In Manhattan Beach last year, as in most years, a number of sellers of residential real estate hit home runs with some high-priced sales. Plus one couple deserves inclusion on our list of winners just for their sale's karmic comeuppance.
However, unlike recent years, there were also a few seller missteps that resulted in surprising losses in 2019.
First things first.
This magnificent property, situated on 2½ lots on a prime Sand section walkstreet, was designed by local architect Dave Watson and was constructed as a custom home in 2014.
The home boasts 6 bedrooms and 10 baths in 11,917 sqft of living space.
Its many high-end luxury amenities include a home theater, a saltwater pool with waterfall feature and cabana, a walk-in wine cellar with dry bar and an indoor virtual golf course/driving range.The owner amassed the total lot square footage of 6,751 sqft - with 75 feet of walkstreet frontage (very unusual for a Manhattan Beach walkstreet) - in two separate purchases of adjacent lots for a total purchase price of $4.3 million. Both purchases were transacted in 2009, a good time to be buying land in the beach cities.
Even if you assign a very high $500/sqft cost to the construction, you would have a $6 million build on top of the $4.3 million land cost.
This home achieved the highest price for a residential sale in Manhattan Beach in 2019 at $16 million when it closed escrow last March. Despite having started at an optimistic list price of $19,950,000 back in January, 2017, the final sale price still reflects a substantial return on a $10.3 million investment in our estimation.
828 1st Street
Local developer Matt Morris did it again in 2019, pre-selling a brand new 6,000 sqft Hill section home, pictured below, on a 53 x 125 ocean-view lot for $10.5 million before it even hit the MLS!This 5-bedroom, 7-bath home features superb detailing and finishes, not to mention amenities like a backyard pool, a basement with home theater and a wine cellar. And, lest we forget, some amazing ocean views came with the home as well.
Matt paid $3,315,000 for the dirt in 2017 but even if we estimate a nosebleed PPSF of $600, that still translates to a cost of less than $7 million for the land and the buildout combined, which means a nice profit was made to be sure.
Not bad, Matt.
The owners of the last entry in the winners category certainly did alright for themselves by selling, for $1.9 million, a 3-bedroom single family residence at 225 39th Street in El Porto, pictured above, that they purchased in 2010 (also a good year to buy real estate in the beach cities) for $1,159,000.
But for the sellers, the real reward was being able to get away from a harassing neighbor who brightly painted her duplex across the street at 216 39th Street, pictured below, in a retina-searing pink with two emojis to get back at her neighbors for having complained to the city that she was using her duplex for illegal short-term rentals (note the one emoji with the zipper for a mouth which, in emoji parlance, stands for 'Shut up').
As we recounted in a previous blog post (see The Emoji House, Good Neighbors and City Council (Part II)), the duplex-owner also decided to sell but, unlike her neighbors, she had far more difficulty finding a buyer. Her starting list price of $1,999,000 back in May eventually shrank to an asking price of $1,550,000 before a buyer was located just a few days before Christmas (as we go to print, the sale has not closed).
So while the owner of the emoji house will still probably make a tiny profit on its sale (she paid $1,250,000 plus closing costs back in 2017), I think we can see that this is an example of that old saying, "Karma's a bitch."
First off is this Nick Schaar-built home, one of the last homes he built before the real estate market and the builder's eponymous company, Schaar Homes, tanked in unison in the Great Recession.
After purchasing this brand new 4-bedroom, 2756 sqft home for $4,350,000 in June, 2008, the new owner ended up spending most of 2011-13 trying to unload it at a loss.
But when prices firmed, the seller thought she'd tack on a premium and ask $5,795,000 in 2018.
Alas, it was not to be and after a number of price reductions and a change of realtors, she eventually sold 2nd Street for $4.4 million in March of 2019 or just $50,000 above the 2008 purchase price. After closing costs (commissions alone would have cost the seller $220,000), she was heavily in the red.
Actress Zooey Deschanel purchased this brand new 6-bedroom, 6½-bath Tree section Cape Cod in 2015 for $4,569,000. At that time, she moved in with her brand new film producer husband while she was still filming the Fox tv comedy New Girl (lots of 'new' in Zooey's life at that time).
However, a few years later, she and her then-husband decamped for an American Martyrs home and subsequently listed the Elm property in June, 2018, for $5,250,000. Unfortunately, the market said 'no dice' to that price and, after numerous price reductions over the following year, the home eventually found a buyer and its sale closed in August of 2019 for $4.7 million.
Just the commissions alone on that sale would have totaled $235,000 so, as you can see, Zooey's net on the sale was well below her original purchase price just 4 years prior.
Sometimes, it's not easy being the 'New Girl' in town.
There's clearly a back story with this property but we're not sure what it is.
Suffice it to say, Michael Greenberg, president of shoe company Skechers, purchased this brand new 5-bedroom home across from Robinson elementary, billed as a 'modern brownstone', from the developer, Balios Capital, in March, 2018, for $5,650,000.
Two months later and it's back on the market for $6 million. However, it took well into 2019 and a half mil price drop to eventually resell Morningside. Resale price - $5,499,000 or $151,000 below the purchase price the previous year.
After factoring in closing costs and commissions (at 5%, commissions alone would have been $275,000), the total loss on the sale could be as much as $450,000 or so.
So there you have it, the good, the bad and, in the case of the emoji house, the ugly for 2019 here in Manhattan Beach.