Prime Tree Section Lot Values Up Again

By Dave Fratello | February 27th, 2018

If the median home price trend is up, then guess what happens with land values?

In the Grand View area of the Tree Section - north of Valley and west of Pacific - you'll find a few new lot sales that mark out new peaks.

664 27th Street Manhattan Beach CAA couple of weeks ago, it was 664 27th closing at $2.250M.

We can't find a comparable pure lot sale in the area that's ever gone higher, certainly among public market sales.

664 27th has a 5120 sqft. lot, 40' wide and 128' deep, about 300 or more sqft. larger than most typical Tree Section lots, and great for the area.

And the location? West of not only Agnes, but west of Flournoy, on a gently sloping block that takes you down toward the school. The beach is fully walkable from this little suburban block.

They tried to ask less ($2.100M), but had to take more when offers rushed in.

Is $2.2M+ where lot values have been heading inevitably?

That wasn't clear when a mid-2017 listing at 742 29th came out.

742 29th Street Manhattan Beach CAThe sellers put that 4800 sqft. lot up on the market at $1.899M, and someone might have wondered if they were a little optimistic at the time.

No matter, the market corrected them: Upwards by over $200K.

742 29th closed for $2.118M after a bidding war, and may have reset expectations.

But you can see why we say maybe the $1.899M was optimistic mid-year last year.

The previous lot sale in the same basic area, 653 27th (another 4800 sqft. lot), had struggled a bit in late '16-early '17, coming out asking $1.799M and sitting for 90 days before selling for $1.650M.

So if your nearest comp was $1.650M, $1.899M may have looked ambitious... until it proved not to be ambitious enough.

Now, yes, there are differences among these lots.

653 27th, the low sale, has its yard on the north side, while 742 29th is on the south (sunny) side.

Then again, you'd give marginally more value to a 600-block location than a 700-block location. (Once you're doing this, however, you're almost splitting hairs. Ready to debate 29th vs. 27th?)

There was, perhaps, no way to predict that 742 29th would sell for 33% more than 653 27th had just 5 months earlier. Except for the market heating up, and a different mix of buyers rushing in.

The big deal here at 664 27th has its yard on the south side, too, and is larger than the others, by a nudge. That plus great timing brought the new high of $2.250M.

Two other nearby lot sales in the Grand View area also had not suggested that $2.2M+ was coming soon.

743 31st closed in June 2016 for $2.000M.

That's on treasured 31st St., a 5000-ish sqft. lot backing up to the alley. (It's a construction site now.)

And an oversized corner lot (~6500 sqft. with some slope) at 2921 Laurel sat and sat on the market before closing for $1.852M in August 2016.

That was way, way down (-24%) from a too-ambitious $2.449M start in April that year. This was not fully 2 years ago. It appeared possible even then that the lot sale market was cooling.

The $2M+ kinds of numbers for land are somewhat more to be expected in the Martyrs area and nearby on Palm and John.

Consider 2105 Agnes, a 5000 sqft. lot that sold off-market for $2.100M in Feb. 2017. (It's a construction site now.)

Or look over at 1900 John (5025 sqft. lot) and 1904 Palm (4480 sqft. lot), both of which sold for $2.200M in late 2015.

The Grand View district hasn't quite hit the peakiest of peaks set in the Martyrs area, however: 1812 Agnes closed for $2.500M in April 2016.

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