Hollywood Riviera & South Bay Real Estate Blog

We work for Sandra Sanders who is the broker/owner of Re/Max Palos Verdes Realty & Re/Max Execs.  We truly respect her and love how she runs her business.  One of the reasons is because this is the type of message she likes to put out to her agents.  This was part of our “What’s New at Re/Max Palos Verdes/Execs” newsletter this spring.  She sends this out quarterly.  I really liked her “Message from Sandra” this quarter and would like to share it!

“Years ago, a 10 year old boy went to the soda shop and asked the waitress, “What does an ice cream sundae cost?”
“Fifty Cents,” the waitress replied.

The little boy reached into his pocket and carefully counted his change as the waitress became more and more impatient.  She had “bigger” customers to wait on.

“How much for just plain ice cream?” the boy asked.  The waitress noticeably irritated, said “Thirty five cents.”  Again the boy slowly counted his money and then asked for a dish of plain ice cream and paid the correct amount.

Later, the waitress cleared the boy’s dish and there on the counter he had left two nickels and five pennies.  She realized that he had had enough money for the sundae, but had sacrificed so that he could leave her a tip.

The moral of the story: Before passing judgment, first treat others with courtesy, dignity and respect.  

This market is changing as we speak.  Right before our eyes it is very different all of a sudden.  Spring is usually a great time to put your house on the market and I still believe it is, but don’t expect the old days’ of the last 4-5 years. 

We are still seeing multiple offers believe it or not ~ music to our seller’s ears ~ but they are not the same multiple offers of the last 5 years.  Now we are seeing “lowball multiple offers.”  And this is after only days on the market when the buyers know there are other offes.  We just had one where the buyer actually made their counter offer worse than their original offer and this was in a  multiple offer situation.  Crazy!  They did not get the house!

Pricing is all too critical now for sellers.  Staging is critical as well…having “the house on the market” that stands out from the rest and that is priced slightly under it’s competition is the key.  Pricing is not as easy to do as it was over the last 5 years.  Our number of sales are way down, so there is little sold inventory to compare to.  Even though our 2008 sold prices are seemingly 6% higher than this time same quarter 2007, one can not build that into their sales price.  I would ascertain that the 6% rise in average price for the Hollywood Riviera this year over last is due to some very high end homes selling this year and thus raising the average.  We have also seen the lowest price sale in a long time occur this year -2008- $575,000 for a fixer upper in the lower Torrance side of the Riviera.  That is lower than the last low sale of $605,000 which was an even worse location on the Pacific Coast Highway service street of the lower Torrance side of the Riviera.    We have quite a diversity of homes in our “designated-by-the-MLS” Hollywood Riviera neighborhood.  There are definitely two sides to the Riviera and two separate price ranges that go along with the different addresses. 

To date the 90277 (Redondo Beach) side of the Riviera has an average sales price of $1,375K and the 90505 (Torrance) side of the Riviera has an average sales price of $946K.  That is a $444,000 price discrepancy.  Wow - a 32% price difference. 

This is interesting here….the Redondo Beach side (90277 only) had an average price of sold homes this same period last year (Jan 1 - May 2, 2007) of $1,195K.  That means the RB side has gone up 14% year over year - same time period.  Now the number of sales has gone down from 23 last year to 11 this year…that’s more than a 50% drop.   The Torrance side had an average price this same period last year of $951K and it’s $946K this year.  They had a drop in their year over year average price of 1/2%.  Not much, but not the increase in average price the RB side had.  There were 7 houses sold in 2007 Jan - May 2nd 2007 and 9 solds for 2008.   About the same which makes their numbers a bit more in line with each other. 

Here’s the map of the Riviera with the dividing line in different colors.

Torrance Unified’s Riviera Elementary was honored by its induction into the State’s exemplary rank of being A California Distinguished School for the school year 2007-2008!  California honors some of the state’s most exemplary and inspiring public schools. Schools selected for Distinguished School Awards are strong, well-rounded community schools. This year, the selection criteria for the Distinguished School program were more stringent than ever. 

9 South Bay schools were inducted into these ranks this year - they include:

Torrance Unified - Riviera Elementary, Arnold Elementary, Towers Elementary & Edison Elementary.

Redondo Beach Unified - Jefferson & Tulita Elementary Schools.

El Segundo Unified - Center Street & Richmond Elementary

Congratulations to our terrific South Bay Elementary Schools.  Note that the middle and high schools receive the awards on alternate years.   

This is a photo taken in July 1951 on Calle de Madrid - a street at the top of the Riviera (also considered the “Upper Hollywood Riviera.̶   It’s super cool - check out the cars!  The man who took the photo was amazed at how you used to be able to see views from so many places in the Riviera before all the trees grew up!  The trees in this photo are around 3 years old…as the homes in this photo were mostly built around 1948.  I am going to post a picture of this same spot as soon as the next clear day comes around so we can compare the views then vs. now.  Love the “woody” in the background! 

There are currently 27 single family homes on the market as of today with the average Days on Market at 61.    11 of those actively listed properties have reduced their prices at least once.  The highest price is $2,295,000 for a home in a gated planned community called Riviera Beach Colony - it’s a lovely home just steps to the beach.  The lowest priced home is $650,000 on Pacific Coast Highway - the service street. 

As far as what’s in escrow currently - there are 9 homes pending sale and their average days on market was also 61.  2 of those properties reduced their price once before going under contract.  The highest price pending home is $1,999,000 for a gorgeous new construction home with an ocean view on the corner of Calle Mayor and Via Pasqual.  It’s not quite done yet and never hit the MLS as active; it just came on as pending.  The lowest price pending property is $650,000 and it’s down on Highgrove and needed some work. 

As far as what’s sold this year - 2008 - we’ve got 16 sales so far.  It’s a far cry from this time last year (2007 had 28 homes sold by now) as far as number of units sold.  This year is off by 43% for number of units sold. A lot of people are clearly “waiting it out.”  We do have the same number of actively listed homes though - but many of those have been on the market a long time….a couple for over a year!  The only good news here for 2008 so far is that the average price is actually up 8% with the average price for 2008 sales coming in at $1,228K and average price from 2007 sales (same period January 1st - April 22nd) coming in at $1,129K.   The most expensive home sold in 2008 so far was $2,425,000 and it was gorgeous with the most amazing views!!  It is one of the most expensive homes ever sold here in the Riviera, short of the homes on the Paseo de la Playa bluffs.  The least expensive home sold in 2008 was $605,000 on that same PCH service street as mentioned above. 

One area to look at as well when mentioning the Hollywood Riviera is the difference in the Torrance side (90505) and the Redondo Beach side (90277.)   See my article - “Hollywood Riviera - Where is that Anyway” for a map of the different sides.  The Torrance side’s solds in 2008 average price was $958,00 (6 units) and the Redondo Beach side’s average price was $1,390,000 (10 units.)  Big Difference here!

Stay tuned for next months update!

It’s Earth Day in Redondo Beach - Saturday, April 19th, 2008!

The Redondo Beach SEA Lab and the Redondo Beach Department of Public Works is hosting “Come Celebrate Earth Day 2008!”  The event is scheduled from 10:00 am to 3:00 pm today and is FREE!  You can trade your plastic bags in for reusable tote bags, join in on the Beach Clean Up, take an aquarium tour, watch a composting demonstration and more!  There will be live music and entertainment as well as games, and prizes!  Come celebrate Earth Day and join in our Wonderful Community!

The SEA Lab offers another way to be good to our earth and give back to the community - every 3rd Saturday of the month they work to restore the Redondo Beach Bluffs!  Volunteers of all ages and abilities are invited to help the SEA Lab restore the bluffs.  Show up at 10am at the big tent between Avenue I and Vista Del Mar.  Remember to bring a hat, sunscreen and some water.  For more information or to RSVP, call Monica at (310) 318-7411.

On October 6, 1992, Redondo Beach started offering “historical home property owners” a chance at property tax savings with its Mills Act.  The Mills Act was first enacted in California in 1972 by a state senator, James Mills.  Fortunately for all of us he recognized the importance of preserving landmark properties and offered owners of these properties a tax savings in exchange for continued preservation of the property.

There are several cities within the state of CA that also offer the Mills Act.  For Example, in Floral Park, CA (Tustin area) Sandy DeAngelis notes in her Historic Homes blog that they often look to the Mills Act for preservation of property and tax savings.

Here in Redondo Beach there are several homes that have been designated as local Landmarks!  This one is at 213 Avenue C. 
And this is at 510 Garnet. 
  This gorgeous home is located on 501 Ave B.  All these homes have their own character and uniqueness that make our local community something to cherish and preserve for later generations to enjoy!

http://www.redondobeachhistorical.org/millsact.htm

What is the difference between Contingent and Pending?  Well - technically both these descriptions refer to properties that are “in escrow.”  In Escrow refers to a property that is under contract.  Typically the first 17 days of the contract are “contingent” days - contingent on inspections of the property, review of disclosures, appraisal and financing approval, to name a few. 

So does the listing agent put the property into a “contingent” or “pending” status in the MLS?  Agents are required by their Board of Realtors to enter “active” listings into one of these categories after a contract is accepted between the buyer and seller.  Realtors actually have other choices as well - Back Up Offers, First Right of Refusal (this one is new.)  The two most common are Contingent and/or Pending.  If the contract seems pretty “solid” right off the bat there is not much of a decision - it goes into Pending.  Technically a contingent entry is still considered a property to be “available for showing” by realtors.  One good reason for a contingent status: the seller accepted a “contingent on the sale of buyers’ property” contract.  This is typically the reason to put a property into the Contingent Status.  The Board of Realtors considers the Contingent status as one that is still “active” and continues the Days on Market (DOM) Clock still counting.  Many agents don’t know this and put properties into Contingent Status for no real reason - not because they accepted a “contingent offer.”  Only the Pending status stops the DOM clock from counting!  If a property is in Contingent Status the Days Under Contract are included in the “market time.” 

This creates a problem for agents who may be checking comps for properties and using DOM as a statistic…..often if a property is entered in Contingent Status, agents never take it out of that status and the clock ticks on the entire time it’s under contract and it would then appear that is sat on the market for much longer than it really did.  Laura and I for one would like for all agents to know this is how it works and start to use the Pending status if a property is in escrow.  We all know that no one shows contingent status properties.  Maybe you occasionally get a phone call from another agent curious if the escrow is strong or now…but if they want to know they will call on and status. 

Let’s all put properties into Pending from now on unless an escrow truly is contingent on the sale of a buyer’s property.  (Especially when this really doesn’t happen that often anyway.)  That way we can all really know how long a property was really on the market - our DOM can become more accurate that way!

We are in Oauhu this week - it’s gorgeous here.  Having a passion for real estate means we never stop thinking about it or being curious.  While walking along the path that leads around Diamond Head we sure saw some gorgeous properties….wow - what views!  These are the upper end around here!

In reading the Honolulu Advertiser - the local paper - the business section reported on April 9th that the number of units sold  is much lower than last year, but the median price is higher. This was also reiterated in the Island Real Estate Blog with data to back it up.  This is exactly what we see happening in the South Bay cities as well.  Last night at a lovely dinner at Roy’s we met a couple from Atlanta, Georgia.  It just so happened that Norrine is a realtor for Jenny Pruitt Realty.  She said they represent a higher end clientele and are also experiencing a slower pace of sales (fewer units sold) yet a higher and or stable average pricing.

It is interesting to see how the higher end neighborhoods are consistently the same across the country….and we are seeing three samples here from all “ends” of the country - Atlanta, South Bay of Los Angeles & Honolulu.

The first quarter of 2008 is already over - yikes!  Time is flying by and real estate here inventory here in the Hollywood Riviera is at a minimum.  We have only 21 single family homes and 7 condo/townhouses for sale.  Of those, many are stale listings - some even have been on the market for over a year.  Those are overpriced and not in great condition - so honestly there is very little on the market.  There were two new listings last week…a gorgeous ocean view home in great condition at 308 Via Anita listed for $1,399,000 and a cute house in the lower Riviera on Via Linda Vista  with 3 bedrooms, 2 bathrooms for $1,249,000. 

As far as “in escrow” properties - we have 12 properties (SFR, Condo,Townhouse) in escrow.  These will be our solds in the next few weeks.  One of the properties in escrow is one of the most expensive homes ever sold in this neighborhood (short of those on the Paseo de la Playa bluff that is.)  It was listed for $2,499,000 and sold for very close to that price.  It is one of the most gorgeous homes - completely rebuilt in 2006 and with the most gorgeous panoramic ocean, city, mountains and queen’s necklace views you’ve ever seen.  This will make a nice comp for all those other homes that are under construction currently.  The Hollywood Riviera is changing a bit - it is not just some sleepy 1950’s tract anymore….these homes are going custom and with a location like the Riviera - close to the beach, shopping and great schools - it’s hard to beat!

What did the first quarter 08 hold sold-wise?  There were 14 homes sold in the 1st quarter that is off the mark of 2007 when 21 homes sold in the 1st quarter.  If you’ve been keeping up with our blogs - we noted that the 1st two months of 08 were keeping up nicely with 07 numbers - well March threw that out the door.  March 07 had 10 homes close escrow….March 08 only had 3.  That is where the difference lies - 7 homes.  That’s actually a 30% difference from last year…hope the rest of 08 heats up a bit more.  With our low inventory it’s no wonder not much is selling…..there is nothing to buy.   There is a higher average price for 2008’s 1st quarter over last year’s first quarter - average sales price for 1st quarter 08 was $1,165K.   Typically, the homes that are priced well, in a good location and with good bones are selling quickly still.  Pricing is key to this as well as making sure the home shows very well…better than it’s competition.