Maybe 43% Off Was a Steal

By Dave Fratello | December 26th, 2019

A very quick flip now suggests that a recent deal was a real steal.

3201 Alma Avenue Manhattan Beach CAYes, we're already back to talking about 3201 Alma, a 2/3rds-sized corner lot on a walkstreet in the North End.

It was only about 6 weeks ago that this lot-value property closed for $2.225M, a far cry from the $3.900M start price. (See "Sometimes You're Off by 43%.")

But that is not the end of the story.

Now it's been resold for $2.300M in a quick off-market trade, one involving neither of the original agents.

This adds slightly to the mystery of what the property was worth. (Aren't real estate values always something of a mystery?)

A wounded-duck listing like the first one on this property will tend to sell too low.

Start too high, sell too low.

Now it's clear there was one other buyer out there willing to go higher, by $75K to be exact.

Oops.

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P.S. We want to acknowledge an alert reader's mathematical comment on our prior post.

We noted that 3201 Alma sold for 43% less than its list price. However, we also stated in the post: "They overpriced by 43%."

The reader notes that while the home did indeed sell for 43% less than the start, it was actually "overpriced" by 75%. That's because the $1.675M discount should be divided by the actual final price ($2.225M) to solve for the degree of overpricing, or 75% in this case.

So, 75% overpriced, plus $75K undersold in the end, it would appear.

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