Walkstreet Premium Still About 15%

By Dave Fratello | July 25th, 2019

Down in the South End of the Sand Section, we've often pointed to the difference between walkstreet and non-walkstreet homes.

Among the flat family walkstreets east of Highland, a walkstreet home is typically worth about 15% more than an equivalent home in the South End off the walkstreets.

320 7th Street Manhattan Beach CAWith the sale of 320 7th (5br/7ba, 4320 sqft.) this week, you see that margin holding up.

The new construction home launched in early June and didn't hang around long at all. (See our writeup in the June 8 Weekend Opens post.)

List price was $6.595M, and the closing was quite near that at $6.550M.

One quite interesting fact about this home was that it was a virtual repeat of a floorplan sold in August 2016 just off the walkstreets at 516 4th.

Same builder, same floorplan, similar enough home overall... but 516 4th sold for $5.250M, or 25% less than the walkstreet version.

There have been 5 trades of new homes off the walkstreets since then, all higher:

441 3rd (5br/5ba, 4320 sqft.) at $5.350M (Aug. 2016)

500 4th (5br/5ba, 4175 sqft.) at $5.600M (Feb. 2018)

81 Morningside (5br/6ba, 4250 sqft.) at $5.650M (March 2018)

425 2nd (5br/6ba, 4130 sqft.) at $5.575M (Sept. 2018) (pictured)

81 Morningside (again) at $5.499M (April 2019)

Let's call the typical sale there $5.600M, and the spread to the walkstreets, the "walkstreet premium," is 17%.

Now, of course, we are making some assumptions, such as build quality/finish being equivalent, which may be worth a quibble.

That 25% difference between the same builder's product is tempting to cite as the walkstreet premium, but that comparison is confounded by the 3-year difference in time. The market clearly moved up to some degree after that 2016 sale.

Much like the rule of thumb that it costs $1M more to buy the same house west of Highland - oh, shoot, it's more like $1.5M+ now, but we digress - the "walkstreet premium," whether it's 15%, 17%, 20% or more, is just shorthand for "people are always willing to pay a little more for the walkstreet lifestyle.

Of course they are. Where else are you going to find anything like it?

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