Local Luxury Markets Down, TooPosted on Thursday, May 14th, 2009 at 12:53am.
You may recall that Redondo, with similar sales volume, dropped at about the same pace from 2002-2008, and MB, Redondo and Hermosa all hit new lows for sales in 2008. (See "Beach Sales: South Since '02-'03.")
Now we see that the same disease hit almost every local luxury market at about the same time.
Our newest chart looks at sales of SFRs in several local higher-priced markets, from Rancho Palos Verdes in the south to Pacific Palisades to the north. (Click to enlarge.)
The sales paces in these 6 separate markets moved in remarkably similar patterns throughout the past 20 years.
Nose-dives in the late 1980s, mid-90s and 2001 were nearly simultaneous and at about the same scale in each market.
After a giddy 2002, the sales pace declined steadily and sharply in 5 of these 6 markets, with only Santa Monica's 90402 market (the smallest subset, red at bottom) looking relatively orderly as its sales pace fell almost 50%.
Every one of these 6 markets scraped out a new bottom for sales in 2008; most had created new bottoms in 2007 first.
So MB is not alone – again.
It's some kind of encouragement to know that, even as the economy boomed throughout the mid-2000s and people felt (and got) richer than ever, fewer and fewer homes traded hands in all of these markets – some of the most desirable housing markets in the L.A. area. It wasn't just an MB problem.
We'll get ready to look at median prices for these markets soon. But it's no secret that medians rose considerably across the board during much of the period while sales were slowing. There may be some relationship between those factors. As prices begin to fall notably in the higher-priced markets, the seeds of recovery – in sales pace, anyway – may soon be planted.
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