Is MB Inventory Often 'Top Heavy'?

By Dave Fratello | May 21st, 2019

We posed a question earlier in the month and wanted to come back to it.

The question was whether the Manhattan Beach real estate market is currently "top heavy," possibly featuring more high-priced listings than demand can absorb. (See "Top Heavy? More Than 1/3rd of MB Listings Are $4M"," May 7.)

At the time, we cut the market into sub-$4M and over-$4M tiers, finding that 36% of active listings were priced in that upper tier.

Wasn't it curious, though, that in 2018, only 15% of sales had closed over $4M?

This was a hint that supply might be out of line with demand in 2019, but we were careful to say that we needed another look at the numbers.

With a new data run, we find something illuminating: Higher-end inventory seems to often swell quite a bit above the observed percentage of sales that eventually close at the higher end.

In other words, maybe it isn't so strange to find a disconnect, where a lot of the active market is higher-priced, even though a smaller percentage of sales by year end will actually fall in that higher-priced tier.

Consider some data. (These charts were produced for a forthcoming MBC report on the Manhattan Beach real estate market, which you'll hear more about soon.)

First, let's look at last year's sales totals for all of Manhattan Beach.

The two green areas show the percentage of 391 sales in Manhattan Beach last year that were priced at $3.5M and above.

It's a total of 21%, and it is the highest share ever recorded in Manhattan Beach.

You can see that the "entry level" of homes, priced up to $1.5M, made up just 15% of sales last year.

In 2012, that "low" price tier saw 55% of sales locally. Big change.

Take a look at how the high end has grown as a share of the local housing market.

In just the past 5 years, sales over $3.5M have doubled to 20-21%.

This market segment has grown while the lower end has shrunk considerably.

We kept the left-edge scale for this chart at 60% for a reason.

That's because we'll now use the same scale to look at inventory.

As of May 15 each year, the share of active inventory priced over $3.5M has always been considerably higher, in the 30s and 40s, and fully 50% as of May 15, 2019.

(These figures all come from our published MB Market Updates from each year.)

Some observations now.

First, it's still remarkable that half of the Manhattan Beach market is priced over $3.5M today. Standing on its own, that's an amazing stat.

Second, as we stated in the lead-up to these charts, it appears to not be very strange to have a disconnect between inventory levels by price tier and closed sales, at the end of the year, by price tier. Looking back, it seems that there's always a lot more for sale at the high end than one might expect.

Third, we'd like to know, as you might: Where the heck do all of these $3.5M+ listings go, if they're not sold?

It's possible this is a mid-Spring phenomenon. That is, sellers are all bringing out their higher-end offerings during prime time, hoping to sell quickly. But the reality is that pricier listings always take longer to sell. This may be an artificial "bump" in inventory at this time of year that works itself out by year-end.

Meantime, lots more homes priced under $3.5M are selling quickly, not sitting around on the market.

There's also a chance that higher-priced listings are disproportionately likely to cancel after failing to sell.

We'll take another look at these data and track some listings in a future report.

Meantime, enjoy a look at the latest $3.5M+ listings in Manhattan Beach. (At the time this post went live, there were 62 active; we can only display 48 within this blog post. Email subscribers will need to view this post online to see the listings.)

Newest Manhattan Beach Home Listings Priced $3.5M+

ADDRESS BD/BA SQFT LOT PRICE $PSF DOM START $ START
Address 3808 The Strand Drive BD/BA 4br/7ba SQFT 4772 sqft LOT 3501 PRICE $13,500,000 $PSF $2,829 DOM 0 DOM START $ $13,500,000 START 04/21/21
Address 117 Crest Drive BD/BA 4br/5ba SQFT 2520 sqft LOT 1666 PRICE $4,950,000 $PSF $1,964 DOM 0 DOM START $ $4,950,000 START 03/30/21
Address 2408 Highland Avenue BD/BA 5br/4ba SQFT 3153 sqft LOT 3495 PRICE $3,995,000 $PSF $1,267 DOM 1 DOM START $ $3,995,000 START 03/24/21
Address 3416 The Strand BD/BA 5br/5ba SQFT 3934 sqft LOT 3494 PRICE $11,500,000 $PSF $2,923 DOM 1 DOM START $ $11,500,000 START 01/28/21
Address 509 Marine Avenue BD/BA 6br/5ba SQFT 4179 sqft LOT 3709 PRICE $4,399,000 $PSF $1,053 DOM 2 DOM START $ $4,399,000 START 04/20/21
Address 1412 Laurel Avenue BD/BA 6br/5ba SQFT 5700 sqft LOT 5432 PRICE $6,999,000 $PSF $1,228 DOM 3 DOM START $ $6,999,000 START 04/19/21
Address 919 1st Street BD/BA 4br/4ba SQFT 2700 sqft LOT 8599 PRICE $8,300,000 $PSF $3,074 DOM 3 DOM START $ $8,300,000 START 03/25/21
Address 508 The Strand BD/BA 5br/6ba SQFT 3963 sqft LOT 3337 PRICE $19,900,000 $PSF $5,021 DOM 3 DOM START $ $19,900,000 START 03/18/21
Address 2305 Bayview Drive BD/BA 3br/4ba SQFT 2570 sqft LOT 3496 PRICE $4,199,000 $PSF $1,634 DOM 6 DOM START $ $4,199,000 START 04/16/21
Address 937 8th Street BD/BA 5br/6ba SQFT 5151 sqft LOT 7200 PRICE $6,999,000 $PSF $1,359 DOM 6 DOM START $ $6,999,000 START 04/09/21
Address 129 38th Street BD/BA 6br/9ba SQFT 3720 sqft LOT 2701 PRICE $4,475,000 $PSF $1,203 DOM 7 DOM START $ $4,475,000 START 02/05/21
Address 121 15th Street BD/BA 3br/4ba SQFT 1900 sqft LOT 0 PRICE $4,500,000 $PSF $2,368 DOM 8 DOM START $ $4,500,000 START 02/24/21
Address 1516 The Strand BD/BA 4br/4ba SQFT 4953 sqft LOT 3330 PRICE $17,900,000 $PSF $3,614 DOM 8 DOM START $ $17,900,000 START 02/16/21
Address 218 1st Place BD/BA 3br/4ba SQFT 2012 sqft LOT 2703 PRICE $3,680,000 $PSF $1,829 DOM 10 DOM START $ $3,680,000 START 04/12/21
Address 2415 Manhattan Avenue BD/BA 3br/5ba SQFT 4275 sqft LOT 2705 PRICE $12,000,000 $PSF $2,807 DOM 13 DOM START $ $12,000,000 START 04/07/21
Address 1137 6th Street BD/BA 5br/6ba SQFT 4665 sqft LOT 7492 PRICE $4,899,000 $PSF $1,050 DOM 17 DOM START $ $4,899,000 START 04/02/21
Address 228 29th Street BD/BA 1br/1ba SQFT 893 sqft LOT 2251 PRICE $3,500,000 $PSF $3,919 DOM 17 DOM START $ $3,500,000 START 03/05/21
Address 516 21st Street BD/BA 4br/4ba SQFT 3540 sqft LOT 3772 PRICE $5,350,000 $PSF $1,511 DOM 19 DOM START $ $5,350,000 START 04/01/21
Address 216 7th Street BD/BA 4br/6ba SQFT 4800 sqft LOT 2702 PRICE $9,650,000 $PSF $2,010 DOM 20 DOM START $ $9,650,000 START 03/25/21
Address 220 13th Street BD/BA 7br/6ba SQFT 3275 sqft LOT 2673 PRICE $4,699,000 $PSF $1,435 DOM 20 DOM START $ $4,875,000 START 01/24/21
Address 549 3rd Street BD/BA 5br/6ba SQFT 4000 sqft LOT 2692 PRICE $4,950,000 $PSF $1,238 DOM 24 DOM START $ $4,950,000 START 03/15/21
Address 220 8th Street BD/BA 4br/4ba SQFT 4195 sqft LOT 2709 PRICE $10,000,000 $PSF $2,384 DOM 27 DOM START $ $10,000,000 START 03/22/21
Address 1023 1st Street BD/BA 2br/1ba SQFT 1325 sqft LOT 7595 PRICE $4,250,000 $PSF $3,208 DOM 28 DOM START $ $4,250,000 START 03/24/21
Address 457 30th Street BD/BA 5br/4ba SQFT 3562 sqft LOT 2703 PRICE $4,670,000 $PSF $1,311 DOM 35 DOM START $ $4,390,000 START 03/17/21
Address 417 34th Street BD/BA 4br/5ba SQFT 4300 sqft LOT 2699 PRICE $3,999,999 $PSF $930 DOM 36 DOM START $ $3,999,999 START 02/12/21
Address 825 Highview Avenue BD/BA 4br/5ba SQFT 4709 sqft LOT 5346 PRICE $9,750,000 $PSF $2,071 DOM 43 DOM START $ $10,195,000 START 03/03/21
Address 3201 Maple Avenue BD/BA 2br/1ba SQFT 1056 sqft LOT 9261 PRICE $3,800,000 $PSF $3,598 DOM 60 DOM START $ $3,800,000 START 02/01/21
Address 3412 Walnut Avenue BD/BA 4br/4ba SQFT 3560 sqft LOT 4588 PRICE $3,999,000 $PSF $1,123 DOM 61 DOM START $ $4,250,000 START 02/19/21
Address 2615 Palm Avenue BD/BA 4br/4ba SQFT 3260 sqft LOT 4643 PRICE $4,395,000 $PSF $1,348 DOM 115 DOM START $ $4,395,000 START 12/04/20
Address 2316 The Strand BD/BA 6br/7ba SQFT 5715 sqft LOT 3503 PRICE $16,500,000 $PSF $2,887 DOM 118 DOM START $ $17,500,000 START 11/25/20
Address 865 3rd Street BD/BA 4br/5ba SQFT 4372 sqft LOT 5700 PRICE $5,599,000 $PSF $1,281 DOM 162 DOM START $ $5,999,000 START 11/10/20
Address 4117 The Strand (aka Ocean Dr) Drive BD/BA 5br/3ba SQFT 2804 sqft LOT 3500 PRICE $5,999,000 $PSF $2,139 DOM 193 DOM START $ $5,999,000 START 09/18/20
Address 421 1st Street BD/BA 4br/5ba SQFT 4081 sqft LOT 2710 PRICE $3,999,999 $PSF $980 DOM 210 DOM START $ $4,500,000 START 09/22/20
Address 224 32nd Street BD/BA 4br/5ba SQFT 4367 sqft LOT 2698 PRICE $6,999,997 $PSF $1,603 DOM 272 DOM START $ $7,499,000 START 07/17/20
Address 592 30th Street BD/BA 5br/7ba SQFT 4648 sqft LOT 4804 PRICE $4,699,000 $PSF $1,011 DOM 280 DOM START $ $4,699,000 START 06/05/20
Address 429 31st Street BD/BA 4br/5ba SQFT 4246 sqft LOT 2705 PRICE $3,699,000 $PSF $871 DOM 298 DOM START $ $3,799,000 START 06/24/20
Address 201 15th Street BD/BA 6br/3ba SQFT 2093 sqft LOT 2701 PRICE $4,289,000 $PSF $2,049 DOM 312 DOM START $ $4,550,000 START 04/22/20
Address 200 15th Street BD/BA 7br/6ba SQFT 3084 sqft LOT 2844 PRICE $4,689,000 $PSF $1,520 DOM 312 DOM START $ $4,950,000 START 04/22/20
Address 2615 Crest Drive BD/BA 3br/5ba SQFT 3216 sqft LOT 1752 PRICE $5,999,999 $PSF $1,866 DOM 332 DOM START $ $6,499,000 START 05/01/20
Address 2016 Ocean Drive BD/BA 5br/6ba SQFT 5739 sqft LOT 2698 PRICE $14,000,000 $PSF $2,439 DOM 562 DOM START $ $14,000,000 START 09/09/19

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