MONTEREY PENINSULA
A Slow and Steady Summer
3Q 2024 | Market Update
The real estate market across the Monterey Peninsula began to shift this quarter as sales held a slow and steady pace with buyers finally able to see more inventory in their search, just in time as interest rates began to drop. There were 156 sales this quarter across Pebble Beach (23), Carmel (38), Pacific Grove (45), Monterey (31), Carmel Highlands (5), the Preserve (5), Quail Lodge/Meadows (1), Tehama (2), Monterra (3) and Carmel Valley Ranch (3). We’re pretty much on track to match last year, which had 577 deals, but that is historically low for this area as we usually see just over 800 deals per year. Much of this is due to the fact that so many people moved here over 2020-2021 that it has taken a while for the market to bring back new inventory.
We’ve seen buyers get fussier this year and start pushing back on pricing, which has brought down median sales prices a notch to $1.81M (compared to $1.85M last year). This is the first dip in prices we’ve seen since 2008. While not a significant drop, it is good to see that the market is overall holding the price appreciation we saw come with the market surge of 2021-2022. The two price brackets that had the biggest bump in activity this quarter were the $3-4M range (23 sales this quarter, up from just 8 in 1Q) and the top of the market which had 8 sales north of $8M. The bottom of the market (below $1M) slowed this quarter from the 29 sold last quarter, to 19, which is more on-pace for this area in that price bracket.
With the increased inventory, we’re starting to see sellers come off their original list prices to accommodate buyers that bring an offer. Days on market stretched back up to 54 days this quarter and sellers pulled 3% off the list price to get the deal done. We do anticipate more buyers to come off the sidelines as rates fall and inventory levels rise, so it will be increasingly important to make thoughtful negotiations on both sides over the next few quarters.
The biggest news in real estate is the de-coupling of buyer agent commissions from the listing process. Starting on August 17th, all buyers must now sign an agreement with an agent, akin to a listing agreement, in order to see a house. These agreements can either be property specific or for a specified period of time, and do include the agreed upon agent compensation. Sellers should be ready to receive a request for payment of compensation to the buyer’s broker with an offer, either through a seller concession or price reduction. So far, the market has been open to receiving these requests and Sellers are paying for them as part of fair offers.
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Quarterly Sales by Region
Median Sales Price ($M)
Historic Sales Averages by Price Range
3Q Region Overview
“Median prices eased this quarter to $3.7M with very little inventory in the Golden Rectangle and Carmel Point to help lift medians up. The summer is typically our key selling season but was slow this quarter with just $141M going into 38 deals, down from $197M into 50 deals last year.”
“With 23 sales in 3Q, Pebble Beach’s market carried its 2Q momentum – with value-driven or trophy buys leading the way. The most notable sale this quarter took place on the highly coveted 18th hole of Pebble Beach Golf Course where a $45M property sold off-market. This record sale has raised the benchmark for Pebble’s high-end luxury market heading into 2025.”
3Q Region Overview
“With 5 sales in 3Q, the Highlands marketplace kept pace with 2Q, but did not post any oceanfront sales despite an abundance of quality inventory along the Highlands’ coastline. On the demand side, we’ve seen a rise in buyers migrating from Southern California this year and we anticipate that trend to continue into 2025.”
$19.76 m
5
Quail Lodge / Meadows
“Demand slowed considerably in the Valley as we saw just one sale at 7062 Valley Greens Circle go for $2.369M and one new escrow in Quail Meadows after dropping their list price from $10.5M to $8.995M, which is much closer to what the market was looking for up there. Historically, 4Q and the beginning of 1Q have been strong in the Quail area, so we anticipate demand picking up soon.”
3Q Region Overview
“ The Preserve has seen significant sales activity in finished homes with median prices rising and days on market shrinking as land sales trickle in. With 10 homes and 43 lots on the market, Buyers have an array of options to choose from.”
Carmel Valley Ranch
“Momentum slowed this quarter with 3 home sales, vs. 5 sales last quarter, but on par with 3Q 23 sales. Average days on market increased to 146, indicating that Buyers are price sensitive and likely holding out for the anticipated drop in interest rates. Median sales price remains right under $2M both QoQ and YoY revealing prices are holding steady.”
3Q Region Overview
“ Teháma has seen an increase in sales activity with two homes currently listed for sale, and one sale closing escrow this quarter. There are 12 lots listed for sale with an “off market” developer lot sale that closed this quarter escrow as well.”
“ Monterra has been experiencing a surge in home sales this quarter with three homes selling after a relatively short time on the market. Land sales have been quiet this quarter – there are currently 9 lots on the market, and no closed sale transactions.”
3Q Region Overview
“The New Monterey neighborhood averaged 40 days on market for single family homes in the 3Q 24 and has had an increase in Median sales price by nearly $90,000 compared to 3Q 23. It will be interesting to analyze the data to see if there’s an increase in home sales in New Monterey during the 4th quarter of 2024, similar to the trend observed in 2023.”
“With a dozen home sales in 3Q, homes in the Monte Vista and Peter’s Gate neighborhoods continue to be a hot commodity.
Most notably, the median sales price in Monterey remains steady YoY, signaling pricing stability amidst the current market shifts.”
Spiro Pettas
3Q Region Overview
“For 3Q 24, Pacific Grove home sales showed promising growth, with sold units up 41% compared to the previous quarter. Total sales volume rose by 38%, reflecting a strong rebound in market activity. The average days on market decreased by 3% from last quarter but remains up 85% year-over-year. The median sales price for 3Q 24 was $1,495,000, down from $1,664,483 in 3Q 23, indicating a shift in pricing dynamics despite increased buyer activity. This decline in median price is partly due to buyers opting for smaller homes with lower list prices.”
Pacific Grove
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