Amid Record-Low Closings, Median Price Jumps to $2.5M

By Dave Fratello | May 6th, 2020

For the second month in a row, the median price for Manhattan Beach has not only increased, but has marked out a new peak.

This time, it's $2,499,500, up from $2,410,000 last month.

We did mention this new median price peak in our market update and video the other day, but it's worth a some focused attention here, too. This uptick comes amid some other notable data.

If a record-high median price seems incongruous or unexpected here in the midst of the COVID-19 situation, that means you're paying attention.

You know from our recent reporting that the pace of new escrows is at a crawl.

Closed sales are a lagging indicator, because it takes a few to several weeks to close a sale. And yet, we're already seeing in the data that closings are very slow compared to other Aprils.

Our new chart here looks at sales data compiled at the end of April for each of the past 13 years.

Our current moment doesn't stack up too well.

The 23 closings within April 2020 were the lowest on record for this period, even 6 sales below April 2009, which was, er, a very challenging time in its own right.

With 69 sales in the 3 months ending April 30, we also saw a total lower than every one of the prior 12 years.

And the 12-month sales pace is impacted now, too.

With 352 closings in the year between May 1, 2019 and April 30, 2020, we had the second-lowest total over these years. This time, April 2009 still holds the record (such as it is) for an anemic 1-year sales pace at just 313, reflecting all the difficulties of 2008 and early 2009.

At this time in each of the 3 prior years (2017-19), sales totals were in the low 400s (407-411), a remarkably consistent range. This year, we're off that pace by 14%. The numbers are looking a bit more like they did in sluggish early 2016, a time when many sensed the market was shifting... until it didn't.

As we've said, none of these trends are permanent, and they're easily understood in the context of a pandemic that has chilled real estate market activity. Whenever it can be said that the market is more "normal," we may see pent-up demand deliver higher-than-average sales in later months.

A last thought here on the median price and its relation to the lower sales totals.

We have pointed out that of the 23 homes that closed in April, there were 16 sales above the new median price. In other words, the closings are skewed toward higher-priced properties. That moves up the median.

Many homes have fallen out of escrow since the pandemic hit, slamming the financial markets and upsetting real estate. However, when we look at the data, there's nothing to show that those falling out were mostly lower-priced properties. (Here's a link through our MB Property Ticker to see only the out-of-escrow properties.) 

This observation suggests that the median price was going to rise in April almost regardless of COVID impacts.

All of the homes that did close in April are listed below. (Email subscribers will need to view this post in a browser to see the properties.)

Closed Sales in April 2020

 

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