Condo Values Dip in 2019

CONDO SALES 2011 - 2019.jpg

The Malibu condo market was far less impacted by the Woolsey Fire of November 2018, obviously, than single-family homes. While condos were not left totally unscarred—about 20 units were affected at the Malibu Gardens, Tapia and the Malibu Bay Club—the percentage of units rendered lost was a fraction of the single family residence tally.

Curiously, however, the condo market followed up last year with a worse showing than homes, flipping the results of 2018. That year, condo values bumped up while homes drifted downward.  

Going into 2020, both the home and condo prices were about where they were at the end of 2017.

Seventy units of condominiums sold last year, as indicated in the adjacent chart. That was the fewest of the past eight years. With overall activity extremely poor with single-family homes last year, however, 70 transactions was nevertheless respectable. 

Less respectable was the price decline felt throughout Malibu. The condo median sale price was $1,020,000. That was a drop of almost 20 percent and even below the 2017 results.

There were two leading indicators that 2019 was unmistakably poorer than 2018:

• In 2018, no condos in Malibu had sold for under $600,000 at all; last year, there were five.

• In 2018, nine units sold for more than $2.5 million (typically on the beach or very close); last year, there were only five. 

The home and condo markets find themselves almost exactly where they were three years ago. (Any time a buyer can find prices currently that are the same as three years ago in Malibu, that is a rare sign that buying timing may be good. A million times, prospects have fretted that they wished they “bought three years ago,” when prices have been typically lower and they had missed out). The separate markets took two different tracks to get here. Home values tilted down in 2018 and bounced up in 2019. Condo values got their bounce in 2018 and gave it back last year.

Looking at specific benchmark condo associations, some were able to claim some positive news:  

• The Malibu Villas near Paradise Cove are often representative of the overall Malibu market. In 2018, only four units sold for an average just under $800,000. Seven units sold last year, ticking up a tiny amount to just over $800,000.

• The nearby Pointe of Malibu had five deals each year, but last year the average was about $1.3 million compared to $1.2 million the year before.

• Malibu Canyon Village, with 104 units on Civic Center Way, had no transactions during 2018. Last year squeezed out four deals that averaged just less than $600,000, noticeably below the 2017 average.

• The Malibu Outrigger on Carbon Beach followed up an empty year in 2018 with five beachfront exchanges in 2019, the most sales in one year since 2005.

• The Zuma Bay Villas went from five sales to three, year to year.  Meanwhile, the Vista Pacifica complex at Lunita went from fives sales to one.

• The average sale price dropped about 15 percent from nearly $1.5 million to $1,263,000. Again, the higher-priced, more exclusive units in town brought in fewer buyers. Malibu had seen volume for condo sales topping $100,000,000 in three out of four years, but that did not happen last year.

Rick Wallace, who recently joined Sotheby’s International Realty, has been a Realtor in Malibu for 32 years and a contributing real estate columnist for 26 years.