2019 Quarterly Update: July-September
We have officially entered the Fall season and the start of Q4, which is typically one of the slowest seasons in the Malibu housing market. Once kids return to school and weather starts to cool, the demand for housing softens. In addition, there is some uncertainty surrounding the economy and where it stands in the upcoming season. We have outlined a few things to keep in mind when buying or selling this Fall.
Uncertainty in the Economy
There has been speculation about an upcoming recession and whether or not it is likely to happen. The answer is that a recession is likely to happen — but when it will happen is unclear. However, when the recession does occur, it is very unlikely to have an impact on the housing market that the 2007-2009 recession did. Thanks to tighter lending standards and new regulations, the next recession will be much less harsh.
Mortgage rates are currently at historic lows and it is encouraging buyers to purchase homes that would typically be out of their price range due to irresistible savings. With that being said, buyers may not be expecting to pay top dollar in a buyer’s market. It’s important to keep listing prices and expectations realistic and accurate.
In a softening market, it is essential to base listing prices on data-driven results and reasoning. This is how our team approaches every transaction, whether representing a buyer or a seller.
Malibu Beach Sales:
On the Malibu Beachside at the end of Q3, sales are comparatively low with a mere 25 homes sold and 5 in escrow. The average amount of days on the market was 115 with an average listing price of $12,999,532 and the average sale price at $13,002,200. These stats are somewhat skewed due to the landmark sale of Ron Meyer’s Malibu home at $100 million.
At this time last year, there were significantly more sales with 42 homes sold and 5 in escrow. The average amount of days on the market was longer at 135. For pricing, Malibu Beach had a lower average listing price at $11,396,756 and a average sale price of $8,515,345.
Malibu Landside Sales:
On the Malibu Landside, 64 homes have sold and 20 homes are in escrow at the end of Q3. The average amount of days on the market is 107 with an average listing price of $6,212,671 and an average sale price of $3,179,470.
At this time last year, sales were effectively doubled with 135 homes sold and 20 in escrow. The average days on market was lower at 102 with a lower average list price at $5,627,298 and a higher average sale price of $3,360,698.
This massive discrepancy is due in-large to the Woolsey Fire, which effectively halted the Malibu real estate market for several months. Since then, buyers have been apprehensive to buy in the hills of Malibu, which has further set back this market. With fire insurance rates skyrocketing and some properties now uninsurable, it is a difficult position for a seller.
The MGG Take:
Throughout the uncertainty in the economy, 3 things matter more now than ever for sellers:
- Price: Focus on pricing your home correctly – and in a bumpy market, pricing aggressively compared to your competition. Although setting the highest price for your home may be favorable, it may result in your home not selling. When you list with the right team, they will provide you with a Comparative Market Analysis to show similar properties in your area with comparable rooms and amenities.
- Perfection: If your home needs a cosmetic boost, it is essential to take advantage of staging, painting, and any other obvious imperfections. The tougher the market, the more important it is to avoid error. Utilizing the exclusive Compass Concierge program to stage your home at no upfront cost to you – and Compass Coming Soon which allows you to get pre-exposure for your home are simple ways to sell your home faster with fewer days on market.
- Patience: The Malibu housing market tends to have far longer average days on market than cities such as Santa Monica, Westlake Village, and other less-niche markets. However, with a slower housing market, it is essential to exercise patience as what may have sold quicker before may not be the same case now. Once again, having realistic expectations is key.
Keep these 3 tips in mind as you enter the Fall housing market. And of course, contact our team if you have any questions or would like additional tips as we transition into the Fall season.
All information is current as of September 30 (end of Q3), and pulled directly from the Multiple Listing Service. This does not include off-market transactions.
Looking to sell or buy in Malibu? Contact us for more information!
Call 310.230.5771 or email russellandtony@compass.com
