Home Buying in 90266>Question Details

John, Home Buyer in 90266

How is it prices in some areas like Manhattan Beach are still increasing?

Asked by John, 90266 Sun Feb 10, 2008

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19
Supply and Demand. MB has gone up over 17% since the same time last year (from latest LA Bus. Journal.) There is only so much land there and as long as people find it desirable, it will continue to go up in value. Also so much building has taken place, if you have a SFR rather than a townhome..value goes up.
3 votes Thank Flag Link Sun Feb 10, 2008
Hi John,
Contrary to what the news is saying, the real estate market is not crashing and burning. It is true that there are areas which have been hit very hard due to subprime lending practices. It is also true that there are areas throughout the Los Angeles area and other areas throughout the country where prices are remaining stable and in some instances are still rising.
Where ever you choose to buy, you should do your research carefully and look at local trends in the market place. Then you can make an informed decision.
Nancy Sanborn
The Sanborn Team
310-777-2858
Web Reference: http://www.sanbornteam.com
1 vote Thank Flag Link Mon Feb 11, 2008
After living and working in MB for nearly ten years and I am asked that same question repeatedly. Buyers are often shocked at the prices in MB. My quick answer is that we beautiful beaches, fantastic restaurants and shopping, an award winning school system, easy access to freeways providing shorter commute times etc. In the last few years several other factors have been added to the mix. One of these is the astounding “mansionizing” effect that has been going on for many years in MB. Small (under 1000 sqft) beach cottages are torn down and replaced with multimillion dollar homes. When those homes are resold, the median home prices increase over all. Now add the fact that volume sold in MB dropped nearly 50% last year. From a purely statistical stand point fewer homes sold with higher price points will explain “some” of percentage increase in home values being quoted in the Los Angeles Business Journal.
Recently I have also seen that many if my buyers are coming from out of the country. Seems news of all the wonderful things MB has to offer is “going global”. Since the Euro is so strong against the dollar we are actually a great value for people coming from Italy, Canada and New Zealand to name a few. They see MB as the perfect place for vacation or rental homes. So you have a scarce, valuable resource with global competition it’s no wonder prices in MB are more resistant to market fluctuation.
Did I mention our beautiful beach….
Web Reference: http://www.KellyKGibson.com
1 vote Thank Flag Link Mon Feb 11, 2008
When the economy is bad, the lower income people are effected more than the upper income people who have a surplus of income.

Reputation of good schools and a safe community. Close to the beach. Executives and sport figures flocking to the area. There is simply not enough property to meet the demand.

Jo Ann Rodda, "The Old Pro"
0 votes Thank Flag Link Tue May 27, 2014
Manhattan Beach is one of those places that will always attract folks who want to live in our community. We are usually the last market to fall and the first to recover. Say what you will there are just not many places left in CA like the communities that make up the LA County Beach Cities.

While we saw prices take a dive we have also seen them recover much faster than many people anticipated. Real Estate usually runs in 7-10 year cycles. I have been selling in Manhattan Beach since 1979 and have seen a lot of ups and downs in our local real estate market. Manhattan Beach home prices have always recovered and increased over the previous market values.... maybe it won't always happen but so far this is the pattern.
0 votes Thank Flag Link Tue Jul 16, 2013
Kaye Thomas, Real Estate Pro in Manhattan Beach, CA
MVP'08
Contact
It's funny to find this 5-year-old question, but here we are after a few years of depression and prices actually are rising again, and almost alarmingly quickly.

I prefer to call it like I see it. In '07 I said "look out below," these past couple years it's been "look out above." What's next? We have to see if there's a sustainable power behind the current price increases.

Here's my post on median prices increasing in Manhattan Beach in the first half of 2013:

http://www.mbconfidential.com/blog/mb-median-prices-finally-…

Maybe we'll look back at that one, too, in 5 years...
Web Reference: http://mbconfidential.com
0 votes Thank Flag Link Tue Jul 16, 2013
Prices have just recently began to increase again. The primary reasons are the desirability of the area, scarcity of buildable land, low inventory, and greater demand than supply. Flavia Brown, Realtor
0 votes Thank Flag Link Thu Sep 20, 2012
Very Limited suppy and lots of pint up demand not to mention record low interest rates!
MattWaxman.com
0 votes Thank Flag Link Tue Apr 17, 2012
The prices are not increasing in real terms. Watch what happens when rates are not at all time lows. Also consider the ongoing nuclear fallout on hitting the West coast. Tokyo is about to get evacuated.
0 votes Thank Flag Link Mon Apr 16, 2012
3 1/2 YEARS OLD!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
0 votes Thank Flag Link Sun Jul 17, 2011
I have lived in Manhattan Beach all of my life. It really is not surprising that prices hold strong and even go up contrary to other markets. It really comes down to what you want for your family, what you value and what you are willing to pay for it. Manhattan Beach has always attracted families due to the incredible school system, I know, I attended them myself and am glad I had the opportunity to be educated in that system. The community has so much to offer with great parks, the incredible beach, the beautiful Pacific Ocean, the wonderful downtown area, the proximity to the freeway, proximity to LAX, proximity to dining, proximity to shopping- the list goes on and on. Knowing how Real Estate values have held up and performed historically continues to make Manhattan Beach a solid investment. People want to live here, be a part of the community, have access to all of the great opportunities for their families, feel confident about their Real Estate Investment and enjoy all that this life has to offer.
0 votes Thank Flag Link Sun Jul 17, 2011
Supply and demand. The market is also driven by inventory, financing, desireability (location). We have a perfect storm right now, low rates, tax credit, 2006 prices, additional purchasing incentives, buyers who dont get off the fence soon will find themselves in the eye of the multiple offer MB hurricane.
0 votes Thank Flag Link Mon Jan 18, 2010
Demand and desirability. Please see ManhattanBeachRE.com for all the info you need on buying in Manhattan Beach. Good luck!
Web Reference: http://ManhattanBeachRE.com
0 votes Thank Flag Link Mon Jan 18, 2010
The reason it appears that Manhattan Beach prices are rising is that homeowners at the very high end generally are better able to withstand a turn down in the economy. We are now in the third year of a down market. Previously well-healed homeowners are beginning to feel the pinch and are getting more realistic about home values. More higher end homes are selling, but at reduced prices. The effect of this is to skew the average sales price of a home upward, which makes it appear that values are increasing, when in reality home prices are still falling.
This doesn't mean that it isn't a great time to buy! Interest rates are at historic lows, locking in a low interst rate and mortgage payment over the long term will more than make up for any temporary loss in market value. You just have to look for the home that fits your needs perfectly and negotiate hard!
0 votes Thank Flag Link Wed Dec 16, 2009
Basically...Quality of life. People will pay a premium to live in MB as it is a very desirable community and a relatively small area.
Having said that - i'm not seeing prices increase in MB. Price are lower than they were a year ago, inventory is up, as is list time on the market.
For very detailed info on MB - The Strand, Hill, Tree, Walkstreets, etc, please check out ManhattanBeachRE.com - you can also search the MLS for MB homes by specific area directly from the site.
It is also a detailed guide to life in the city and has many stunning images.
Web Reference: http://ManhattanBeachRE.com
0 votes Thank Flag Link Fri Sep 11, 2009
Well, it as to do with location and expected appreciation on investment. Supply and Demand.
0 votes Thank Flag Link Sun Apr 12, 2009
If you haven't found a home yet then you may find that prices in Manhattan Beach are finally coming down. Prices have decided about 20% overall. Most sellers have realized that we are in a changing market and there are some deals to be had in Manhattan Beach.

Now that doesn't mean prices are not still on the high side... they are. Prices in most beach communities are well above those in surrounding communities. The good news is that lower prices and the return of jumbo loans to the market mean a buyer who wants to buy now may just find a deal or two or three.
0 votes Thank Flag Link Thu Apr 9, 2009
Kaye Thomas, Real Estate Pro in Manhattan Beach, CA
MVP'08
Contact
Hi John,
If you graphed it, prices would ultimately be determined by intersection (or equilibrium point) of the supply and demand curve. However, to better understand the answer as to why Manhattan Beach prices (were) still increasing, you must consider at least some of the many macro and micro level forces that affect supply and demand.
For example, on the demand side, demand on Manhattan Beach housing stems from major aerospace and defense employers (i.e. Raytheon, Northrup Gruman, and nearby Boeing). As these companies expand or contract, pressure on the housing supply expands or contracts as well. Most of these jobs are white collar and their associated salary allows them to pay a higher price for housing. Further, the employees want to live close to their work.
On the supply side, we are obviously bordered by the Pacific Ocean, so that immediately increases the price pressure because only certain streets (i.e. west of Alma) can actually see the ocean. Literally, housing supply has a hard border. The ocean, and our beautiful beaches, are something that can never be taken a away from our city, which creates a supply constraint.
Another major supply issue is related to the credit markets, or the ability for a home buyer to get a loan. This is big topic that is outside the scope of this answer.
Other factors that affect price of housing include safety and quality of schools. Because prices are high, taxes are high, residents are wealthy, and our city can afford to have an excellent police force and top-notch schools. Over time, this creates a population that is increasingly wealthy and educated which is cyclical in nature.

Justin Reese
JRealty
229 28th Street, Manhattan Beach, CA 90266
o) 310 545 5269 | c) 310 980 1660 | f) 310 545 7804
justin@jrealty.org | http://www.jrealty.org
Web Reference: http://www.jrealty.org
0 votes Thank Flag Link Thu Nov 6, 2008
Hi John,
I have lived and worked in Manhattan Beach for over 17 years now and the prices in Manhattan Beach are declining contrary to what some Realtors may think. The good news is that since there are so few foreclosures the prices have not dropped like they have in the areas hit hard by these. The credit crunch has made it hard for people to get loans so we see a decrease in the number of sales and people putting their homes on the market. A home will stay on the market now for anywhere from 6-8 mos. A lot of new homes have been sitting for even longer. New construction has almost halted because builders can't get construction loans. All of these factors have contributed to declining prices and a buyer's market. Manhattan Beach is a very desirable area to live and the savvy buyer with good credit and some cash can come in and buy properties for around 25% less than what they could when the market was booming.

Michelle Bond
Shorewood Realtors
Manhattan Beach
310-600-0118
0 votes Thank Flag Link Tue Oct 28, 2008
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