The median price for Single Family Residence’s “SFRs” west of Sepulveda was down 22.4% ($1.980m to $1.535m), comparing the first half of 2007 with the first half of 2009.
There are two major factors with the median price drop. Obviously, due to the economy and less demand, the same properties are trading for less money. For example, a standard Tree Section new construction home built on speck might have gotten $2.1m-$2.4m in 2007, will now go for between $1.6m to $1.8m.
The other and more significant change, which is the case in all coastal communities, is the amount of sales in specific price ranges.
In 2009, the bulk of sales are at the lower end for the area West of Sepulveda (under $1m), pulling the median price down while sales at the higher end ($2m-$3m) are stagnant with the super high end (above $3m) staying fairly steady over the past 3 years.
About half of the Jan.-June sales in both 2007 and 2008 occurred below $2m. In 2009, fully 75% of sales were in that range. That’s a significant, 50% increase!
Another number that really stands out is the share of sales priced below $1m. Accounting for only 2-5% of all sales in 2007-08, low-end sales hit 21% of all sales in 2009.
The biggest drop in sales happened between $2.5m-$3.0m, which have accounted for 1% this year, in 2007 and 2008 it was at 12% and 15%. If you look at the range of sales between $2.0m-$3.0m, it shrank from 30% in 2007-08 to around 13% this year.
Here are the numbers of sales in the 2 categories with the greatest change:
Sales Priced At $1m or Below
Sales Priced Above $2.51m, up to $3.0m
Please note, this is from MLS data and excludes off-market sales.
The sales pace for the area is off 41% from the first half of 2007 (129 closed sales vs. 76). The scary thing is the first half of 2007 from an historical perspective was one of the worst performing periods compared to the prior 20 years.
Due to lower interest rates, higher inventory and the over 20% price adjustment in the market, I predict sales volume in West Manhattan Beach to pick up throughout the rest of 2009 and into 2010 while the median sales price continues to decrease at a slower, steadier pace.
(*Sources: The MLS, Manhattan Beach Confidential)