As the South Bay home market begins to wake from its holiday slumber, I went back to study this normally slow season. From my research, I found an unusually high amount of sales in the luxury home market. In only 42 days, from December 1st to January 11th, the luxury home market had some MAJOR sales!
Hermosa Beach
Lot Sale
- 1918 The Strand
- Asking Price: $7,200,000
- 2,547 sq. ft., 2,382 sq. ft. lot
- Sold for $6,800,000
Some might believe this sale will be the benchmark for land value on The Strand in 2019. With its bullseye location in the middle of Hermosa, many buyers will believe that similar lots to the less desirable south will sell for less, and similar lots to the more desirable north will sell for more.
All in all, there is still a lot of “land” inventory, so sellers will face pressure from buyers looking to purchase for a price lower than this sale regardless of location.
Spec Home Sale
- 1932 The Strand
- Asking Price: $13,200,000
- 3,826 sq. ft., 2,400 sq. ft. lot
- Sold for $10,500,000
This home is another bullseye location in the middle of Hermosa and its sale will set the value for brand new homes on the Hermosa Strand in 2019. Most buyers will look to this comp to price new construction and existing property.
Manhattan Beach
Existing Re-Sale Finally Closes
- 108 The Strand
- Asking Price: $19,995,000
- 6,910 sq. ft., 3,333 sq. ft. lot
- Sold for $15,250,000 (24% price cut over three years)
Originally, priced for a record sale at $19,995,000, this listing unfortunately just missed the top of the hot market and cut 24% over three years to finally make a deal.
This sale will be a benchmark for newer existing homes on south end of the Manhattan Beach Pier. In fact, it likely influenced the newest 2019 lot sale south of the pier…
Lot Sale
- 816 The Strand
- Asking Price: $12,850,000
- 2,807 sq. ft., 3,366 sq. ft. lot
- Sold for $11,775,000
Without a doubt, the buyer here was looking at the 108 The Strand sale and calculating if they could buy and build a brand-new home for a total amount between $15 million and $16 million to match the $15.25 million sale.
Both of these Manhattan Strand properties are benchmark sales that will help shape land value and brand-new construction for 2019 south of the Manhattan Beach pier.
Palos Verdes Estates
- 2701 Via Elevado
- Asking Price: $26,680,000
- 8,847 sq. ft., 146,236 sq. ft. lot
- Sold for $14,100,000 (almost two years on the market with a 47% price cut)
This home became the second highest sale ever in Palos Verdes Estates to clear on the MLS. This massive 3.3 acre estate is one of the largest single-family home properties in the entire South Bay. Its stunning Queen’s Necklace views really are a show stopper, making a rare combination of space, privacy, and ocean/city landscape sights.
The P.V. Hill has had a theme of non-distressed property auctions starting with the $22,400,000 sale of 1 Buggy Whip Drive in Rolling Hills (see my November blog post: $30 Million Cut on Rolling Hills Auction), as well as the coming auction of 41 Marguerite Drive in Rancho Palos Verdes asking $15,450,000. It will likely sell for far less.
The fresh 2701 Via Elevado sale was essentially an unofficial auction. While not a true auction, this was basically an MLS auction that the sellers knew they had to cut quickly to find a buyer that the market would bear.
Rolling Hills Estates
The Residences of the Rolling Hills Country Club are really changing the landscape of Rolling Hills Estates real estate.
Rolling Hills Estates has always had a high median sales price relative to most of the South Bay, however, the city always lacked big time sales prices since its boundaries did not have homes on the P.V. Bluffs, nor property with truly commanding views.
The Residences are changing that, being an ultra-high-end new construction development.
- 39 Chandler Ranch Road
- Asking Price: $4,150,000
- 5,203 sq. ft., 12,957 sq. ft. lot
- Sold for $4,649,827
This home was the third highest sale, ever, in Rolling Hills Estates, only behind a massive 8,800 sq. ft. home on a 200,000 plus sq. ft. lot and another sale in The Residences earlier this year.
What stands out to me is the $902 per square foot paid for the home. To give some perspective, in 2018, there were 83 sales on the Palos Verdes Peninsula over 4,000 square feet. The median price per square foot paid on those sales was just $625.
That price per square foot premium is exceptional. Can they keep up that price pace for all 114 sales of the new development? Only time will tell.
Other Notable Activity
- 233 South Meadows, Manhattan Beach
- Asking Price: $8,399,000
- Sold for $5,600,000 (a 33% cut with almost two years on the market)
- 915 Via Panorama, Palos Verdes Estates
- Asking Price: $7,300,000
- Sold for $4,800,000 (a 34% price cut at closing)
- 513 Longfellow Avenue, Manhattan Beach
- Asking Price: $5,349,000
- Sold for $4,275,000 (new construction and a 20% price cut after 10 months on the market)
- 980 Via Rincon, Palos Verdes Estates
- Asking Price: $4,995,000
- Sold for $3,900,000 (three years on the market with likely a 0% ROI for the developer after a five year investment)
Conclusion
It is hard to believe that all these big sales took place during the traditionally slow holiday season.
Deals are being made in the luxury home market, but they are a far cry from the days of quick sales well over asking.
It looks like sellers are beginning to realize some prices can simply
be too high and that buyers now have the leverage and patience to wait out fair prices.