Price Makes It Happen

By Dave Fratello | March 6th, 2018

Early in the year, we took note of 2605 Pine 2605 Pine Avenue Manhattan Beach CA(4br/4ba, 3325 sqft.), a late-90s house that came out asking $2.400M.

Balanced against the comps, it looked to be perfectly priced.

We called it "a lot of Tree Section house for the money," and observed: "it's as if the sellers decided they're just not going to mess around."

Yeah, no one messed around.

The listing was in escrow after just a couple of weeks, and has now closed for that asking price of $2.400M.

The comps you could pull up for this home ranged from $2.250M-$2.500M, but clustered around $2.400M, especially when you took full account of the home's assets and liabilities.

So, yes, everyone agreed, from the sellers and their agent, to a local blogger/broker, to the buyers. (And perhaps an appraiser as well.)

Perfectly priced = smoothly sold, with very little waiting or second-guessing.

It's invigorating to see people get the numbers right, and maybe that's what we've found compelling about this listing and sale, from start to finish.

Y'know, real estate is an imperfect market with considerable uncertainties built into every effort to sell. There's a proper price range for every property, but after finding that range, you can rarely be certain about what the market will bear... where a home will really trade.

This is where the art, and just a bit of educated guesswork, takes over.

The pricing process in Manhattan Beach is a project we love to tackle from both sides – buyer and seller - because of the diversity of homes in our 4-mile-square hamlet.

Built in the 1930s? Probably land value, but how are the views?

60s or 70s? Has it been expanded? How recently updated? How's that location?

Late 90s/early 2000s, that home's probably close to current standards, but how close?

And so on...

Pricing is not uniform or formulaic. You can use price per square foot as a guide, but that'll throw you wildly off course if you don't shape your data inputs carefully, using only like properties. You can look at land-value-plus-structure, but that can bite you if you overplay either part of the equation. You want direct sales comps, but they're often elusive.

We're not going to pretend that pricing properties is rocket science, but it certainly requires thinking humans with good data and, preferably, local expertise.

558 Rosecrans Avenue Manhattan Beach CADave's recently pending listing at 558 Rosecrans (3br/3ba, 1875 sqft.) was one that required lots of analysis.

For that kind of property, you need to reference other sales on Rosecrans, but there aren't enough. Other Tree Section properties belong in the analysis, also. And still there's some uncertainty.

The appraiser eventually blessed the purchase price of $1.750M as dead-on, however, so we know we did something right there.

2605 Pine Avenue Manhattan Beach CAGoing back to 2605 Pine, there was a little more we liked.

Having settled on a reasonable price, the sellers vacated the house, allowing light staging and giving the listing agent some freedom to have fun.

This was not a mere "late-90s Mediterranean" (with shingles).

No, it was christened: "Villa Completo. Where East meets West."

They had some fun relating the relative beach proximity of the home: "[S]teps to the beach...It's a little over a mile, so that's say...4500 steps+/-?"

And making light of the little balcony in front (like lot of homes have, but no one is sure why): "[T]here's also a 'speech balcony' off the front bedroom for Streetside Speeches."

It's that kind of lighthearted description, getting across the details but with a sense of whimsy and not-taking-ourselves-too-seriously-here that was refreshing.

Well, having done the hard work of getting the price right, they could stand to have a little fun.

 

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