|Redondo Beach Golden Hills SFR|
If you've been thinking of buying, selling, or investing in Redondo Beach Real Estate and trying to figure out where things are going, hopefully these few random thoughts from yours truly will help you sort things out.
- We've seen a nice flow of new listings hit the market over the last few weeks. Probably not enough to meet pent up buyer demand and the flood of new listings buyers were expecting to see as we got further into the selling season is not likely to materialize.
- Even with the low persistent low inventory more than half the Redondo Beach listings linger on the market for over 30 days. This holds true whether we look at active, in escrow or recently closed sales. Something closer to 40 days on market (DOM) is a more accurate reflection of reality.
- About half the listings will sell at or above the most recent list price and half below. Buyers are armed with a ton of data, much of which they misinterpret, and are only going to bid up properties priced extremely competitively or those that offer an unusually desirable amenity or benefit.
- Interest rates are very much in the news again with talk of a rate hike. While short term that may not immediately affect mortgage rates, it will over time tend to drive rates up. As I have written about previously, present price acceleration most likely can not be sustained if rates go up more than 50 basis points.
- As Redondo Beach prices have continued to climb we are seeing substitution becoming a more prevalent factor. Specifically, those priced out of Redondo Beach SFRs are more actively looking in Torrance now - as opposed to just buying a townhouse. With 3 on a lots around $800K and nicer 2 on a lots over $1M, those price points still buy a lot more elsewhere in the South Bay.
NORTH REDONDO BEACH
Currently Active: 35
In Escrow: 64
Closed YTD: 173
SOUTH REDONDO BEACH
Currently Active: 60
In Escrow: 87
Closed YTD: 141
Currently Active: 56
In Escrow: 35
Closed YTD: 73
Currently Active: 119
In Escrow: 57
Closed YTD: 130
You will often see analysis of absorption rates based either closed sales or sales under contract (UC). Either way you look at it, outside of North Redondo Beach, the trend isn't very attractive.
Let's start with Manhattan Beach and work our way from there.
There are currently almost as many homes listed as have sold through the first (almost) 5 months of the year. If we look at the UC compared to active listings it is not exactly a seller's market and that only gets worse if you factor in closings so far this year. Zillow has defined MB currently as a "cool" market.
In Hermosa Beach, the balance between YTD closed sales and currently active listings is not much different although the UC ratio might be somewhat more favorable.
As we get to South Redondo, the closings YT and UC properties start to tilt somewhat back to favoring sellers and North Redondo is still a seller's market with the most demand and fewest listings.