It's Still Possible to Overprice in a Hot Market

By Dave Fratello | March 8th, 2022

The past year-plus has seen Manhattan Beach home prices rise meteorically, with individual listings often far surpassing professional agents' expectations. Our jaws have dropped more than once. 

But that does not mean that absolutely every house sells "over asking with multiple offers."

As a few recent listings have shown, sellers can still overshoot the rising market and get stuck.

2904 Alma (3br/4ba, 2417 sqft.) is a 2001-built TH that came out in September last year.

It should have found a seam amid the limited inventory of ocean-view homes right then, during the second-busiest time of year for local home sales. (Post-Labor Day.)

But it began at $3.136M, which backed off some buyers.

This was a whole different look & feel from when the same home was on the market in 2019, and eventually sold for $2.375M. That figure seemed "low" at the time for a sizable unit with views both to the south and north.

There were some upgrades made since then, especially in the kitchen, but the property no longer seemed like a screaming deal. Maybe the opposite.

So it got stuck. The sellers moved out and the home was shown vacant. It sat through the holidays, and finally made a deal in early January.

Now it has sold for $2.887M, shedding $249K and 8% from the asking price.

Curiously, the 112 DOM on this sale was oh-so-slightly better than the 113 DOM that the same property registered in 2019.

320 23rd Street Manhattan Beach CA320 23rd (3br/4ba, 1783 sqft.) came out looking pretty, dialed in and ready to go, also in September. 

The 1980s standalone townhouse had been given a complete, head-to-toe remodel and modernization, and its ocean views would bring plenty of people to come and see.

Mostly, though, it seems they came and went.

Unlike 2904 Alma, which stood pat on the asking price until the sellers took less, 320 23rd was managed more aggressively, with 4 price cuts. The last cut came in early January, 2 weeks before they made a deal.

They began at $3.195M, cut down to $2.950M over time, and eventually sold for $2.925M this week.

It's notable, in some way, that both of these townhomes started over $3.1M and wound up close to $2.9M.

We noted those because they closed this week. And because we're tracking a nearby active SFR listing that had a rich launch, 2612 Alma (3br/2ba, 1233 sqft.), which just hit 50+ DOM and finally made a cut, to $2.750M from $2.999M.

We have noted more than once that, at the Edge office, we recently sold the high comp for 2612 Alma, 3420 Alma (3br/3ba, 1761 sqft., same approx size lot at 1667 sqft.). With 9 offers, it was bid up to $2.400M. 2612 is still priced well above that.

Those two recent townhome sales, though, aren't the biggest ask/close gaps of recent months.

404 17th Street Manhattan Beach CAOne that's bigger was 404 17th.

This 3br/3ba, 3149 sqft. custom Cape Cod is on a walkstreet near downtown and positioned just above the baseball fields and basketball courts at Live Oak Park.

They brought this one out in May last year for $4.600M.

It took a while, but they tried some cuts before making a deal in December. It closed in late January for $550K less, $4.050M (-12%). 

219 Anderson Street Manhattan Beach CAIt may be a while before we see a cut as steep as the one associated with a recent Hill Section sale.

219 Anderson (6br/7ba, 6483 sqft.), a 2005 Mediterranean with breathtaking ocean views (seriously, you would stop breathing temporarily). It came out in late September at $10.000M.

That was bold. They liked what they had, they knew what they had, so the sellers went big.

A month later - yes, in late October - they made one cut of $1.050M, down to $8.950M.

But that's not where it was going to settle.

In January, this one closed at $6.500M, or $3.500M below the start price (35%, yep).

It's worth pointing out that this process took "only" 104 DOM, most of those days coming late in the year when market activity is much slower. This was a relatively rapid sale for the price point, and in light of the price correction that the buyer demanded.

So, want to try and overshoot the market with an ambitious start price? Be ready to give it some time, and be flexible when the market says "naaaaah, we were thinking lower."

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