Not Everyone Gets Asking Price

By Dave Fratello | December 15th, 2015

It can be hard, in the middle of a bubble market rally, to notice that sellers' asking prices aren't always met or exceeded.

You get so accustomed to talk of "bidding wars" and "over asking price" sales, you might forget that:

  • some sellers overshoot,
  • some properties don't have the inherent value that the first calculations suggest, and
  • some buyers have leverage, too, these days to get decent deals.

But the proof comes in the sale prices... quite a few at this time of year, for whatever reason, seem to be coming in low. Here are some of the more interesting closings to post recently where the original asking price wasn't too close to the mark.

835 17th Street Manhattan Beach CA835 17th (6br/6ba, 5900 sqft.), which we've called a huge and luxe Spanish on a rare 50' wide Tree Section lot with an even rarer 8000 total sqft. of land. The home features an extra-large basement and a somewhat newly tricked-out backyard with pool and entertaining areas.

Easy to love, but a $5.800M start price – beginning back in May – turned out not to be close. A more recent listing at $4.999M was closer, and the sale price this week of $4.780M established a proper value, albeit $1M under that first asking price. (Disclosure: Dave had clients who toured the property recently.)

815 2nd Street Manhattan Beach CA815 2nd (5br/6ba, 4725 sqft.) is a newer Cape Cod in the Hill Section along a somewhat busy street. There are some modest views to the south and west, although the home maintains a traditional floorplan with common areas downstairs – instead of a reverse floorplan to capture the views. So views become secondary.

While the home is very stylish, the layout also seems somewhat broken up, more like a series of smaller rooms rather than a grand 4700+ sqft. home.

A Hill Section house with that kind of square footage might have been a $5.0M house, the price they were asking in early May, or a $4.4M house, as they were asking in September. Turned out to be a $4.275M house, according to the buyers who closed this week.

Backstory: As a spec build in 2008, this one was listed at $4.8M, dropping below $4M, then $3M and finally selling for $2.650M at the very end of 2009.

518 24th Street Manhattan Beach CA518 24th (2br/1ba, 980 sqft.) is a gaslamp section cutie, with some unofficial square footage in a finished attic. (Yes, it's a pain to climb an attic ladder to your bedroom, but you know your parents love you if they move you to the beach – so quit your complaining.)

Asking $2.100M in September, this one just sold for $1.920M, about 9% under asking.

706 Anderson (3br/2ba, 1900) is a tall-and-skinny 1960s house with a fresh, recent interior modernization.

Apparently in no hurry to sell in July, they listed it at $2.095M. We had clients look at it and put a number on it much lower.

After 4 months on market, this one just closed for $1.733M, significantly less than we had expected, and 17% under the original asking price. That now looks like quite a deal.

18 Santa Cruz (3br/3ba, 1965 sqft.) is an original Village TH (Plan 4) that was on the market for a spell from June-September at $1.250M originally. 

The price wasn't an egregious overreach, especially as they dropped it to $1.220M. Then along came hot hot hot 1 Coronado, with the same floorplan but an over-the-top, spectacular remodel, closing for $1.400M.

18 Santa Cruz was going to have to sell lower. The original listing quit, but Dave got clients in and made a great deal: $1.150M.

Here, we even had the rare experience of seeing the appraisal come in higher than the contact price. That makes you feel good.

901 North Peck Avenue Manhattan Beach CA901 N. Peck (5br/3ba, 2840 sqft.) seemed obviously out of whack, pricewise, when it launched in May at $2.000M.

It's not unattractive, but the floorplan is unconventional and most of the updates to this 1950s original... er, need to be updated again.

Watching comparable homes sell all around the area, the sellers were very slow to adjust their price, gradually coming to $1.9M and then $1.8M.

The sold price at $1.700M a few weeks ago came after 150 DOM and marked a 15% chop off the start. Somewhat like with 706 Anderson, we had instantly seen this as overpriced to begin, but expected it to settle higher than the actual closed price.

85 Bayview Drive Manhattan Beach CA85 Bayview (3br/4ba, 2075 sqft.) is a remodeled South End TH with slimline ocean views.

There's no debating the style: It's crisp, recent and very now, with newer flooring and nice cabinets and all.

Perhaps the floorplan is a bit odd, with the lowest floor hosting two bedrooms, including one with a way oversized bathroom down a long hallway. But the midlevel master and top-level common rooms are straightforward and nice.

Listed at $2.899M and running more than 5 months, this one just settled at a closed price of $2.625M, or 9% under asking.

So, yes – these days, plenty of sellers in Manhattan Beach are getting multiple offers and above asking price. 

But not all.

And some of these sellers have proved true the old lesson: Price too high to begin, and you may end up taking a lot less.

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