DIGS is the premiere luxury real estate lifestyle magazine serving the most affluent neighborhoods in the South Bay and Westside of Los Angeles, California.
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THE SOUTH BAY DIDN'T GET MUCH BIGGER. To understand why I think this next chapter matters, it helps to look at what happened after the last big shifts. IT GOT A LOT MORE VALUABLE. THEN & NOW 1983 2026 MANHATTAN BEACH POPULATION MANHATTAN BEACH MEDIAN HOME VALUE 30-YEAR MORTGAGE RATE Sources: U.S. Census, Zillow, Freddie Mac. Figures are approximate. ~32,000 ~33,000 $300,000 $3.5M ~12.2% ~6.5% WHAT'S DRIVING DEMAND Displaced families Athletes Entrepreneurs SpaceX wealth Limited inventory In the late 1980s and early 1990s, the South Bay took a real hit. Then, around the middle of the 1990s, things started to recover. For years, a large percentage of new construction in Manhattan Beach came from spec builders. A homeowner building for them- selves makes decisions differently. A house that might have fit one construction budget can suddenly cost hundreds of thousands of dol- lars more — sometimes a lot more — because the owner keeps choos- ing what they love instead of what makes the project pencil as a busi- ness. And those choices don't only affect that one house. The next buyer walks in and says, "I want that." What was once an upgrade becomes the expectation. That helped raise the standard of the housing stock throughout Manhattan Beach and the Beach Cities. Now look at the market we are in today. The South Bay has held up better than many people expected because there continues to be demand for a very limited amount of housing. And lately, some of that demand has come from places nobody could have predicted. The Palisades fire is a good exam- ple. Families were suddenly displaced and needed somewhere to go. Some found the South Bay. What started as an emergency introduced a new group of families to the Beach Cities, and some of them discovered they liked living here. That matters because this isn't a market where we can suddenly add thousands of single-family homes. The land is already developed. Then add professional athletes. I've worked with athletes for more than 30 years through SportStar Relocation, and I've seen what mat- ters to them: privacy, security, con- venience, speed, quality and resale. Then you have entrepreneurs and business owners. I run into people all the time who have built a company for 10 or 20 years and suddenly have a major liquidity event. And now we have SpaceX. Thousands of current and former SpaceX employees have benefited from equity in the company. Not all of them will buy South Bay real estate. They don't all need to buy here for it to matter. That is the point. In a huge market, another 50 buyers may mean almost nothing. In a small market like Manhattan Beach, if 20, 50 or 100 additional financially strong buyers are com- peting for a limited number of very good homes, that can change the market. Especially when those buyers are looking for many of the same things. A view. New construction. A larger lot. A pool. Walkability. Privacy. A particular neighborhood. A certain school area. There may not be ten choices. There may be one. And sometimes the best house isn't publicly for sale. That is another part of this market people from outside the area don't always understand. Some properties trade quietly. Others become avail- able through relationships before they ever reach the broader market. Terms matter. Timing matters. Certainty matters. Knowing what the seller actually cares about mat- ters. For a buyer who suddenly has sig- nificant financial capacity, that cre- ates an interesting change. Their biggest limitation may no longer be money. It may be inventory. That is why I keep coming back to the same question: What happens when more wealth keeps arriving in a place that has very little ability to create more of what people want? I am not saying prices only go up. They don't. There are periods when values flat- ten or decline, and anyone buying high-end real estate with a one-, two- or three-year time horizon needs to understand that there is risk. You can absolutely lose money if you are forced to sell at the wrong time. But over longer periods, the South Bay has continued to prove why people want to be here. The ocean is still here. The climate is still here. The schools are still a major draw. And despite all the growth in wealth and demand, the amount of land hasn't changed. That combination is why I think the South Bay remains unusually well positioned. I've watched this place change sev- eral times since 1983. Now SpaceX may be helping start the next one. I don't know exactly how much it will change prices, and I don't think anybody does. But I do think we are watching another shift in who has the abil- ity to compete for some of the most desirable and limited real estate in Southern California. That is the story I'll be watching. Welcome to Rocket Bay. The story continues on the blog. Scan the QR code to read the full article. I think we're watching the next chapter. Welcome to Rocket Bay. I think we're watching the next chapter. Welcome to Rocket Bay. SAME OCEAN. STRONGER COMMUNITY. NEXT CHAPTER. SAME OCEAN. STRONGER COMMUNITY. NEXT CHAPTER. READ THE FULL BLOG