Manhattan Beach homes and townhomes Sold September 2011

Flowers along The Strand in Manhattan Beach



September is the odd month when it comes to closed sales.   September sales reflect figures from the end of July and August.  August is usually the slowest month for sales as folks take the last vacation  of the summer and scramble to outfit everyone for the new school year. 

While total home and townhome sales for September(34) were near those of  2010(37) and higher than the figures for 2007(31), 2008(29) and 2009(26).... the median price was significantly lower than any year since 2003. 

I've been having an interesting online discussion with a reader about what is a distressed property.  While we don't quite agree on the precise definition of  distressed  properties, I think we are in agreement that this is a distressed market in all parts of the South Bay-Beach Cities.  The question is whether or not the Manhattan Beach real estate market will become more distressed or if it will remain  more on the flat side with  little movement. 

Currently  I see  roughly 20%-25%  of the Manhattan Beach properties that are for sale as  distressed which I think is  better  than  the numbers found  in many communities in Southern California.  My reader sees the market as closer to 38% of the available properties as distressed.   But then we have different definitions of what constitutes  a distressed property.  My definition is based on the financial situation of the owner while my Reader believes that  there are other items that make a property distressed. 

It has been over 4 years since the housing market took a major dive and there doesn't seem to be much happening to change the situation.  The boys in DC don't have a clue as they scramble to come up with something... anything.. to make the housing problems go away.  They can't seem to figure out that if you want the housing maket to stabilize you are going to have to make it easier,  not harder  for people to buy.  I'm not talking about reverting to the old programs that got us in this mess.  What I'm talking about is sensible guidelines that work on the consumer's behalf.  These guys are so busy grandstanding  and posturing  they have forgotten the basics.... making a loan to someone with good credit and cash for a downpayment who wants to buy a home.

Manhattan Beach Market Snapshot: Sold September 2011

 

Home Sales for Manhattan Beach, Hermosa Beach, Redondo Beach and El Segundo for June, July and August 2007-2011..

If you are confused about where the housing market seems to be headed... you have lots of company!  Even the experts can't seem to get a handle on what is happening..  In fact  the same story can be seen from different points of view... check out the LA Times  and the Daily Breeze  headline views of August home sales.

The graph above  for home sale volume in Manhattan Beach, Hermosa Beach, Redondo Beach and El Segundo for June, July and August  2007-2011  indicates some very mixed messages.  Manhattan Beach, the most expensive of the Beach Cities,  had more sales in the summer of 2011 than in 2007 as did El Segundo.  South Redondo sales are  fairly stable while Hermosa and North Redondo saw sale volume declines.    

This is a very interesting time in our local real estate market.  Prices are down and in many sub areas are still looking for some sign of stability.  Inventory is down across the board with the exception of Hermosa Beach where inventory rose by 4 properties since mid September. Interest rates are still hovering around 4.2% for a 30 year fixed rate loan.  5 year adjustables are 2.75% for conforming loans ( $625,500 or less).  Jumbo rates are slightly higher at 4.875% with 0 points up to $1,250,000 loan max... significantly below the 7%-8% we thought was amazing  just a few years ago.

For buyers at the entry level  in the Beach Cities the combination of low rates and falling prices mean it may be cheaper to buy than to rent.  I have 2 clients who are closing escrows this month who are paying less on their mortgage  than they were paying in rent.  This isn't true at all price points but definitely at the entry level. 



Beach Cities: Sold June 2011 










Beach 2011Cities: Sold July








Beach Cities: Sold August  2011

Summer home and townhome sales in Manhattan Beach held up well compared to previous years. Overall sales volume for 2011 is the highest since 2007 with 306 homes and townhomes sold between January 1, 2011 and September 15, 2011. Home prices however are another matter.

Manhattan Beach home prices for entry level properties under $1,000,000 have been relatively consistent since last year but prices above that range are still searching for stability. As the recession continues with little sign of abating anytime soon and the stock marketcontinues its wild ride, many financially stable homeowners are begining to feel the pinch of lower economic expectations. For some that means fewer vacations and nights out but for others it may mean they need to sell and either purchase a smaller home or perhaps rent for awhile until the economy begins to look better.

Manhattan Beach real estate prices have definitely declined in the last few years although not by as much as many had predicted. Prices still seem to be in flux for much of the market although not by the percentages seen in previous years. The big question for both buyers and sellers is whether Manhattan Beach real estate prices are approaching the bottom of the market or are there still more price cuts ahead.

Manhattan Beach Market Snapshot: Sold June 2011

Manhattan Beach Market Snapshot: Sold July 2011

Manhattan Beach Market Snapshot: Sold August 2011

Classic South Redondo Beach Home

Real estate sales in all the Beach Cities are down and much slower than last year at this time. Buyers remain unsure about where the economy is headed. The reports that come out of Washington are mixed.. one day the news is great and the next not so hot....



I was reading an article this morning that puts some interesting perspective on the "economic recovery". The article notes that it has been 2 years since the recession ended but not much has changed in the overall economic picture.



While real estate values in the South Bay -Beach Cities have held up better than in other parts of Los Angeles County we have seen values decline. The current market seems to be on the flat side but that could change in October when the conforming loan limits drop from the current $729,250 to $625,000. Home prices have declined but losing $100,000 on conforming loan limits will have an effect on how buyers perceive the market... even if the effect is more perception than reality.




While the difference might not be felt as much in Manhattan Beach or Hermosa Beach, it will affect the Redondo Beach and El Segundo real estate markets as entry level prices are lower. Currently the difference in interest rates for a jumbo vs a conforming rate is not a large amount but qualifying guidelines may well be a factor. If you have a loan over $625,000 that you are planning to refinance now is the time to talk with your lender.





Beach Cities: Sold May 2011

Manhattan Beach Market Snapshot May 2011






May sales figures leave no doubt that the volume of sales is down from last year at this time. While the number of sales isn't off much ... 45 homes and townhome sales in May 2010 vs 37 homes and townhomes sold in May 2011... in our small real estate market 8 sales makes a difference.

Tougher loan guidelines and regulations, consumer concerns about employment and the overall economy are making many buyers skittish about where the market is headed. The boys in D.C. continue to complain about the housing market while they issue guidelines and rules that make it much harder to get a loan than it was in pre 2002.

While buyers in our local Manhattan Beach real estate market generally have the financial qualifications to purchase a home, they are still leery about what is happening in the economy both locally and nationally.



I think most buyers can expect prices on Manhattan Beach homes to remain flat with minor ups and downs in the various subareas. I really don't think we will see any major price declines and certainly no increases for sometime. As long as the economic outlook remains uneven real estate sales will continue to be sluggish even in Manhattan Beach.....








Manhattan Beach : Sold May 2011