.

That latest list price equated to $398/PSF – a new low for the Trees in recent times – and you might assume the final price is lower.

3613 Oak (pictured at right) presents a different kind of case. It's on the small side (3br/2ba, 1400 sq. ft.) and, as we noted in the Market Update just a few days ago, it's got "a big location issue – just off Rosecrans, facing out onto a commercial building."

Oak, Rosecrans, commercial – a triple whammy.

Defying the odds, the sellers made a deal within 2 weeks. Maybe that's because they did not overreach on price. They began at $1.089m, a price that would help them to almost double their money (they paid $555k in Aug. 2001).

Let's face it, a million bucks is still a lot of coin for a small home in a sub-subpar location like this, but Oak also had the lowest start price for any livable, 3br home in the Trees that we have seen in a year, probably much longer. (MBC has been publicly tracking for a year.) That's how you make it happen.

Recently the proportion of SFR inventory in off locations has been growing. The sellers will all have to deal with the price impact of pickier buyers.

Let's count first just by looking at homes that, like 790 Rosecrans and 3613 Oak, are on the outer perimeter of our subject region west of Sepulveda.

Start with Oak Ave. in the Trees. Entering Monday, there are 6 active listings on Oak, 2 of those on the "wrong" side (east/Sepulveda side). There was 1 more on Larsson, Oak's equivalent in the Hills (it's also on the "wrong" side). Add 1 more home on Rosecrans. We've counted 8 on the outer-most perimeter.

Now add 8 more listings in the Trees on 35th St. or north of it, an area where – in many cases – the refinery is a profound presence. Add 1 more from the Sand on 36th Pl. with refinery issues (among others; see "A Real Turkey").

That's an impressive 17 listings (out of the 84 total active SFRs) around the less-desirable outer rim.

We also need to consider busy streets:

• 3 listings on Highland;
• 2 on Pacific;
• 1 on MBB;
• 1 on 2nd in the Hill Section; and
• 1 on Blanche (in addition to 1 already counted above).

So we're at 25 out of 84 – nearly a third (30%) – in which location is an easily identifiable problem. That's before we start talking about homes on alleys ("Places"), homes on other so-so streets or quaint homes sandwiched by big boxes, all real location issues.

Once buyers extract their price (cuts) to get the more marginal homes sold, comps for everyone are affected.

Some sages say it's the marginal listings that ultimately define the market. We don't have many distressed sellers (foreclosures, short sales) at this time, but we've got plenty of location-challenged inventory. These listings could prove to be the leading edge of a wave of price-chopping – at least those that can make a deal.

Weekend Opens

There are not a bunch of new listings this week, but here are some that are worth a look this weekend if you're out:

131 Kelp (pictured; click for details via Redfin) is a small 2br/2ba, 1400 sq. footer in El Porto – er, "North Manhattan Beach." (Did you know there's a street in MB named Kelp? It's between 40th and 41st.) It's cozy but on the cute side. Where else can you get ocean views (from the deck) for $1.095m? Open Sun. 1-4.

At the other end of town, lovers of the South End might love the southernmost offering in MB at 207 Homer. (Did you know there's a street in MB named Homer?) This one can be tough to find: go a half block south of 1st St., then look just east of Manhattan Ave. (Former address is 80 Manhattan Ave.) Built in 1967, the home offers 3br/3ba and 1800 sq. ft. for $1.779m. (No pics in the listing as we post, but they should come up shortly.) Open Sun. 1-4.

In the Hill Section near downtown, you can peek at the peculiar "flag lot" home at 612 11th (see previous story, "Flag It As Overpriced"). Open Sat. & Sun. 1-4.

In the Trees, check out 3516 Palm (5br/4ba, 3250 sq. ft.) (pictured), a sharp, newer home that starts at $1.849m. Open Sun. 2-4.

Also 523 Marine, which was on the market about 6 weeks ago – no, we checked, it was in Summer/Fall 2006. It's a cute cottage (3br/2ba, 1625 sq. ft.) that was purchased for $1.310m in Sept. 2006, and is now up at the fairly flat price of $1.379m.

No pick from Mrs. MBC this week, however. She needs to be wowed.

Click here or, any time, in the right-hand column of the front page under "Prop. Search Tools" for the complete list of open houses via the Beach Reporter.

Flag It As Overpriced

Just last year – in April, in fact – someone tried to sell a peculiar house in the Hill Section for less than a million dollars.

It didn't work.

Instead, they sold it for almost $1.3m.

Peculiar 612 11th St. came on the market at $975k and sold for $1.275m in less than a week. (Presumably due to multiple offers.)

Now, peculiar 612 11th is back. (Click address for details via Redfin.)

And this time the sellers shouldn't have the problem of managing a bunch of overbids. They're starting at $1.599m. That's +$324k/+25% over the closed price from last May.

Why do we keep saying "peculiar?" It's the strange "flag lot." This is a polite way of saying it's the back house on a lot appears to be split in two. The "flagpole" is your driveway access to 11th.

Last year, we rated the home a teardown on grounds that the listing pitched the sale as lot value, as we recall. Now, the 4br/2ba, 1500 sq. ft. home is still dated, but spiffier. Not $324k spiffier, but improved.

We'll grant that this is a fairly quiet street and very close to downtown. But isn't $1,000/PSF pricing supposed to be for premium product?

As our online link to the Beach Reporter's Open House listings shows, 612 11th is open Saturday and Sunday, 1-4pm, so take a look for yourself.

Rates Spiking Again?

Within a few days, mortgage rates have shot up as much as 1%. This is tied largely to inflation expectations.

Speaking of which, "stagflation" appears to be the buzzword of the day, appearing in headlines and stories in the WSJ, NYT and LAT today. (Opening up lots of 1970s analogies.)

This graph was produced by a free tool at Bankrate.com to show California rates over the last 3 years. Here's another tool hosted at the WSJ using Bankrate data nationwide.

The current spike, particularly on jumbos, mirrors the August 2007 panic when the mortgage meltdown became undeniable. That one eased, but you have to wonder if this time it's different. (One thing that's different is that "jumbos" are being redefined as $730k+, in our area, anyway, but this will take till Summer to sort out.)

Cue Kaye Thomas:

[T]his market is far more like the one in the late 70's and early 80's. The last time I saw rates rise like this they went up 6% in 6 weeks. Believe me this is not a good thing...this is scary stuff folks.

Yikes, Kaye. It could be temporary.

For additional coverage, see Jim the Realtor's blog (San Diego) and LA Land (LA Times).

Run Season Begins

This Saturday morning brings the first of the local school fundraiser runs, a 5k in support of American Martyrs School. The route is all Tree Section, with lots of hilly Valley/Ardmore parts. Weather's looking OK.

Just around the corner, Robinson holds its 5k on Saturday, March 15th, with a route including walkstreets and Valley on the South End.

Grandview's 5k is June 7, back in the Trees.

MBC has previously called out these runs, among others, as some of our favorite parts of life in MB. (See "A New, Unique MB Event," about the pumpkin races.) Frankly, where your humble correspondent was raised, we didn't have this sort of thing, with the closing off of streets for fitness runs (or renowned bike races). Check yourself: It's cool.

If you're so inclined, here's how to register for two of the school runs:

• Martyrs 5k (Feb. 23) – race day registration only, 6:30am-8am (start time) at the school playground (off Laurel/15th); $28/adults, $23/kids

• Robinson 5k (Mar. 15) – Register by Feb. 29 online via Active.com to guarantee a T-shirt (direct link); $20/adults, $15/kids

No info yet on the Grandview 5k (June 7).

Also, on April 12, there's the Hermosa-to-Manhattan pier-to-pier run (4 mi) [see the sponsor's site here]; and – of course – the Hometown 10k in October.

MB Market Update for 2/15/08, Part 3

This is the third and final installment of the MB Market Update for the first half of February.

You can download the complete Market Update spreadsheets by clicking here or by using the link at the upper-right corner of the MBC front page. (Click to read the Hill Section story, and here for the Sand Section story.)


Tree Section

As of Feb. 15, there were 49 active SFRs, 25 of them priced below $2m, and 24 priced above $2m. MBC noted yesterday that having more offerings in the lower segment than the higher segment was fairly new in the Trees, at least since we started public tracking last year. (See "Lines Cross in the Trees.")

There were 13 new listings in this short 2-week window. Some highlights follow (click any address for details via Redfin).

2 new homes, both in off locations, both optimistic on price:

• 1825 Oak (pictured) was custom-built by the owner-occupants, and completed only in November, but they've decided to sell. It's sweet, with 4br/4ba and 3125 sq. ft., but its location is also a challenge. Starts at $2.399m.

• 3500 Blanche is Spanish-inspired, pretty busy on the outside, on a somewhat busy street, offering 4br/4ba and 3300 sq. ft., and starting at $2.549m.

2 high-style modern homes:

• 2310 John (pictured) is unlike its neighbors, with concrete, steel and glass, offering 5br/5ba and over 3500 sq. ft. for $2.2m – among the lower prices per square foot in the market segment at $624/PSF.

• 794 27th is a contemporary Asian-inspired home with great kids' spaces and a great vibe. The seller paid $2.5m (achem, overpaid) in May 2006, and now seeks $2.599m.

2 neighbors on 26th:

• 609 26th begins this year at $2.099m, after trying a while at $2.299m last year. It's huge (3800 sq. ft.) for the price.

• 625 26th offers one less bedroom than the neighboring listing, at 4br/4ba, and 100 sq. ft. less, in a more familiar Spanish style. Sellers paid $1.795m in August 2004. It starts now at $2.185m.

3 truly new listings below $2m:

• 848 12th Ct. is a newer home offering 4br/4ba and 3250 sq. ft. at $1.999m ($615/PSF); the street can be quiet but the back yard abuts a parking lot for a medical building and MBB.

• 1720 Oak is a big home (5br/4ba, 3475 sq. ft.) with a design you'll recognize if you know the general area – several homes with this 3-garage face and similar floorplan were put up in the late 1980s. Starts at $1.650m, with a low $475/PSF accounting for the location ("wrong," i.e., east side of Oak).

• 3613 Oak is quite a bit smaller, at 3br/2ba w/ 1400 sq. ft., and with a big location issue – just off Rosecrans, facing out onto a commercial building. Starts at $1.089m.

3 more listings are comebackers, meaning they took some time off. Of these, we note that 3521 Elm is on the market for a third time in 1 year. It sold to a builder in July 2007 for $1.150m, but it would seem that project is being abandoned. (Good call.) Now, pay $1.225m and get free architectural plans for – you guessed it – a 5br, 3300 sq. ft. Tuscan-style home.

Getting their chops: There were several price reductions in this period, including 4 separate cuts of about $100k each on new construction. At 2100 Flournoy, the recent cut to $2.795m (from a start at $3.195m) may have done the trick – it sold a few days after the 15th. At 1144 Elm, the new price of $1.879m is the lowest we've seen for new construction in a year's worth of tracking.

Gone for now: Just one cancellation this round, at 3009 Poinsettia, a lot sale that began at $1.399m and was last at $1.299m. (See "Last-Minute Lot Shopping.") MBC just discovered that this lot was purchased in early December 2007 for $980k.

We saw just 2 sales (new escrows) in the Tree Section in this period, including one more example of new construction on which the builder likely loses money:

• The lot for 1901 Poinsettia was purchased for $1.45m in October 2005 – the new home there started at $2.499m in August but quickly shot down to $1.999m before making a deal. We're sure that the costs to build a 5br/5ba, 3200 sq. ft. home exceeded the $500k & change between land acquisition and completion.

• The real bright spot in the Trees so far in 2008 was 2317 Pine, which – as we predicted – just did not last. (See "It Can't Last.") This one sold within a couple weeks for slightly over its $1.799m asking price ($1.860m, we're told).

Our spreadsheet also notes another quick sale, at 612 30th (4br/5ba, 3450 sq. ft.) that took place in the prior period but didn't make the update. It was listed at $2.270m.

Two closed sale prices came through in this period. One was for the quite large (6br/5ba, 4350 sq. ft.) home at 561 35th. This one tried to sell in 2006 at $2.299m, and tried again in 2007 at prices ranging from $2.199m down to $1.899m. It has closed for $1.850m (-$349k/-16% off the 2007 start price).

The other closed sale was 2612 Poinsettia, a new home (5br/5ba, 3200 sq. ft.) that was no one's favorite, and which logged 482 DOM. It began at $2.399m all those days ago (Labor Day 2006) and apparently got $2.199m (-$200k/-8%), faring much better than similar new construction these days.

Lines Cross in the Trees

In tracking SFR inventory west of Sepulveda this past year, MBC has broken up the Tree Section into two market segments. Homes offered for less than $2m made up one segment, and homes starting above $2m made up the other.

This dividing line roughly corresponded to resales and smaller homes, at the lower end, versus new and newer homes in the upper segment.

MBC also declared that the market above $2m was glutted, particularly with new construction, several months ago – before it was hip or obvious to say so.

For almost all of this time, the majority of Tree Section inventory was in the $2m+ segment. As this graph shows (click to enlarge), there were even times when 2/3rds of inventory was in the upper segment. Demand was fairly constant through the Spring and Summer of 2007 for homes priced below $2m.

But in 2008, that has changed. We now have slightly more homes on offer in the sub-$2m range (25 versus 24). As the graphic shows, the lines have crossed.

We saw 5 sales of homes priced under $2m in the first 6 weeks of 2008, but 2 of those were new construction on which the prices began over $2m and dropped below. Meanwhile, the inventory in this segment has more than doubled from 11 at year end.

Of the 25 actives on Feb. 15, 10 were priced below $1.3m, and 3 were actually below $1m. It's been a while since we saw so many offerings at those levels. Of course, as inventory grows, there should be more deals at the lower price points.

MB Market Update for 2/15/08, Part 2

This is the second installment of the MB Market Update for the first half of February.

You can download the complete Market Update spreadsheets by clicking here or by using the link at the upper-right corner of the MBC front page. (Click to read the Hill Section story.)


Sand Section

There were 26 active SFRs in the Sand Section as of February 15.

There were two new listings and three comebackers:

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