Buyers demand is up, supply is down, pent-up demand—fueled by prices that are still off their peaks—and continued low interest rates result in buyer confidence and a heated start to the second quarter. These conditions and buyers missing out on one or more properties due to multiple competing offers, driving higher prices for some Santa Monica sellers.
I last reported to you at the beginning of the year with a 2011 summary and year over year comparison, in which 2011 showed signs of a stable market. The number of available listings (too few) has led to a seller’s market in Santa Monica, and in particular in 90402.
As expected, after the first few months of 2012, the market has escalated, but what was not as expected is how quickly the market has built momentum. Again we have gains in most major categories for the North of Montana Avenue real estate market, such as improved (fewer) days on market, median sales prices, and overall sales prices.
Further supporting the seller’s market is the high listing to sales price ratio—currently a very healthy 97 percent, which is about the same as 2011. In a seller’s market, this ratio hovers close to 100 percent and in a declining or buyer’s market, the ratio can drop below 90 percent. It is evident that sellers and real estate agents are pricing properties at prices that are enticing buyers to compete with other buyers to purchase the same home. With so few properties available for buyers to bid on, it is as if sellers cannot list property too low, since numerous competitive bidding is often likely to raise the ultimate selling prices to levels that may exceed the actual value. This can create problems with appraisals but I will address that issue in a future column.
Not only was there a 42 percent increase in overall single family home sales this first quarter compared to last year, there were twice as many sales in the $3-4 million range, over twice as many in the $2-3 million range (which had the highest number of sales at ne total), and almost an equal number of $2 million and below sales.
Overall in Santa Monica, the North of Montana Ave 90402 zip code has remained the power house, enjoying the most activity and highest sales appreciation, including a $10.5 million condo sale on Ocean Ave.
My prediction continues to be modest price appreciation, therefore I'm cautiously optimistic about our local real estate market.
- 804 Woodacres Rd.: 5bd + 4.5ba., $6.49 million, new listing, Nearly an acre of land on this little known cul-de-sac. If you were to take 14th street across San Vicente you would find yourself on Woodacres Road. There may be some ocean view potential from a second story on this lot.
- Not in the MLS yet! 239 21st Place (see photo below). Price TBD. 5 bedrooms, 5.5 baths, apx. 5,692 sq ft home on an apx. 10,290 sq ft corner lot.
Overall, for single family homes in 90402, we have seen a 10 percent rise in the number of sales from the first quarter of 2011 and 30 percent increase compared to 2010.
Positive indicators for sellers are that buyers have multiplied in numbers as evidenced by numerous multiple bidding situations, for what is considered a steady but mostly low amount of available inventory for sale.
The number of days on market have shortened from 85 to 38 days for single family homes, and median sales has climbed to $2.69 million compared to $2.44 million in 2011.
- 514 9th St.: 5bd + 4.5ba., $3.19 million, sold in less than a week. A very nice new listing last sold in 2002 for $1.75 million. Mostly nice upgrades but still a bit 1980s in places. Good value based on the square footage.
- 317 23rd St.: 3bd + 3ba., $2.84 million. It is no surprise that this courtyard style Spanish hacienda sold so quickly. The garage was sub-par but the house had charm deluxe.
- 633 Euclid St.: 3bd + 2ba., $2.39 million. Bright and airy home with detached studio/ guest house with bath.
- 555 26th St.: 4bd + 4ba., $1.95 million. Huge approximately 9,900 sq. ft. lot. Original 1932 Spanish two story trust sale with circular driveway. Rehab or build new, create your dream house.
- 525 16th St.: 2bd + 1.5ba., $1.89 million. Picturesque country English in coveted north of Montana neighborhood. Great Value!