The South Bay Has Two Housing Markets
Most People Only See One
Nationally, existing-home sales fell 3.6% in March. [1] The median sale price hit a record $408,800 for the month, but volume is declining and first-time buyers have dropped to just 21% of all purchases — the lowest share since NAR began tracking in 1981. [2] Mortgage rates eased to 6.30% last week, but the relief is marginal. [3] The national narrative is clear: the housing market is stuck between high prices and hesitant buyers.
In the South Bay, 68 homes closed in the first 20 days of April alone. [4] Single-family homes in South Redondo Beach sold at 102.5% of asking price — above asking — with a median of just 8 days on market. [4] Manhattan Beach SFRs closed at 100% of asking in a median of 7 days. [4]
But here is what most people miss: those numbers describe only half of the South Bay market. The other half — condos and townhomes — is telling a very different story. And the gap between the two is widening fast.
Two Markets, One Zip Code
The Altos Research Market Action Index measures the relative strength of buyer demand versus seller supply on a 0-to-100 scale. Anything above 30 favors sellers. Above 50 is a strong seller’s market. Below 30 favors buyers. [5]
Here is what the MAI looks like across the four South Bay cities I track, as of April 20, 2026 — broken out by property type:
Source: Altos Research, April 20, 2026 [5]
Every SFR market in the South Bay is in seller’s territory — ranging from 47 to 57 on the MAI. The condo markets range from 35 to 45. In South Redondo Beach, the gap between the two is 22 points. That is the difference between a market where sellers control the terms and a market that is one or two bad months from tipping into buyer’s territory.
This is not a minor statistical curiosity. It is a structural divergence that affects pricing strategy, negotiating leverage, and timing for every buyer and seller in these four cities.
The Divergence Is Accelerating
What makes this data particularly striking is how fast the gap is moving. I track the Altos MAI weekly, and the week-over-week shifts in the SFR-condo spread have been dramatic.
Source: Altos Research, week-over-week comparison [5]
South Redondo is the headline. One week ago, it had the smallest SFR-condo gap in the South Bay at 7 points. Today, it has the largest at 22 points. The SFR market gained 4 points while the condo market dropped 11 — the single largest weekly MAI decline in any of the eight markets I monitor. South Redondo condos went from the strongest condo market in the South Bay to the weakest in seven days.
North Redondo moved in the opposite direction. Its SFR market cooled 7 points — from 60, the hottest in the South Bay, down to 53 — while its condo market surged 7 points. The gap collapsed from 22 to 8. The two property types are converging, but not because both are strengthening. The SFR side is cooling while the condo side is heating up.
Manhattan Beach is the most stable story: SFR held flat at 47 while condos climbed from 42 to 45. The gap is now just 2 points — the closest to convergence of any city. But the reason is worth noting: Manhattan Beach has only 8 active condo listings and zero new condo listings entered the market in the first 20 days of April. [4] That is not a strong condo market. That is a market so thin that a handful of transactions can move the index.
What the Transaction Data Shows
The Altos MAI captures market momentum. The CRMLS transaction data captures what actually happened. Here is the April 1-20 picture from the MLS:
Closed Sales
Source: CRMLS, April 1-20, 2026 [4]
Three numbers tell the story.
41 vs. 27. Single-family homes outsold condos by a 60/40 margin across the four cities — despite condos having more active inventory. There are 113 active condo listings in the South Bay right now versus 90 SFR listings. [4] Condos have 26% more supply and 34% fewer sales. The absorption rate is telling you where demand is concentrated.
102.5%. South Redondo SFR is the only market in the South Bay where homes are selling above asking price. The median close price of $1,640,000 exceeded the median list price of $1,599,000. [4] In a market where the national conversation is about price cuts and buyer leverage, South Redondo houses are generating bidding wars.
98.5% to 98.6%. Manhattan Beach and North Redondo condos are closing below asking — at 98.5% and 98.6% SP/LP, respectively. [4] These are not dramatic discounts, but they represent a fundamentally different negotiating dynamic than the SFR market. Condo buyers have room to negotiate. SFR buyers, in most of these cities, do not.
The Inventory Picture
Source: CRMLS, current snapshot as of April 20, 2026 [4]
The inventory imbalance is sharpest in the Redondo markets. South Redondo has 12 active SFR listings and 48 active condo listings — a 4-to-1 ratio. North Redondo has 19 SFRs and 41 condos — roughly 2-to-1. In Manhattan Beach, the ratio inverts: 47 SFRs to just 8 condos, which explains why the MB condo MAI is climbing despite the broader condo softness elsewhere.
The condo inventory is building. The SFR inventory is being absorbed. And the gap between the two is the clearest signal of where the South Bay market is actually headed.
Why the Split Exists
The SFR-condo divergence is not random. It is driven by three forces that are operating simultaneously.
Rate sensitivity hits condos harder. Condos and townhomes in the South Bay are generally priced between $700,000 and $1.7 million — the range where mortgage rate changes have the most impact on monthly payments. A buyer financing $1.2 million at 6.30% pays roughly $7,450 per month in principal and interest. At 5.30% — a rate many buyers were hoping for by now — that same payment drops to $6,640. The $810 monthly difference is enough to push marginal buyers to the sidelines. SFR buyers in Manhattan Beach and Hermosa Beach, by contrast, are more likely to be cash buyers or equity-rich move-up buyers who are less sensitive to rate fluctuations. NAR’s latest data confirms this: baby boomers now account for 42% of all home buyers, and their decisions are driven by equity, not monthly payment calculations. [2]
The lifestyle premium widened after COVID. The pandemic permanently shifted preferences toward private outdoor space, home offices, and separation from shared walls. That preference boost for single-family homes has not reversed — and in a coastal market where SFR supply is structurally capped by geography, the demand premium translates directly into pricing power. Condos compete not only with other condos but with the persistent question of whether the buyer should stretch for a house instead.
Condo inventory is replenishing faster. New condo and townhome listings are entering the market at a higher rate than SFR listings. In the first 20 days of April, 18 new condo listings appeared across the four cities versus 27 new SFR listings. [4] But relative to the existing inventory base, the condo additions represent a larger proportional increase — and in South Redondo, where 48 condos are sitting active against only 8 sales in 20 days, the months-of-inventory calculation is approaching 4.0 months. [4] That is balanced-market territory. The SFR months of inventory in South Redondo, by contrast, is approximately 1.1 months — deep seller’s market.
What This Means for You
If you own a single-family home in the South Bay: The data confirms that SFR remains the strongest asset class in these four cities. Every SFR market is in seller’s territory, and three of the four cities are posting SP/LP ratios at or above 100%. But the MAI trends are not uniformly positive — Manhattan Beach SFR has been flat at 47 for two consecutive weeks, and North Redondo dropped 7 points in a single week. The market is still strong, but it is not accelerating. If you are considering selling, the current conditions are favorable. Waiting for “better” conditions assumes the trajectory is upward, and the data does not guarantee that.
If you own a condo or townhome: The picture is more nuanced. Manhattan Beach condos are in a scarcity-driven micro-market — 8 active listings, zero new listings in 20 days — and the MAI is climbing. If you own a condo in Manhattan Beach, your position is strong. In Hermosa Beach and South Redondo, the condo MAI is declining and inventory is building. If you are thinking about selling, the window is narrowing, not widening. Pricing accurately from day one is critical — the SP/LP data shows that condo buyers are negotiating, and overpricing in a softening segment will cost you time and money.
If you are a buyer looking at SFRs: Expect competition. The 7-to-13-day median days on market for closed SFR sales means you need to be pre-approved, decisive, and prepared to move quickly. South Redondo SFR is the most competitive market right now at 102.5% SP/LP — if you are making offers there, plan to come in at or above asking. North Redondo SFR has cooled from its peak, which may create a brief window of slightly less competition, but it remains firmly in seller’s territory at MAI 53.
If you are a buyer looking at condos: This is where the opportunity is. South Redondo condos at MAI 35 and Hermosa Beach condos at MAI 37 are the softest markets in the South Bay. With 48 active listings in South Redondo and 16 in Hermosa Beach, you have selection. The SP/LP ratios below 100% confirm that sellers are accepting offers below asking. If you have been waiting for leverage, the condo segment is offering it — particularly in the $1.0M to $1.5M range in South Redondo and the $1.5M to $2.1M range in Hermosa Beach. But do not confuse “softer” with “weak.” These are still seller-leaning markets. The leverage is relative, not absolute.
The Bigger Picture
The national housing conversation treats “the market” as a single entity. It is not. NAR’s own deputy chief economist, Jessica Lautz, put it plainly this month: “The housing market remains sharply divided between homeowners with equity and first-time buyers trying to break in.” [2]
That division plays out differently in every market. In the South Bay, it manifests as a split between property types — between single-family homes that are absorbing inventory faster than it can be listed, and condos that are accumulating supply while demand softens. The same zip code contains two fundamentally different markets, and the strategy that works in one will fail in the other.
If you are making a real estate decision in Manhattan Beach, Hermosa Beach, North Redondo, or South Redondo right now, the most important question is not “How is the market?” It is “Which market?”
The answer changes everything.
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Gary Senser is a residential real estate strategist with Botello & Senser at ESTATE PROPERTIES, specializing in Manhattan Beach, Hermosa Beach, and Redondo Beach. For questions or a confidential market consultation, reach him at 310-383-2779.
DRE #01903493
Sources
[1]: National Association of REALTORS®. Existing-home sales data, March 2026. https://www.facebook.com/NARdotRealtor/posts/1398589762314992
[2]: National Association of REALTORS®. “Equity-Rich Buyers, Sellers Are Driving Today’s Housing Market.” April 15, 2026. https://www.nar.realtor/magazine/real-estate-news/equity-rich-buyers-sellers-are-driving-todays-housing-market
[3]: Freddie Mac. Primary Mortgage Market Survey, week ending April 16, 2026. 30-year fixed rate: 6.30%.
[4]: CRMLS data for Manhattan Beach, Hermosa Beach, North Redondo Beach (90278), and South Redondo Beach (90277). April 1-20, 2026.
[5]: Altos Research. Market reports for Manhattan Beach, Hermosa Beach, North Redondo Beach, and South Redondo Beach. April 20, 2026. https://altosresearch.com