The weather is cooling down but the real estate market is heating up.
Existing home sales in the U.S. rose 9.4% in September of 2009, due to low interest rates and the $8,000 tax credit for first time home buyers. As for the Westside, I think the main reason for the increase in purchasing power is the overall improvement in stock portfolio performance, and buyers feeling that we are at or near the bottom of the economic downturn. The Dow Jones Industrial Index has risen roughly 50% since March, closing above 10,000 for the first time in over a year. For many Westsiders, the main source of income for closing escrow comes from liquidating positions in an investment portfolio.
So has our real estate market bottomed out?
This is the question I get almost every day from overseas buyers and local residents. From what I’m seeing, our Westside market is super hot. All of my listings have been selling in multiple-offer situations. Successful sellers align themselves with current market conditions, knowing they probably won’t be able to sell their homes for the high price of few years ago, and buyers know that interest rates aren’t going to get lower than those in effect right now.
Let’s see how the Westside markets performed during September through the beginning of October:
Santa Monica: Condos
From September 1 to October 15, 2009, 47 properties out of 153 active listings went into escrow, with an average Days On Market (DOM) of 76 days. Total Sold in the time frame is 44 homes, with an average sold price of $748,000.Brentwood: Condos
From September 1 to October 15, 2009, 21 out of 72 listings went into escrow, with an average DOM of 74 days. Total Sold in the time frame is 24 condos, with an average sold price of $720,000.Brentwood: Houses
From September 1 to October 15, 2009, 37 out of 135 active listings went into escrow, with an average DOM of 101 days. Total Sold in the time frame is 34 homes, with an average sold price of $2,700,000. Six of them sold for close to asking or above asking price.Pacific Palisades: Houses
From September 1 to October 15, 2009, 14 out of 165 active listings went into escrow, with an average DOM of 99 days. Total Sold in the time frame is 22 homes, with an average sold price of $1,900,000. Eight of the homes sold for close to asking or above asking. A very strong market indeed.Malibu: Houses
From September 1 to October 15, 2009, 6 out of 265 active listings went into escrow, with an average DOM of 97 days. Total Sold in the time frame is 12 homes, with an average price of about $3,200,000. A couple of them sold very close to the asking price.Beverly Hills: Houses
From September 1 to October 15, 2009, 13 out of 125 active listings went into escrow, with an average DOM of 112 days. Total Sold in the time frame is 14 homes, with an average price of about $4,900,000. Four of them sold way above asking price. (See below for more details.)Santa Monica: Houses
From September 1 to October 15, 2009, 15 out of 95 active listings went into escrow, with an average DOM of 53 days. Total Sold in the time frame is 37 homes, with an average price of about $1,900,000. Seven of them sold for close to asking or above.Mar Vista: Houses
From September 1 to October 15, 2009, 20 out of 58 active listings went into escrow, with an average DOM of 45 days. Total Sold in the time frame is 38 homes, with an average price of about $777,000. Eleven of them sold for close to asking or above.Clara's Note: The market has been very strong since August. Properties are selling when they are priced right. Many properties after listed for months with no action, sold immediately after the price was reduced to the right amount. This is true for all price ranges in the Westside.
Beverly hills has been very busy with over-bidding:
1076 N. Hillcrest Road listed for $2,800,000. This four bedroom fixer on a 23.8k sq. ft. lot sold for $2,900,000.
808 N. Camden Drive listed for $3,195,000. A five bedroom, Mediterranean estate located on the flat, this house sold for $3,471,000.
1024 Summit Drive listed for $6,950,000. This mid-century modern home located next to the Benedict Canyon sold for $7,150,000.
In Brentwood Park, 200 N. Cliffwood Ave. listed for $5,795,000, and sold for $5,800,000 — priced at the value of the lot alone.
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Where are the Real Estate Bargains?
Everyone has different definition of “good deal” and “bargain.” As for me, I don’t care to buy a home in an inferior location just because it is at a low price. I have seen people buying a “good deal” home and then spending hours each day commuting to work. That is not my definition of “quality living”. I believe in having it all, now and in the future. We can choose to live in the neighborhood we love, and at the same time, make it the best investment of our lives. It’s achievable. The greatest joy in my work is to advise and assist my clients to achieve just that.
As I said in my previous post and newsletter, every house on every street is unique in its way. Part of my expertise is to match the house to my client’s lifestyle and investment objectives. If you are interested in taking advantage of the current market conditions, call or email me to set up a consultation.
Aiming High
On Sept 23, 2009, the Wall Street Journal published an article headlined “Seeking Real Estate Bargains? Try looking at the High End.”
“While the latest data suggests prices for mainstream homes may be stabilizing after several years of pain, the news for luxury homes isn’t looking as good.”
It is quite true that many multi-million dollar houses can stay on the market for a long time unless they are priced right to sell. The fact that they can be bought immediately illustrates the resilience of our local real estate market. I personally live and invest in the Westside market, and I definitely agree that there are great bargains in our high end market right now.
Among all the quality bargains, here are few of my favorites:
120 S. Burlingame Ave, in Brentwood Park — Listed for $7,995,000
A Mediterranean Villa newly built in 2009, this house has 8 bedrooms, and 12,000 sq. ft. of space on a half-acre lot. This home cost about $12 million a few years ago. Just the lot value in Brentwood Park is around $6 million.
1805 Melhil Way—Listed for $9,995,000 and sold for $9,100,000
This is a one-of-a-kind, exquisite brand new Hacienda house on a 3 acre private knoll on top of Sullivan Canyon. Many of my clients like to build a house on top of a hill, and there are not that many hilltop sites that are close to the city. This is about 5 minutes north of Sunset. Living here is truly like being on top of the world— like owning your private resort. Interesting fact: this land was purchased for about $1.1 million in August of 1998 through probate sale.
The recent uptick in buyer interest, coupled with growing consumer confidence indicates that the Westside always will be a highly desirable place to live. The bottom line: At the high end, it’s a good time to be shopping for that dream home.
Field trip
With the many properties that I have owned and my many years of experience in the real estate field, I have come to love beautiful homes and quality construction. Even when I am on vacation, my favorite pastime is to look at high end homes.
I was in New York in September and had the lovely experience of visiting one of Manhattan’s most legendary buildings, the Plaza Hotel. The Plaza, which has had many distinguished guests in its 100+ year history (even The Beatles), closed in 2005 to undergo a major renovation that resulted in hotel and condominium accommodations. The highest priced residence condominium sold for over $50 million.
Mainly due to last October’s stock market crash, many property owners in Manhattan have had to sell or lease out their vacation homes in the Plaza. Both the sales prices and the rental prices have been taking at least a 20% hit from a couple years ago. One of my favorite units is located on the 14th Floor: a one bedroom of about 1200 sq. ft., with expansive views of Central Park, listing at $6,750,000. If it is for rent, the price will be about $12,000 per month. Another unit on the 4th Floor, a 2 bedroom facing the Apple Store on Fifth Ave., is selling for $8.5 million, although I was informed that it could be negotiated to $5-6 million. This storied building is equipped with all the luxury amenities, and includes walking proximity to Central Park and 5th Avenue shopping and entertainment.
For the high end condo with the best view—among all the people I talked to in New York—the award goes to:
The Luxury Condominiums at the Mandarin Oriental, located in Manhattan’s Time Warner Center.
The hotel group consists of 248 guestrooms / suites, and provides services for its 64 ultra luxury residents, all of which have views of Central Park, the Hudson River and the New York City skyline.
The average price per square foot of a Mandarin condo is $2,800, about quadruple the Manhattan average. There are 66 residences in all, which start at $3.6 million, on the "low end," a 1,100-square-foot apartment went for a stunning $4.6 million. On the “high end”, the penthouse unit went for $63 million (for about 16,000 sq.ft) selling for almost $4,000 per square foot.
So what exactly do you get for your $2,800 to $4,000 per square foot? A few highlights:
- It's a lifestyle choice. You can call ahead and have the fridge stocked from Whole Foods, have your bed turned down and have chilled champagne waiting for you.
- It's private living, with the option of room service, or somebody who can find you Broadway tickets. In addition, there's the French/Japanese restaurant Asiate, and the hotel staff can cater a party in your apartment.
- If you want to branch out, there are all the shops and restaurants within the Time Warner Center, which will include a Whole Foods market, Equinox gym, and a new restaurant by French Laundry chef Thomas Keller.
- Each floor is accessed by private elevator, with a fingerprint touch pad, and the apartments are so high-tech that residents could use a room as a recording studio or have teleconferences from their bed.
posted by Bob West @ 4:00 PM
