The majority of the South Bay is officially on spring break!
And with the onset of the long week off, we also get the conclusion of 2024’s first quarter.
Without question, the real estate market has not gone the way many had planned i 2024. Inventory remains excruciatingly tight, mortgage interest rates have climbed higher the first three months, and prices have held firm, if not gone higher.
I think the numbers to start the year will surprise many, so let’s dive in!
Manhattan Beach
Manhattan Beach is coming back to earth after reaching sky-high record prices in 2022. Just 18 months ago, Manhattan Beach saw its median price above $3.5 million. That is no longer.
- Manhattan Beach Q1 Median Price: DOWN 10.5%
o Q1 of 2024: $2,505,000
o Q1 of 2023: $2,800,000
As you can see, Manhattan Beach is continuing its downward trend with quarterly year-over-year numbers slipping just over 10%.
- Manhattan Beach Q1 Closed Sales: UP 50.0%
o Q1 of 2024: 60 sales
o Q1 of 2023: 40 sales
While sales have been hitting all-time lows throughout the South Bay, it is a breath of fresh air to see sales 50% higher compared to Q1 last year.
All in all, Manhattan Beach prices are falling but it is far from panic. It is a healthy correction for a market that went parabolic in 2022 during low interest rates and insane residential real estate demand.
Sales are up strongly, which is a positive and multiple offers are still occurring for well-priced homes. And while the ultra-high-end sales are slowing, the activity is healthy and new construction homes are still selling for top dollar.
Palos Verdes Peninsula
The Hill’s largest two markets, Palos Verdes Estates and Rancho Palos Verdes, had a weak 2023 but look to have reversed course ever so slightly to kick off 2024.
- Palos Verdes Estates Q1 Median Price: UP 1.0%
o Q1 of 2024: $2,712,500
o Q1 of 2023: $2,686,086 - Rancho Palos Verdes Q1 Median Price: UP 5.0%
o Q1 of 2024: $1,637,500
o Q1 of 2023: $1,560,000 - Rolling Hills Estates Q1 Median Price: UP 32.2%
o Q1 of 2024: $1,687,500
o Q1 of 2023: $1,276,000
Palos Verdes Estates pulled back to a median price of around $2.5 million in 2023 but is up nicely to $2.7 million in Q1. It is a small increase of 1% year-over-year, but a major improvement compared to a tough 2023.
Rancho Palos Verdes also turned for the better with a jump of 5% in median price.
While already strong last year with a 3.1% gain in 2023, Rolling Hills Estates is trending higher like a rocket ship. Up over 30% year-over-year compared to the last 1st quarter is an incredible sign of strength. The data is small but a great signal, nonetheless.
- Palos Verdes Estates Q1 Closed Sales: UP 53.8%
o Q1 of 2024: 40 sales
o Q1 of 2023: 26 sales - Rancho Palos Verdes Q1 Closed Sales: DOWN 17.5%
o Q1 of 2024: 66 sales
o Q1 of 2023: 80 sales - Rolling Hills Estates Q1 Closed Sales: UP 25.0%
o Q1 of 2024: 20 sales
o Q1 of 2023: 16 sales
Like Manhattan Beach, Palos Verdes Estates saw its sales climb by over 50%, another positive result on the transaction side of the business. Rolling Hills Estates saw solid sales growth as well, but Rancho Palos Verdes failed to grow sales and seems to be one of the few outliers when it comes to lower sales year-over-year.
Please note, I did not cover Behind the Gates in Rolling Hills this quarter due to the small sample size. That said, I will aggregate six months of data next quarter so you can see how the South Bay’s most expensive city performed.
Hermosa Beach
Hermosa Beach was down by just over 1% in 2023, however, it may be reversing the trend if early 2024 numbers are an indicator.
- Hermosa Beach Q1 Median Price: UP 4.6%
o Q1 of 2024: $2,055,000
o Q1 of 2023: $1,965,500
The just under 5% growth is a fabulous move for the small, but mighty city that almost always delivers positive numbers in a smooth, consistent manner.
With regards to sales, again, the early 2024 results are excellent.
- Hermosa Beach Q1 Closed Sales: UP 45.5%
o Q1 of 2024: 32 sales
o Q1 of 2023: 22 sales
The sales jump of 45% and nice median price growth are all encouraging results for the real estate market in Hermosa Beach.
Redondo Beach
Please note, these calculations also include Hollywood’s Riviera’s Redondo PO which is technically Torrance.
The South Bay’s most affordable beach city saw its price surge higher in Q1. It is a surprising and fabulous result for local homeowners.
- Redondo Beach Q1 Median Price: UP 24.7%
o Q1 of 2024: $1,590,000
o Q1 of 2023: $1,275,000
The entirety of 2023, Redondo saw its median price fall by about 3%. So, to see prices jump by 25% compared to last Q1 is an exceptional result for the city’s residential marketplace.
- Redondo Beach Q1 Closed Sales: DOWN 3.1%
o Q1 of 2024: 94 sales
o Q1 of 2023: 97 sales
The one blemish to a massive jump in prices is that completed sales slowed. No one is perfect but not much to cry about when it is lower by just three whole transactions, in an almost 100 transaction quarter.
Final Thoughts
Thank goodness for Q1 data to allow us number nerds to see the action in the South Bay home market.
The statistics help to clear out the noise and opinions, and lets the cold hard math tell the market story for us.
In all, the results look to be fair positive:
- Median prices are up across the board with the exception of a healthy correction in Manhattan Beach.
- Sales are up solidly in most cities.
Despite high interest rates, the results are probably surprising. And while I did not cover inventory, we know that is a challenge for the market but likely helping to buoy prices.
See you next week and excited to bring you Q2 results in three months. Happy Spring Break!
Richard Haynes
DRE: 01779425
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The Richard Haynes Real Estate ShowA leader in South Bay real estate for the better part of a decade, Richard thrives as an advisor to his clients with over $248 million in sales as a broker or investment principal at his boutique agency, Haynes. Richard is known for his keen local market insights which have been featured in the L.A. Times, The Street, and Forbes, along with his weekly South Bay real estate blog. [read more]