Trying, and Selling, in the Trees

By Dave Fratello | August 23rd, 2016

Inventory in the Tree Section is 50% higher than last year now, 30 listings versus 19 in mid-August 2015, and sales have been a bit sluggish.

But we wanted to call attention to a couple that have made deals recently.

747 18th Street Manhattan Beach CA747 18th (5br/4ba, 3625 sqft.) is one that was surely compelling, and was surely going to be selling. It would be only a matter of time and price.

This Spanish-inspired mid-80s house is at least adjacent to a great location, within sight of American Martyrs school and just one block off of leafy Laurel Ave. (The garage and 2br are on Pacific at stretch that can get busy around school and commuter times.)

The sellers moved out and commenced a quick refresher/remodel, meant to somewhat update the house – new master bath, new carpet and other flooring, paint and some work in the kitchen, etc. The light re-do made it possible to see the home as move-in ready and not hopelessly stuck in a bygone era. (This is a strategy that can have pluses and minuses, might work and might not work.) There was no doubt that they'd do what it takes to find a buyer.

The list price for this large Martyrs-adjacent home was $2.875M. That turned out to sound too much like $3M to draw bids for a home that still has a to-do list of updates/changes, in reality.

Soon it was down 9% to $2.629M, and they've now accepted an offer. 

$2.6M or so felt like the sweet spot. You could almost feel it when they made that most recent reduction 10 days ago: "There it goes!"

Curiously, the listing description changed with that last price cut to reference the popular (?), well-known local mattress-selling slogan, "You're killing me, Larry!" They really did that; you can look it up. Bravo for fearless marketing.

And then there was 794 27th794 27th Street Manhattan Beach CA (5br/4ba, 3075 sqft.), which recently sold. (Also on a corner with Pacific Ave.)

The custom Asian-modern, completed in 2003, had hit the market in June 2015, asking $3.290M, a price much higher in dollar value and PPSF than any resale of a home in the Tree Section for 18 months prior.

How much higher? It was 10% higher than the highest resale – a darling home in a prime location at 1812 Palm – and almost 20% higher than the highest PPSF for homes that weren't new construction, hovering around $900/PSF at the time.

If the goal was to not sell, this was great strategy: Overprice it, use an out-of-area agent and make it difficult to show.

They succeeded brilliantly. They accumulated days on market, made a bunch of price cuts, quit the market and came back, with almost nothing happening for long stretches.

Even the second out-of-area agent needed more than 5 months this year to draw a winning offer – and that came from an out-of-area, discounter online brokerage that rhymes with "bedspin."

In the end, though, the sale got done at $2.600M last week, 21% lower than the start price.

There's that $2.6 number again.

In a different market, this home had the distinction of selling for a big loss. (You can see our 2008 post from when the home went into escrow, "You Can Lose in MB.")

It was purchased for $2.500M in an off-market deal (or no deal) in 2006, but ultimately resold in January 2009 for $1.950M (-22%).

So they didn't get $3.3M this time, but at least they didn't suffer like the last seller. And at least they can say the value here was a tad higher than in 2006.

Now, about those 30 other listings...

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