Flippers Still Scoring

By Dave Fratello | September 14th, 2016

"Thar's gold in them thar... sand dunes."

Such has been the sentiment of flippers targeting Manhattan Beach during our years-long rise in real estate values.

Some recent sales show that flippers have continued to find it profitable to make deals on old, dated properties, then turn them back out, refreshed and modernized. Here are some recent sales and new escrows on flipper remodels:

1713 Lynngrove Drive Manhattan Beach CA1713 Lynngrove (3br/2ba, 1500 sqft.) is a Liberty Village cottage that's the latest flip to open escrow.

Redone inside with bright "California Coastal" style, this one is as good an example of currently trending design choices as any: wide-plank oak floors, white marble counters ("Carrera," d'oh!), a seemingly timeless beach-modern color palette of pale blue & teal for walls and accents, some subway tile and wainscotting as bonuses.

This is what you do now. It's what buyers expect and what they react to.

The original cottage was acquired in February this year for $1.268M. (The deal was off-market, so it is hard to compare to some public-market acquisitions.)

The list price on the remodeled version: $1.697M (+$429K). Deal in less than three weeks.

25 Malaga Place Manhattan Beach CAAt the same price point, you could have had 25 Malaga Way (3br/3ba, 2050 sqft.) in Manhattan Village.

This unit was acquired for $1.400M in May, making a very quick, but thorough transition before hitting the market about 10 days ago.

Asking price: $1.699M (+$299K).

With its sought-after first-floor master floorplan (Plan 8), this one was easy to appreciate and found its audience quickly.

1856 9th Street Manhattan Beach CA1856 9th (4br/3ba, 2250 sqft.) has to rank as some kind of surprise, probably more than one. 

Buying a wreck on Aviation Blvd. and trying to flip that and profit at a time like this in the market... gutsy.

But it worked.

Acquisition: $1.116M in February.

A bit later, with its open floorplan, luxe master, stainless appliances, wide-plank floors and "Carrera" (d'oh!) marble counters, this one was ready for market.

Sold price: $1.650M (+$534K). On Aviation.

1416 11th Street Manhattan Beach CANot with the same sort of location challenge, there was 1416 11th (5br/4ba, 2800 sqft.).

Purchased in May 2015 for $1.650M, this home needed everything – and got it.

Perhaps you'd call it undersized for the 7500 sqft. lot, and perhaps the "opened" floorplan had a couple of head-scratchers to it, but there was no denying the appeal of the style, central location and big yard.

There was no denying the buyer, who grabbed it absolutely instantly.

Asking price: $2.399M. Sold price: $2.500M.

That's a tidy $850K over acquisition.

Not all the flips are east of the Highway. 

200 Moonstone Manhattan Beach CAThere's an eye-opener at 200 Moonstone.

This 2-story El Porto duplex, built in the late 1950s, was acquired in a public-market sale in May this year at $1.600M.

Full price for a Porto duplex these days, right?

Not if it were to get a treatment.

Post-remodel, 200 Moonstone resold in late August for $1.830M (+$230K).

3100 Palm Avenue Manhattan Beach CAIn the Tree Section, we just saw 3100 Palm (4br/5ba, 3350 sqft.) find a buyer.

This 1980s corner-lot house with no real yard struggled a tad on the market last year, but sold for $2.325M in September 2015.

It needed everything (see the old listing), and got it.

The totally revamped version ("Extreme Customization") needed only 3 weeks to find a buyer and make a deal at $2.999M (+$674K). It's pending now.

660 Rosecrans Avenue Manhattan Beach CAOr take a look at 660 Rosecrans (2br/3ba, 1800 sqft.).

Not sure whether to call this a "flipper" remodel because it was no quickie, but this home was utterly transformed in 2015 after a 2014 acquisition, and listed for sale early this year.

The original 1950s version was smaller by 500 sqft. and creaking, dated and difficult. (See the old listing here, where the agents struggled to find upbeat language and wound up touting the benefits of both front and rear driveways.) It did sell after ~50 DOM for $1.062M in March 2014.

Asking $1.599M this year, the redone version had to find 2 buyers but did get it done at $1.600M (+$538K).

That's 2 bedrooms. On Rosecrans. For $1.6M.

There are a couple of new flips on the market worth watching in East MB:

113 S Aviation Manhattan Beach CAThere's 113 S. Aviation (4br/4ba, 2250 sqft.), purchased in Nov. 2015 for $980K, and now up asking $1.599M (+$621K).

Maybe they're looking to repeat the feat accomplished by 1856 9th just a couple of months ago... $1.650M for a comparably sized house (although 9th St. had a larger lot).

A large number of buyers will simply never look at it because of that Aviation address, and no one will be persuaded by the description's claim that it is situated in a "great Manhattan Beach neighborhood," but the work is impressive and, once you get into the home, it's possible to enjoy it on its own merits.

1750 1st Street Manhattan Beach CA

1750 1st (5br/3ba, 3125 sqft.) is close to, but not on, Aviation. The 1980s house sold for a sizable retail sum, $1.750M this past March, before undergoing renovation.

They're looking for $2.449M now for the redone version (+$699K).

Overall, we've called the style of the remodel here "fully contemporary" – borrowing from the mainstream "California Coastal" style that was so well-done in the first listing we referenced in this post, 1713 Lynngrove. Can they pull it off here?

Some of the late entrants this year do raise an interesting question: Is there still gold in these dunes? For how long?

As the market shows curious signs – flattening? still rising? threatening? – it becomes tougher for investors to get excited about flips, unless they can really steal the original property.

We'll revisit this theme in Spring and Summer next year, to see how the flipping community has fared, and how they've bet, in Manhattan Beach in a time of possible market transition.

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