Pacific Shocker

By Dave Fratello | September 5th, 2013

As long as this year's rally continues, you're going to have to work to preserve some ability to be shocked.

We've already run a small (and unplanned) series of posts here at MBC about shocking sale prices. (Links below.)

Well, it's time for another.

The lucky subject this time is 1601 Pacific (4br/4ba, 2435 sq. ft.).

Did you know you can get $2M for a 1970s house on a busy street? Here, yes: $2,001,601, to be specific.

Or nearly $825/PSF in the Trees? Yes, this time.

We smell records being set for a home of this size and general location.

Now, of course, this home doesn't look like the 70s anymore. It boasts a good 2005 modernization that opened and upgraded the kitchen, and it has nice detail work all around.

And the relative busy-ness of Pacific Ave. can be minimized as a location issue if you like the school proximity (yep, it's got that) and walkability to town and beach.

In our late-June review, we called the home "warm" and generally indicated we liked it. But we added a concern: "[t]hough the great room in back is a good space, opening to the sunny yard, a general shortage of common spaces seems to be the consequence of the smallish square footage. (We say that [even] though we really want to see 2400-2500 sq. ft. work. It's enough, right?)"

And that yard is accessed down steps off of a little deck, so it doesn't flow optimally.

In short, you could really like the house, but not without some reservations.

Oh, but lots of buyers showed no reservations at all. They said, "must have." And a $1.799M start price was obliterated.

In that review in June, we also said, "The start price here really struck us – $1.8M for less than 2500 sq. ft. on Pacific. No matter how nice, that's a very interesting barometer for this market. You'd have seen this in the 1.3s-1.4s just a couple years ago, we'd hazard."

The 1.3s or 1.4s in recent years... $2M today. Yes, that's a "very interesting barometer," Dave.

Now, we can't all just sit here goo-goo eyed and say, "wow, big number." We need some context.

So here's a trademark MBC deep dive.

We looked back at the sales data for all homes under 2750 sq. ft. sold in the Tree Section going back 6 years.

1601 Pacific is the priciest of all going way, way back to Spring 2007, pretty much the end of the last bubble.

The only 2 sales in Spring 2007 to exceed this one were both in the Martyrs neighborhood, where land values are among the highest in the Trees. Those were one with a bigger lot at 524 15th at $2.487M (July 2007), and 660 17th at $2.175M (May 2007).

So the sale here at $2M, for less than 2750 sq. ft., is at least a 6-year high.

We expanded the search all the way back to 2002 to pick up the full run of early-2000s madness.

With that expansion, all we added was 3 more Martyrs-area homes, all with large lots (6200+ sq. ft.) and one super-size lot sale (8000 sq. ft.).

That makes 1601 Pacific a historic peak sale for all Manhattan Beach Tree Section homes not in Martyrs – the highest ever for this kind of location and square footage.

The nearest high sales for "midsized" homes like 1601 Pacific that are not in the Martyrs neighborhood are on John St. and Palm Ave., two streets that seem to be a pricey submarket unto themselves, and they're all recent:

  • 1905 John (4br/3ba, 2300 sq. ft.) (pictured), $1.959M (sold 3 weeks ago, mid-Aug. 2013) - this one has a huge yard but needs a kitchen update
  • 1820 Palm (5br/3ba, 2450 sq. ft.), $1.900M (Aug. 2012) – snazzy re-do of a recognizably 70s house, no yard
  • 2301 John (4br/3ba, 2600 sq. ft.), $1.880M (Nov. 2012) - large corner lot, mid-century modern, turned rental right away; for our shocked story on the 24% overbid there, see this post

Now if we're going to eliminate Martyrs locations plus Palm and John (i.e. prime) locations, really the one and only analogous house we find that sold over $1.8M is 2317 Pine (4br/4ba, 2600 sq. ft.), a 2008 sale of a renovated 1970s build. That sale hit $1.878M in April 2008. There is just no other example going back 11 years.

As we said up top, 1601 Pacific smelled like a record being set. Yep.

It's a historic peak sale – until the next one beats it.


Below are links to all of this year's past "Shocker" stories. We have now even created a new "blog categories" tag for these posts ("shockers"), so you can pull them all up with one click. (See the right-hand sidebar.)

"Walnut Shocker" – 1312 Walnut at $1.760M

"Shocker on 12th" – 725 12th at $1.620M

"Highland Shocker" – 232 30th Place at $1.361M

"Rosecrans Shocker" – 610 Rosecrans at $1.635M

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