Sixteen single-family homes and condominiums have sold and closed escrow in the Malibu area (everything in the 90265 ZIP code) in July. This is down from 26 in June. Thirteen of the homes sold this month were listed as standard sales, one was an REO/bank-owned property and two were reported as short sales. Twenty-one of the closed sales were single-family homes and five were condominiums. See the attached chart for a full report of the July sales per the CLAW/MLS.

I was personally involved in the sale of a home that demonstrates a seller willing to adapt to the changing real estate atmosphere in Malibu. One of the 16 homes that closed escrow this month actually hit the market in April 2010 at a listing price of $9,950,000. It’s a classic example of following the market down as the listing history shows price reductions on a frequent basis. The list price of $5,495,000 procured four offers in a two-week period in June 2011—and the final sales price was reported at $4,100,000.

This is compelling evidence that demonstrates the importance of the listing price as the prime factor in attracting buyers. Additionally, it takes a seller’s ability to forget the formerly appraised values of their home from past years, and—more importantly—a seller’s willingness to negotiate with all buyers on all offers rather than discarding offers perceived as low-priced.

According to data from Foreclosureradar.com, there are 138 properties in the 90265 that are in the distressed categories, which is way down from earlier this year. There are 40 properties listed as pre-foreclosure, which means they have notices of defaults filed against them. Many of the property owners negotiate for loan modifications or otherwise cure these defaults.

There are 81 properties listed with auction sale dates. Many of these sales are postponed. Some of the lender-owned properties calendared for auction sales don’t happen as property owners negotiate settlements. There are 17 properties reported to be bank-owned, and thus we can expect those to be listed in the market in the coming months. 

Recently, I went to a meeting where Leslie Appleton Young, economist for the California Association of Realtors, spoke to a group of Realtors. She reported that Malibu has a 13-month supply of inventory to sell. Santa Monica has a four-month supply and Beverly Hills has a seven-month supply. A healthy market carries a six-month supply. 

Malibu has the largest supply of properties listed for sale on the Westside. If it would take 13 months to sell what is currently listed, properties continue to be listed weekly and sales are now down from last month, my conclusion is that the Malibu market is in a stage that needs adjustment.

Many owners want to sell their properties, but Appleton-Young said many sellers are nostalgic about their prices. Nothing drastic will happen in Malibu until sellers begin listing their properties based on realistic sales prices. This can be achieved by looking at properties that have sold in Malibu within the last six months. 

I have learned in business that I never achieve major results by making minor adjustments. If the Malibu real estate market is expected to make a major turn toward a healthy market, the sellers must make major adjustments in their pricing, so the entire real estate market can eventually report major results and a healthy flow of inventory will follow.

Beverly Taki is a California-licensed real estate broker who has represented clients in Malibu for 22 years. She is a Malibu resident and president/broker of Seabreeze Estates Realty. She has a certificate in dispute resolution from Pepperdine University, specializing in mediation. Taki can be reached at beverly@beverlytaki.com or 310-456-4843. Her website is beverlytaki.com.