The South Bay home market has been nothing less than incredible since early 2020. Some might even consider it volatile from a sales collapse during the early days of Covid-19 to the insane run up thanks to low interest rates, and now to uncertainty around the market with sky-high rates and bank failures.
It can be debated on how one would classify the South Bay market as a whole, but when it comes to property on The Strand, it is always a wild ride.
Manhattan and Hermosa Beach’s Strand almost always sees property value swings thanks to just a few buyers driving the market at any one time.
There are very small windows to “steal” a property and equally as small windows to sell a property for “top dollar.”
Buyers and Sellers on The Strand have the cash to make quick deals at deep discounts, as well as plenty of wealth to wait for years and years for the right buyer. This creates swings on The Strand that are much more volatile than just about any other home pocket in the South Bay.
Below are a few blogs to help you understand the volatility within this specific pocket of luxury beach living:
April 2021: Hermosa Beach Strand Prices Making a Comeback
October 2018: Manhattan Beach Strand Home Values Set to Decline
Those are some up and down headlines, and I can tell you, it looks similarly up and down in even older blog posts.
Current Strand Happenings
If I am going to touch on The Strand marketplace now, it would be fair to classify as a slower market.
Obviously, the height of the real estate market frenzy was the end of 2021 into early 2022. The time to rip that record high price on The Strand was likely middle to late 2021.
Now that we have shifted to high interest rates, a falling stock market, and uncertainty around a recession due to hawkish Federal Reserve policies, The Strand is a home market where it is tough to get deals done.
Today there are more Strand listings on the market than sales completed in the last 12 months. What’s more, there are zero properties in escrow. It is at a little bit of a standstill as buyers and sellers try to find what is fair value in a shifting market and economy.
And finally, I am not including the properties that have expired or canceled while listing. The Strand is a waiting game 90% of the time and closed transactions are almost always lower than active inventory.
I won’t get into the comps of 2021 and early 2022 in this post but perhaps later in the year.
What Consumers Think of Strand Prices
For many, The Strand is luxury real estate that everyone loves to explore in real estate magazines and on the various online websites.
It is fun to look and imagine owning a slice of South Bay beach heaven. Most of the day-dreaming is fixated on the highest-priced properties like current listings on the market today.
- 6-beds, 8-baths, 4,399 sq. ft.
- Asking price: $10.5 million
This is like new Hermosa contemporary has received custom upgrades since its spec sale in 2020. It has been shopping for a buyer since February of 2022 but holding firm on the asking price.
- 4-beds, 6-baths, 4,517 sq. ft.
- Asking price: $18.25 million
A gorgeous 2008-build just north of the famous Manhattan beach Pier and walkable to a plethora of high-dining establishments. This came to market in October 2022 and is waiting patiently for the right buyer.
I highlight these two properties because again, this is what we think of when it comes to Strand property. While gorgeous, there are much more affordable options that not everyone is aware of outside of Realtors that watch and study daily.
Let’s look at a few sales and a current for sale option under $5 million.
Property for Under $5 Million
For those that do not know, there are townhome and condo options on The Strand.
Not all are created equal, but it allows for a low-entry price into a premier market that some buyers will pay three or four times as much for a large home.
- 3-beds, 3-baths, 2,138 sq. ft.
- Asking price: $4.895 million
This El Porto condo is an excellent example of a property below $5 million with a penthouse. It is currently on the market and has already reduced its price by $300,000.
- 3-beds, 2-baths, 1,408 sq. ft.
- Sold: $3.95 million
If you want even more affordable Strand options look to South Hermosa condos or townhomes. This Hermosa was purchased for under $4 million and sold at a time when the market was hotter…could another one go for lower in this environment?
- 2-beds, 2-baths, 1,190 sq. ft.
- Sold: $4.85 million
This downtown condo is a turnkey option around some homes that go for over $20 million. If you are looking for a pier-a-terre to frequent restaurants and enjoy ocean/pier views, this is the play over an expensive home.
- 3-beds, 3-baths, 1,552 sq. ft.
- Sold: $4.7 million
And finally, one more example in MB not as close to downtown but the small location sacrifice offers a larger unit and extra bedroom compared to the previous 2-bed option.
It is rare for a price point of $4 to $5 million to work for a prospective buyer, but if you have dreamed of owning a slice of the South Bay’s Strand, you do not have to have $15 to $20 million.
There are homeowners in the Tree Section, the Avenues, Montemalaga, and beyond that live in large $4+ million homes that may get little use. If you’re looking to downsize and increase walkability to restaurants and the beach, well, this can be an option.
And of course, those who love their large estates in Rolling Hills or the Hill Section, then this a second home option at a huge discount to stand-alone homes that come with similar benefits.
There is still hope for more homes – hang in there!