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South Bay Value Areas – Recap of 2016 and 2017

We are right around the corner from kicking this June gloom and heading straight into the South Bay summer. This marine layer reminded me of a 2016 June blog titled Value Areas in the Beach Cities. In this blog I examined areas offering a ton of bang for your buck relative to nearby markets. Today, I want to re-examine those areas and share value areas for 2017.

MB Liberty Village Starter Homes

In 2016 Liberty Village offered great value relative to the other areas in the city of Manhattan Beach and was primed to continue running. Here are some of the comparables from then and now…

(2016) 2204 Manzanita fixer sells for $1,395,000

(2017) 1408 Manzanita fixer sells for $1,450,000

If you jumped on the Liberty Village fixer train then you are delighted to see a sale of $55,000 higher than what you paid.

(2016) 2201 Harkness sold as a fixer for $1,340,000

(2017) 2201 Harkness sold as a turnkey flip for $1,760,000

A super easy flip job that likely cost about $200,000 for the investor. They made this investment in an area that obviously had value, and there were plenty of eager buyers looking to get a turnkey Manhattan Beach deal at a more affordable price.

(2016) 1500 Faymont a 1,200 sq. ft. fixer sold for $1,280,000

(2017) 1608 Faymont a 1,943 sq. ft. turnkey is pending after a short listing at $1,850,000

Yes, these are two different home sizes and one is a fixer and one is turnkey condition. But…let’s be honest, if you read the blog back in 2016 and swooped on the 1,200 sq. ft. Faymont home for under $1.3 million and planned to do an update and addition, then you are easily sitting on a home worth close to $1,900,000!

Hermosa Condos at 446 Monterey Blvd

These condos on Monterey Blvd offered a great value relative to the town home and single-family home offerings in the Hermosa Sand Section (as mentioned in the previous blog). The information below will illustrate the action on the last two three-bedroom sales in 2015 to the sales after the June 2016 blog.

(2015) 446 Monterey #1-B was a three bedroom light fixer sold for $916,000
(2017) 446 Monterey #L-1 was a three bedroom light fixer sold for $1,010,000

The past value blog was written in June 2016 and these were the only two fixer activity pre- and post-blog. Hard to predict value, but the complex obviously undervalued and jumped $100,000 in a short period.

(2015) 446 Monterey #H-2 sold as a turnkey unit at $1,101,000
(2016) 446 Monterey #3-H sold as a turnkey off-market for $1,200,000
(2017) 446 Monterey #2-G sold as a turnkey unit at $1,153,000

Again, another $100,000 jump right after the blog posted as there was value in this building. There was a slight dip in price on the 2017 sale, however, the unit is likely not as nice as 3-H but a good buy nonetheless that may continue to do well over time.

Specific Parts of “El Nido” Area in Redondo Beach

Lastly, I want to recap the El Nido area of Redondo Beach, more specifically the “elbow” of 190th and Inglewood Avenue with the opposite elbow borders of Pruitt Drive to the west and 182nd to the north. Last year, three-bedroom homes under 1,000 sq. ft. sold between $670,000 and $725,000. Now,  sub-1,000 sq. ft. two-bedroom homes are selling between $725,000 and $770,000 in the month of June.

(2016) 2616 Armour Lane 900 sq. ft. THREE-bedroom sells for $670,000
(2016) 2611 Ralston Lane 810 sq. ft. THREE-bedroom sells for $724,000

(2017) 2503 184th Street 744 sq. ft. TWO-bedroom sells for $725,000
(2017) 2617 184th Street 975 sq. ft. TWO-bedroom sells for $770,000

It may not look significant, but homes in that price range with a third bedroom make a big difference. The fact that a year later, two-bedroom homes are selling higher than three-bedroom homes is a massive surge. Not to mention, there have now been bigger homes in the area commanding between $1.2 million and $1.4 million…the secret is getting out on El Nido and buyers are taking advantage of the affordability.

Conclusion

Looking back on our old blog post the value areas did quite well. The recommendations were not “get rich quick” advice, just solid conservative value investing into communities that were affordable relative to the nearby markets. Buying a property “right” as a value play, and then getting an immediate 5% to 10% increase in a year is huge for home buyers…especially first time buyers with low down payments looking to refinance into a better rate.

Since this 2016 blog recap turned into a bit of a novel, we will have part two on my new 2017 value areas next week! Hopefully I can give out some good advice that puts a smile on your face in 2018.

 

 

 

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