October Closings Not Slower in MB

By Dave Fratello | November 8th, 2018

We continue our contrarian quest for data that might show our real estate market slowing.

And again: Not yet.

You already know that "everyone's saying" the market is slow or weird, maybe turning.

We began compiling and publishing data here in early October to try to find out what the heck everyone was talking about. If it "feels" slower, that's got to be in the data somewhere, right?

We used data that went back from Sept. 30 to earlier in the year, and did several comparisons.

Now we have October data.

The number of closed sales in October was not lower than the number sold in 2017 within the same month.

In fact, the 34 closings within Manhattan Beach during October made the month tied for 3rd best in the past 10 years.

We were up 8 sales over go-go 2017.

Of course, very few of those sales occurred entirely within the calendar month. You need the property to hit the market, get an offer and close within 31 days. Our look at the data shows that only the land sale at 1245 3rd ($4.200M) seems to have performed that feat.

So closed sales are a slightly lagging indicator. They tell you about market action going back to maybe late August through September. Normal escrow periods run 30-45 days.

At any rate, these numbers do not seem to tell us that the market had been slowing in August/September, and had simply failed to produce data as proof when we were asking questions in October.

Maybe people aren't talking about Manhattan Beach!?

Maybe it's the whole South Bay?

We crunched those numbers, too.

Here are the number of sales closing within October for all major South Bay markets combined: El Segundo, Manhattan Beach, Hermosa Beach, Redondo Beach, Torrance and Palos Verdes.

The result is the same.

In fact, it's spookily the same.

October sales are up by 8 total from the same month last year.

Those extra 8 sales are in Manhattan Beach!

Without MB in the data, South Bay sales within October would be exactly flat year-to-year.

Still, that's not "down."

A trend of sorts is a bit more evident in the South Bay data: Octobers in the last 2 years are each a bit slower than Octobers in the prior 3 years.

OK, but if that doesn't exactly scare you, you're normal. "Scary" is a word for periods like October 2010-2011, with 30% lower sales volume than 2018.

If you're trying to be a seller in a market with lower overall sales activity, you have to price more enticingly (i.e., lower) to gain traction. That's why you should care about lower sales totals.

So once again, we're having trouble matching facts to the "buzz."

The time may come (again) when things turn, and we'll use data like this to document what's going on.

We probably need to wait till the close of Q4 to have another meaningful data set on sales to work with, however, with the natural seasonal slowdown in market activity expected to take hold soon.

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Complete list of recent market data posts:

"Housing Stats That Worry Experts" - Oct. 30; uses statewide and regional data (not just MB) to spot indicators

"Median Prices Through Q3: Up Again" - Oct. 8; compares prices and # homes sold over 6 years

"Q3 Stats: Bounceback in Pending Sales" - Oct. 4; uses 6 years' worth of data on pending sales for Q3

"MB Market Update for 9/30/18" - Oct. 3; features comparative sales data (Q1-Q3) and inventory data from 2017-18

 

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