MB Market Update for 4/15/20

By Dave Fratello | April 17th, 2020

Maybe, like us, you were bracing for this news about the pace of the local real estate market.

It turns out, things got even slower in the first half of April.

As of day's end on April 15, there were only 8 new escrows in place that weren't in motion by the first of the month.

The average for the same period over 7 prior years: 21 new escrows between April 1-15.

This follows a second half of March that saw just 10 new escrows. (See that report here.)

We're supposed to be in our busy season. Obviously, that's on hold.

This low level of April sales activity, combined with a comparably slow second half of March, has made these last 4-6 weeks the slowest of any over the past 8 years. (See our chart.)

The dip to 40 new escrows over 6 weeks is more than 10 below every year's total except 2016's anemic 42 new escrows. We're down 39% from last year, and running at less than half the pace of 2017.

1801 6th Street Manhattan Beach CAWe've already observed something interesting and probably instructive about the new deals that have been made in early April: 6 of the 8 were properties that had already fallen out of escrow at least once, recently.

Notably, 4 of the new deals were on either flipper remodels (2) or new construction (2). (New construx at 1801 6th is pictured.) That's a way of noting that investors have been somewhat more successful, or motivated, to make deals to sell their offerings.

Nerdy note: These data come from our hand-crafted, MLS-based, twice-monthly market updates published here at MB Confidential, and includes listings that go from active status to pending or "active under contract," in both cases reflecting an accepted offer. We have not made any effort to delete failed escrows from the data for any year. We measure what's new in any given 2-week span.

Early Friday, the National Association of Realtors published a "flash survey" of almost 2300 member realtors. (Click to download.)

Here are a couple of the most interesting findings from realtors reporting on their clients' attitudes today.

Off the bat, it's easy to see that 60% of buyers have chosen to delay their process for "a couple of months."

Equally small numbers have chosen to continue apace and to put off buying "indefinitely" (12% in each case).

From the sellers' side, the proportions are extremely similar, with 57% delaying "a couple of months" and 10% putting it off "indefinitely."

On one other question, realtors were asked to gauge whether buyers expect "lower prices now." In total, 63% of realtors said yes, buyers expect lower prices, with the greatest expectations around a 5-10% price drop. That's not a survey of actual buyers, but it's an intriguing finding.

There's plenty of "counter" chatter out there among realtors and housing economists saying that recessions don't always lead to home price declines, so no one should assume that's what's next in real estate. Buyer expectations do make for an important factor to track, however.

Here's the rest of our local real estate market update report for the period ending 4/15/20:

  • 82 active listings as of 4/15/20 (+2 from 3/31/20) 
  • 64 SFRs (flat)
  • 18 THs (+2)

See the Inventory list as of 4/15/20 here, or see the MB Dashboard for up-to-the-minute data.

Active listings by region of Manhattan Beach in this report:

  • Tree Section: 18 actives (flat)
  • Sand Section: 36 actives (-1)
  • Hill Section: actives (+1)
  • East MB: 21 (+2)

We're also providing a report on closed sales by region of MB.

Sales data, including PPSF for all properties, are organized by sub-region of Manhattan Beach.

Here's a link to the spreadsheet: "MB Pending/Sold as of 4/15/20".

Please see our blog disclaimer.

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