In North Hermosa Beach, it is very tricky to generalize market value.
There are a variation of lot sizes, town homes, property views, and income properties, which makes it difficult to give a perfect breakdown of this sub-market. That said, the majority of single-family home sales in this area sit on a 2,500 sq. ft. lot, so for today’s blog, I will focus on these properties to give you a general guide on the area’s value.
Newer Construction with Views
As many readers have learned over the years, new construction drives the market by the beach. Since the blow-out sale of $5.25 million at 230 34th Street back in 2016, the market has delivered three additional new/newer construction sales over $5 million:
- 2545 Myrtle Avenue (4,188 sq. ft., 2,665 lot, 2014 build) sold for $5.275 million in Sept of 2017
- 123 28th Street (3,861 sq. ft., 2,477 lot, 2012 build) sold for $5.1 million in Sept 2017
- 120 28th Street (3,924 sq. ft., 2,490 lot, 2013 build) sold for $5.35 million in June of 2018
These homes clearly demonstrate that North Hermosa Beach new/newer construction sales with views in the low $5 millions are here to stay. The price per square foot (PPSF) of $1,259, $1,320, and $1,363, respectively, are big time numbers for very sizable homes. These homes would generally cost about $2 million to build, so let’s look at the lower priced sales that are close to “lot sales.”
“Lot Sales” with View Potential
Taking what we know with the above sales and a $2 million building budget, let’s look at the sales below to get some insight on buyers on the other end of the spectrum.
- 221 28th Street (1,884 sq. ft., 2,399 lot, single-family) sold for $2,425,000 in May 2018
- 123 34th Street (2,380 sq. ft., 2,554 lot, duplex) sold for $2.7 million in February 2018
- 3205 Highland Avenue (1,809 sq. ft., 3,300 lot, duplex) sold for $2.935 million in July 2018
As you can see, the 221 28th Street sale is the lowest sale and for good reason. This home is not only smaller in livable sq. ft. and lot sq. ft. than most, but it is also not in the coveted 100-block. As a result, the property sells at a major discount to its peers.
The 123 34th Street sale is the perfect tear-down duplex comparable to the new construction homes. At a $2.7 million sales price, and $2 million in building costs, this owner will be all-in for under $5 million. And, they will likely create a few hundred thousand dollars of equity for their troubles.
Lastly, 3205 Highland Ave shows the true value of what an over-sized lot will yield from a value perspective. With a 3,300 sq. ft. corner lot, that extra 800 sq. ft. allows for much more creativity for a home, not to mention the towering views from Highland. Even though this location is on the corner of busy Longfellow and Highland, the extra lot size was the deciding factor for a buyer who does not mind spending well into the $5 million range. Likely, the buyers believe they will get that money back no problem regardless of the busy location…and it is hard to argue against them.
Newer Construction with Lesser Views
There is only one recent newer construction sale as you head farther east to the 300 and 400-blocks.
- 300 28th Street (3,455 sq. ft., 2,400 lot, 2002 build) sold for $4.199 million in June 2018
As you head farther east, and the views get suppressed, the pricing is discounted, and Sellers tend to not risk building bigger homes.
“Lot Sales” with Lesser Views
You can see the discount for “lot sales” due to the comparable above at 300 28th Street.
- 337 26th Street (1,568 sq. ft., 2,486 lot, single-family) sold for $1.995 million in June 2018
- 306 29th Street (1,508 sq. ft., 2,407 lot, single-family) sold for $2.31 million in Sept 2017
- 330 28th Street (1,832 sq. ft., 2,401 lot, single-family) sold for $2.599 million in April 2018
Clearly, these lot sales are discounted to the premium locations that will yield better views mentioned earlier in this post.
The 330 28th Street got a nice premium due to its turnkey condition and optimal spring season listing time, which skewed the sale higher and away from “lot sale” numbers.
Conclusion
From the above information, you can see that single-family homes in the 100/200-block with great views can garner between $2,425,000 and $5,350,000, while the lesser view properties on the 300/400-block can range between $1,995,000 and $4,199,000. This information can be used as a general guideline for properties on these streets and lots.
Keep in mind, there are plenty of other locations, home types, and lot sizes in North Hermosa Beach, streets like Bayview Avenue, Hermosa Avenue, The Strand, and a multitude of town homes, that will fetch varying values. You can use the above post as a baseline for different locations and lots but be sure to do your homework to attach the proper discount or premium needed when negotiating your price in this area!