Mid-Summer Musings on Valmonte Real Estate

Market climate – Valmonte

  • There are currently 16 homes on the market, approximately double the amount year-over-year, and near the highest level in the current market cycle
  • The absorption rate is 4.7 months, and nearing the peak of 6.4 months supply in October 2014  
  • Prices on a square foot basis are near record highs ($734/ft)
  • Days on Market for the last quarter are at record lows (41 days)
  • On an annual basis, median sales prices have leveled off in Valmonte ($1.5m)  
  • Homes in Valmonte are selling generally within 1% of the list price

Lot’s of inventory, price drops on the way?

After 5 years of appreciation, the market is showing signs of leveling as the market transitions from a seller’s market to a buyer’s market.  The increasing supply is indicative of a “me too” selling climate where sellers are trying to take advantage of higher prices while the good times are around.  If the inventory levels hold, I expect prices to decline slightly into the Fall and Winter months when buyer activity tends to dip.  On the buyer front, interest rates remain stable around 4%, but the consensus is that rates will rise slightly over the next 6-18 months.

How does Valmonte compare to the rest of PVE?

Valmonte is a micro market compared to the larger Palos Verdes Estates market and for the most part, the trends lines parallel one another across the board.  The exception is prices on a per foot basis tend to be higher in Valmonte  than that of the entire city, due mostly to the smaller homes and generally tighter supply.

 

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