A Mixed Bag of Quick Resales

By Dave Fratello | December 10th, 2019

People buy houses, and things change.

Before they've hung all the family photos, it's time to sell again.

We'll put aside any speculation or discussion on circumstances.

What's interesting is the chance to see same-house sales as a potential barometer on the market.

If people are reselling after a year or two to big markups, the market must be rising, right?

And if not?

One of the most recent examples is 709 Larsson (4br/4ba, 3400 sqft.), a nice 2014 Cape Cod with a pool.

It's also got a really obvious location issue, facing the back of the new Gelson's market. (Hey, at least it's not an auto body shop anymore.)

It sold quickly in July 2017 for $3.100M, and that wasn't just a number. 

The listing actually came out at $2.950M, but it got bid up by $150K to that $3.100M. The home had ignited a little must-have frenzy.

A first attempt to resell came less than a full year later, in May this year. The list price included a markup to $3.299M, then a cut to $3.199M. The market said "no" over 3 months, and the listing quit. 

But in October, it came back at a lower price: $2.999M. 

And it has just closed for $2.895M

So that's $55K less than the first asking price a year ago, and (yikes) $205K less than acquisition. That's -6.6%.

608 15th Street Manhattan Beach CAResults were slightly better at 608 15th (5br/6ba, 5050 sqft.) in the Martyrs area.

The big '07 Mediterranean/Spanish had been purchased for $4.438M in March '17. 

Now it has closed for $4.500M (+1.4%) about 30 months later.

It was a better product on this recent sale. By the end of its long 2016-17 listing period, the home had been vacated and left feeling very tired and out of date. 

The new owners had painted, upgraded here and there and furnished the home with nice style. 

They tried to profit from that work, asking $5.300M to begin. It lingered and lingered, and re-listed at one point. 

With costs of sale, that was not a profitable resale. The market didn't credit them much for the stylistic improvements.

How about a resale within months?

1636 2nd Street Manhattan Beach CA1636 2nd (2br/2ba, 1100 sqft.) is a functional little cottage that now seems to have sold for land value twice in 2019.

In August, it sold for $1.240M

Just now, resold for $1.275M.

Hey, is that a $35K increase in value over 3 months? Wow, at 2.8 percent per 3-month period, this one's on trajectory to be worth $1.4M by next Spring.

And what about the next-door neighbor?

Dave's clients bought 1642 2nd (3br/1ba, 1200 sqft.) in January for $1.155M.

Now, now...

In truth, none of these 2nd St. sales really points to much in the way of trajectory. Yes, we did make a great deal for 1642. The little markup on the resale of 1636 is better than a resale at a lower number, but doesn't say too much about the market. 

If you're looking for tea leaves to read from these sales, you can at least rule out the notion that the market as a whole is rising steeply. 

But if you try to argue that the market is flat or declining based on a few anecdotes, you have to be able to handle the objections to location issues (Larsson, 2nd) and style (15th) that might have made those particular homes a tougher sell.

It would not be right to say the market's down 6.6% since mid-2017 based only on 709 Larsson, for instance. It's just that whatever drove the frenzy then didn't reignite this time.

For now, it's just a mixed bag that happens to not contradict actual data.

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