1Q17 Market Update

ellen Weekly Blog

Market Overview 

Pebble Beach

– A slower start to 2017 for Pebble’s market as sales slowed from the previous quarter (down 1% from 4Q16) and further from the previous two 1Q’s totals (down 18%).

– Lagging new listings (73 active – 12% below seasonally adjusted averages) continue to limit activity across the board as we enter our 3rd year of historically tight inventory levels.

– Also worth noting that the top of the market remains saturated, with listings above $6M representing over 30% of the total inventory pool and just 1 sale north of that threshold in the first quarter; particularly worrisome is the glut between $8-$15M (12).

– The $3-$4M price bracket enjoyed another robust quarter with 5 sales – forecasting another stellar year in that range and on pace to challenge ‘16’s record of 20.

– The bottom of Pebble’s market (under $2M) extended its healthy pace, especially in the Upper Forest, as strong demand in 1Q pushed median sales prices to their highest level in 10 years ($937,750 and over twice
2011 levels). The balance of Pebble’s other areas didn’t fare as well this quarter as median sales prices dropped slightly – the MPCC area was down 15% and Central Pebble contracted 2%.

– Having prepared these quarterly market updates for over 25 years, through several cycles, our crystal ball is forecasting a plateau in the market – still too early to call that trend unequivocally but we’re keeping a close eye on it.


– The prime parts of Carmel started out ’17 on a good note with 50 sales in 1Q – a notable uptick from 4Q16 (up 24%) as well as the previous two 1Q’s (up an average of 15%).

– As forecasted, the Golden Rectangle led all areas with 12 sales, followed by a two- way tie (10 sales) from the Northwest and Southeast areas, showing strong market preference for walk to town.

– Both the $1M-$1.5M and $1.5-$2M price ranges maintained healthy paces in 1Q – representing nearly 60% of all activity as demand under $2M of Carmel’s market holds firm.

– Conversely, the top of Carmel’s market softened slightly with only 2 sales north of $4M: 2446 17th Ave – $9M and 5 Sand & Sea – $5.2M.

– Inventory levels echo those sales trends with the majority (70%) of active listings on the market under the $3M threshold.

– The Golden Rectangle favored sellers the most with the tightest negotiations (3% average off ask) while the Southeast area saw the largest discounting (7% average off ask) in 1Q.

Carmel Highlands

– The Carmel Highlands and Meadows had 6 closed sales in the first quarter, on target to match the 23 total sales that closed in 2016. The velocity continues to be highest below $2M, representing 5 of the 6 sales this quarter.

– We’re seeing activity slow above $6M across all of the main regions that we track but given the consistent activity in this bracket over the past 18 months, it may just be a seasonal anomaly. Stay tuned.

– For those properties that are priced appropriately, the sales are coming swiftly: average days on market was just 127 for 1Q17 sales, the fastest rate seen since 2012.

– The median sales price for the Meadows and Highlands was $1.26M and $1.46M, respectively. This is down substantially from 2016 but with 3 deals pending north of $2M, will return to historic levels.


– Quail Lodge had one closed sale this quarter: 8025 River Place which sold for $1.685M (6% off of the list price). Activity in Quail Lodge has been constricted as of late due to a lack of supply with no significant change in sight. After seeing on average 18 deals close per year over the past 4 years, it looks like we’re returning to historical levels with closer to 6 deals expected to close in 2017. There are currently two homes in escrow: 7050 Valley Greens Drive which is listed for $1.895M and 8005 River Place which is listed for $1.775M. Prices continue to climb in Quail with a median sales price of $1.685M this quarter, up from $1.21M in 2016 and $1.175M in 2015.

– Although Quail Meadows didn’t have any deals close escrow this quarter there are 2 currently pending: 5473 Quail Meadows Drive which went into escrow shortly after we pulled our 1Q17 data and 5459 Quail Meadows Drive.

– Velocity in Quail Lodge and Quail Meadows continues to outpace the rest of the Peninsula, averaging just 27 days on market this quarter, compared to 92 for downtown Carmel, 127 for the Highlands and 101 for Pebble Beach. Given the lack of supply and strong demand for showings and new sales, we anticipate this to continue to be the case throughout the next year.