Beach Cities Real Estate Market Update August 2020

Better Than A “V” Shaped Recovery

July was the best month for Beach Cities home sales in 2020 and as we work through August we are seeing multiple offers on many properties, price acceleration, record low mortgage interest rates, and a continued Seller’s Market.

Here’s a recap of sales through the first seven months of 2020. July crushed every other month. And with the number of properties currently in escrow, I am expecting a very strong August as well.

Beach Cities Sales Jan-July 2020

How does this compare to prior years?

Jan-July Sales 2016-2020

A few thoughts.

While some of this is related to the Coronavirus and economic downturn, there’s also an element of there’s just lower inventory. The lower inventory plus the record low mortgage rates are driving up prices.

I’m not anticipating any major changes in the inventory levels anytime soon so you can expect the Seller’s market to continue.

As of this posting here’s the comparison of in escrow properties to active listings:

• Redondo Beach 122 active listings / 137 in escrow

• Hermosa Beach 56 active listings / 31 in escrow

• Manhattan Beach 132 active listings / 82 in escrow

So we’re seeing anywhere from less than one month of inventory in Redondo Beach to slightly over 2 months in Hermosa Beach with Manhattan Beach being somewhere in between. Anything less than 3 months of inventory is considered a Seller’s Market.

Let’s take a deeper dive into each city.

MANHATTAN BEACH

• 47 Sales

• $925,000 to $7,500,000

• Median Price $2,250,000

• Average Price $2,511,862

• Median Days on Market 22

• Average Days on Market 40

Manhattan Beach July 2020 Sales by MLS Area

HERMOSA BEACH

• 28 Sales

• $655,000 to $8,200,000

• Median Price $2,112,500

• Average Price $2,378,571

• Median Days on Market 33

• Average Days on Market 54

Hermosa Beach July 2020 Sales by MLS Area

REDONDO BEACH

• 94 Sales

• $375,000 to $3,450,000

• Median Price $1,150,000

• Average Price $1,297,914

• Median Days on Market 10

• Average Days on Market 30

Redondo Beach July 2020 Sales by MLS Area

A FEW THOUGHTS

I am very pleasantly surprised to see how strong the Real Estate market has been since about Memorial Day. I have mentioned on more than one occasion that I have been as busy the last 6-8 weeks as I have ever been. (And I hope that continues.)

Here’s what seems to be going on.

For many people fortunate enough to still be working, they may be doing so in the future from their homes either fully or partially. This really changes their requirements as to where they may want to live. In other words, going forward it just won’t be a requirement for some people to be close to work anymore. I’m seeing this both with people currently renting as well as home owners who may become sellers.

So there’s a lot of buyer demand and low inventory.

And with record low mortgage rates and huge demand prices are increasing their upward climb. Expect that to continue as long as mortgage rates stay low. If they go up a half a point or more expect to see a leveling off or decline in prices.

Locally the demand for homes west of PCH (Sepulveda Rt 1) and especially in the Sand Section, either Manhattan or Hermosa, just really jumps out to me. While these properties are more expensive than those further east, they seem to dominate the volume.

I’ve lived in both the Manhattan Beach and Hermosa Beach Sand Section over the years and I can tell you that there is more similarity in either Sand Section than let’s say compared to Manhattan Village which is a totally different community.

It should be noted that Hermosa Beach has been performing really well both in terms of consistently of sales and price. Also note that the median price is not that much lower than Manhattan Beach and that Hermosa had a higher top sale than Manhattan in July but let’s consider that an anomaly at least for now. As for the prices, at this point what I am seeing is similar to what I saw as the gap between North and South Redondo narrowed.

Speaking of Redondo Beach, it is an extreme Seller’s Market as you can see by the median days on market. My last Redondo Beach listing was in escrow in 7 days and sold at a new high for a similar property (which I expect to be eclipsed soon).

Thanks for visiting. Stay healthy. Wear your mask. Vote (in person or by mail).

Namaste LA