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.