You Don't Know Till You Ask

By Dave Fratello | September 8th, 2015

How rare is this in the past few years?

433 21st Street Manhattan Beach CAA new listing comes out. Ocean views. Newer construction. Good location.

The buyer comes in early and says, "Love it. We want it for $350K less."

And the seller says yes!

This unlikely scenario actually went down at 433 21st in August. (The sale just closed.)

The 2009 ocean-view TH is pretty much at the crest of 21st St. and gets good views across the street  to the south and west.

It's average-sized for a Sand Section TH at 3br/4ba, 1925 sqft. (We recently ran an analysis of several years' worth of TH sales in the Sand, finding the rough average of all Manhattan Beach townhomes sold to be more like 2100 sqft.)

There was a lot to recommend the home when it came out at $2.999M in late July. But was there support for $3M?

You have to understand that everyone who has a formerly $2M home now thinks it's worth $3M. The market has raised everyone's expectations. Even townhomes east of Highland like this one have been racking up impressive numbers.

Comps didn't exactly support $3M on this one. But they were equivocal. For every 328 Marine ($2.500M) or 319 28th Place ($2.380M) dragging down the value, there was a 305 8th ($2.990M) or a 315 Marine ($3.520M) saying "push higher!"

Given sales comps around $2.5M, $3.0M or $3.5M, you'd ask for more, wouldn't you?

Turns out, though, the sellers weren't all that committed the $3M number.

When a qualified buyer knocked, laid the cards on the table and said, "This is is $2.5-$2.6ish house. We'll give you $2.650M," the sellers knew they had a good deal.

Rather than wait out the Summer and argue with looky-loos, tourists and the DOM clock, the sellers took the deal.

433 21st closed last week at $2.650M, a full 12% under asking price.

Many buyers would have waited to present an offer like that, but if you like the place, you ask.

No tears for the sellers here. They bought good: $1.778M back in 2009. The resale was $872K more than the purchase price.

That's a nice return of nearly $150K/year. So even if they didn't get the extra $350K, they'll still be alright.

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