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Hermosa Beach Strand Home Prices Making a Comeback

Hermosa Beach Strand homes are back.

The small beach city is not only gearing-up for a busy reopening summer post-COVID-19, but it looks like coveted Strand real estate has made an amazing comeback after some very ugly numbers seen in 2019 before the Coronavirus pandemic.

In my last Hermosa Strand blog post back in July of 2019, I explain how the market was soft and prices were falling. It was a very tough time for Strand sellers two years ago.

Today, the market has done a complete 180.

For reference, this is my awfully long post titled: “Home Prices on the Hermosa Beach Strand are Getting Crushed” if you feel like freshening up on past market updates.

This time around, I am working on being more concise and will break down the action between the southern and northern ends of the Strand.

South End of the Hermosa Strand

The poster child for the anemic Hermosa Strand marketplace back in 2019 was 60 The Strand.

This spec home sale began its listing journey above $10 million and after a brutal listing period, ultimately closed for $7.6 million and change. That sale marked the market low point and since then the Hermosa Strand has come back to life.

The seller on this spec sale above held out for an extended period to salvage their resale price. Although poorly executed on quality compared to 60 The Strand, the home did offer about 1,000 square feet of additional living space.

Thanks to the listing agent forgoing a commission, this property was able to sell for $8.2 million in July of 2020 and steer prices higher on the south end to begin some positive momentum.

Presently in 2021, we sit in an extremely strong post-COVID-19 real estate market.

With the strong momentum of the sale above, a home just a few doors down and of similar size came to market at the end of the year.

This spec home offered the same square footage as the $8.2 million sale but came out boldly asking $9.99 million.

In about 90 days, they made a deal.

It is still in escrow, but if it closes anywhere near its asking price, that represents close to a 20% jump in the far south end. Albeit the home is higher quality, but to see a strong leap in price here is extremely bullish for the southern part of the Strand as the market was in the doldrums just two years ago.

If the current listing at 732 The Strand asking $8.989 million can make a deal soon as a 2008-build, that will solidify the market as a seller’s market…and a trend higher firmly intact.

North End of the Hermosa Strand

Much of the strength to the south can be attributed to some incredibly big sales completed on the north end of the Hermosa Strand.

There has been some major volume and velocity in eight figure sales.

Let’s start with the third highest sale ever, on The Strand.

This 2007-built home had failed to sell six different times since 2012. It’s asking price at times bordered insanity, not once, but twice, calling for over $20 million.

To end 2020, it finally closed at $14.25 million.

Adding to the incredible north end strength was massive 4,400 square foot lot and 4,000 square foot architectural gem.

This property, another impressive eight figure sale at just under $3,000 a square foot, affords the buyer many options. One can choose to build brand new on one of the largest, most well-located lots in Hermosa Beach, or, refresh the existing 4,000 square foot charmer for immediate use (and keep as covered land play in the future).

And, lastly, there is an undersized spec sale that landed a premium price…

This exquisitely executed new construction came to market in September 2020 at $12 million and held its ground with only a small $105,000 price reduction that ultimately yielded an accepted offer in February of 2021. It closed this month for $11.57 million.

The smaller footprint fetched over $3,000 a square foot which is a record price per square foot of any home built after 2000 on Hermosa Beach Strand. Ultra-high-end finishes and a successful spec sale sets a bullish tone on the north end.

Conclusion

Hermosa Beach Strand prices hit a peak in 2016 and 2017, and really swooned from 2018 to the beginning of the pandemic in 2020.

Buyers during that 2016/2017 market correction were able to land some amazing deals.

Today, we are back to a sellers’ market on The Strand. Big jumps in prices, strong demand/volume, and records being set on price per square feet and multiple eight figure sales.

The Strand is about as speculative of a market as there is and it can move up or down sharply on a single sale alone. My bet is with low interest rates and the economy reopening, prime Strand real estate will continue to have its day in the sun through 2021 and perhaps beyond.

Have a great weekend.

DRE: 01779425

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