Manhattan Beach: Market Snapshot August 25, 2007

Downtown Manhattan Beach

The last three weeks have been like driving a car downhill without brakes. No one knows what will happen at the bottom of the hill but we all hope for a safe stop without anyone getting hurt. There is a lot of speculation about how the woes of the credit market will affect the Beach Cities and Manhattan Beach in particular.

I have no answers because there are no immediate answers...just a lot of questions that can only be answered over time. All I can share at this time is what I do know....

I know that we are not seeing a run up in foreclosures notices in Manhattan Beach and the Beach Cities. I know that if you have to refinance you can get a 90% LTV jumbo loan around 7%-7.5% fixed ( maybe a bit less) or a 6.5% adjustable providing you don't take any cash out and yesterday I heard about a HELOC program that can be used as a first for 10 years at a fixed rate. I know that a number of lenders are making jumbo loans... even some hybrid types of stated income jumbo loans.. with 10%-20% down if you have a good FICO score and verifiable assets. I know people are still buying and selling homes although at a slower pace so far this month. I know that you need to pick a reputable lender who knows the market and can offer you not only sound financial advice but has a lot of connections with a number of lenders.

I know there will be some people who are in trouble and will have to sell. I know there will be some people who will go into foreclosure. I know there will be some short sales. I know there will be some buyers who will no longer qualify for a loan as high as they need to buy the home of their dreams. These are things I know because these things always happen.

I know that in 1979 interest rates jumped from 11% to 17% in less then 6 months and the credit market had almost no liquidity. I know that in the 80's the S & L's went under because of bad judgment by lenders. I know that in the 90's we had massive foreclosures because people lost their jobs and were unable to find new employment. I know that the market always rebounded. I know this market is totally different from others in the past yet is very similar to all of them.

I think we will make it through a little bruised but intact to the dismay of many who are hoping for a market collapse. I know only time will tell where this market is headed. I know that by the time people figure out it is time to buy the best deals will have gone to those who took a chance in the market because this is the way it always happens. Now you know what I know... so let's see what's happening in Manhattan Beach

Manhattan Beach: Market Snapshot August 25, 2007

(click on graph to enlarge)

Market Price Ranges

Manhattan Beach: Market Snapshot August 5, 2007

Manhattan Beach: Market Snapshot July 18, 2007

Manhattan Beach: Market Snapshot June 25, 2007

Manhattan Beach: Market Snapshot June 2, 2007

Manhattan Beach: Market Snapshot May 6, 2007

Manhattan Beach: Market Snapshot April 23, 2007

South Bay/Beach Cities: SOLD.... June 2007

The Strand in Hermosa Beach


No question the local real estate market is slowing but then sales always slow in the summer. Last year at this time the South Bay/Beach Cities market was stalled.. as buyers just simply withdrew. I'm not seeing that this year as buyers are still coming to open houses and I'm getting a lot of inquiries from my websites.

The market is in a real pickle right now as Buyers continue looking closely at prices and wondering if Sellers are going to stand firmon listing prices for their homes or if there might be a little leeway as we hit mid year. Sellers, on the other hand, are wondering if Buyers will finally step up to the listed price or will continue to be selective about price. I suspect they will meet somewhere in the middle.


I know there are a number of sellers who don't want to officially lower the asking price but are hoping someone will make an offer to get things moving. No one wants to make the first move.. Reminds me of teens at a middle school dance.. girls on one side of the room and boys on the other while the music plays and plays.. each one is afraid to be the first on the floor.

I've added a new feature as requested by a lot of readers... The Sold price per sqft next to the median sold price. In another post I'll track if for single family homes in Manhattan Beach and later for all the Beach Cities. for the last few years. I've added it to the inventory list in my newsletter for listings found in the Market Conditions Report.

Beach Cities: Sold June 2007 ( click on the information to enlarge graphic)




Beach Cities: Sold June 2006

Beach Cities: Sold May 2007

Beach Cities: Sold April 2007

Beach Cities: Sold March 2007

Beach Cities: Sold February 2007

Beach Cities: Sold January 2007

Beach Cities: Sold ....May 2007

This is what Los Angeles and most of Southern California looked like when I was a kid in the 50's. The streets were wide and most of the homes were either Spanish or Craftsman style with wide lawns in front. My aunt lived in Huntington Park in a bungalow just like these homes along the Avenues in South Redondo.


Spanish Style Bungalows in South Redondo

This week rates shot up with some major economic reports due out later in the week. If the numbers point to inflationary pressures bond prices might drop which would continue to put upward pressure on interest rates.... which would no doubt affect future sales. This is similar to what happened with rates about the same time last year.Overall sales volume and prices are very similar to May 2006 for most cities.

The South Bay/ Beach Cities home market seems to have leveled off. However Manhattan Beach saw a big increase in the number of single family homes that are for sale. Manhattan Beach also saw sales volume drop for single family homes. May saw fewer closings then April or March in most areas. Prices held steady overall. Pendings are fairly strong but I don't expect to see a huge upswing in volume.

Buyers remain picky and will not make offers on homes they deem over market value. We will see some short sales (one on Valley just went pending) and even some foreclosures but don't expect to find these homes priced under current market value. The big winners seem to be townhomes in all the beach cities. As always the only sure thing about our Beach Cities market is that it is always changing!.

May 2007 Beach Cities Sold


Compare with May 2006 sales

Beach Cities: April 2007 Sold
Beach Cities: March 2007 Sold
Beach Cities: February 2007 Sold
Beach Cities: January 2007 Sold

My October Challenge... January Results.. MB Home Sales

On October 27 in a post on Making Housing Decisions from Headline News..
I posed the following challenge:


So here's a thought... In Manhattan Beach there are currently 215 single family homes on the market. 70 have been listed since October 1; 23 have gone into escrow since October 1; and 18 have closed escrow in the same period. So let's say that by next week perhaps another 10 homes are in escrow and 5 new ones have been added so we are 5 down in inventory to 210 as of Nov 1. As we get closer to the holidays about 15% (30) of the homes now available will be taken off the market each month. There will be a few new listings maybe 8 added per month. So... 30-8= 22 x 2 months 44 homes off the market in November and December. Perhaps another 15 a month go into escrow.. that's 30 gone. Not a lot of sales but the inventory level would go from 210 as of Nov 1 to 136 in January. That's about a 35% change in inventory. Would a 35% change and low interest rates bring out buyers? Let's compare notes in January.

Well it's a little past mid January so what happened in Manhattan Beach since November 1, 2006?
There are 103 homes currently listed. 42 are in escrow and 60 have closed escrow since November 1, 2006. 51 homes were withdrawn from the market and have not returned active. Let assume that 30% (16)of those withdrawn return to the market by the end of this month. That would make make a total of 119 available listings which is about 55% of the number that were available October 27,2006.

In two months almost 50% of the inventory in Manhattan Beach has disappeared..... and most of the decline is due to sales not withdrawn/expired properties. Rates were very low from Mid November through the end of December. It looks as if if many people took advantage of sellers who were willing to negotiate and low rates.

I wrote this in the same article in October:
Trying to time a housing market is almost impossible and usually depends on luck more then skill. Often by the time the general public realizes a market has changed it is too late to get in at the right time.

Just something to think about over the next few months for those of you who are still waiting for prices to drop to 2000 levels.

*** These numbers are for single family homes.. but numbers are similar for townhomes.. inventory is very low and a lot of property has closed escrow.