"Luxury markets do tend to have a somewhat elevated degree of sales that occur off-market," Dave Fratello, the Manhattan Beach broker behind a widely followed local data blog, told MB News earlier this month. It reads like a mild aside. The number behind it is not mild at all.
In the first half of 2026, roughly one in five Manhattan Beach home sales closed without ever touching the open market. That is the highest share for a January-to-June period in the data set's history, and it sits well above every other South Bay city in the same analysis. If you have spent this year refreshing portal alerts for a Tree Section rebuild or a Hill Section view lot, that gap is not a rounding error. It is a fifth of the competition you never saw, and in some cases, a fifth of the homes you might have wanted to see at all.
The number that doesn't show up in your search alerts
The method behind that figure is simple. When a closed sale posts to the MLS showing zero days on market, the deal was arranged before the property was ever publicly searchable. Using that test, MB News reported that Manhattan Beach's off-market share for the first six months of 2026 reached its highest point on record, and that for the full year of 2025, the city ran at 15 percent off-market compared with a fraction of that elsewhere in the South Bay.
Set side by side, the contrast is stark:
- Manhattan Beach: 15 percent off-market for full-year 2025, climbing toward one in five sales in the first half of 2026
- Redondo Beach: 5 percent
- Torrance: 4 percent
- Palos Verdes: 3 percent
No other South Bay city comes close. That is not a coincidence of geography. It is a byproduct of what Manhattan Beach has become: a market small enough that everyone in it, buyers, sellers, and brokers, knows who else is looking, and valuable enough that many sellers would rather arrange a quiet deal than run a public campaign.
Meanwhile, the visible market looks orderly. Redfin's data through May 2026 puts the Manhattan Beach median sale price at $3.7 million, up 21.9 percent year over year, with homes closing in a median of 28 days and a competitiveness score of 79 out of 100. Those numbers read like a transparent, fast-moving market. They are, but only for the roughly four out of five homes that ever reach a public listing. The efficiency you see is real. It is also incomplete.
Why so many sellers here skip the open market
The incentive is not mysterious once you sit with it. A public listing means a visible clock. Every price cut, every relisting, every extra week on market becomes part of the permanent record a buyer's agent will pull up during negotiation. For a seller who does not need a bidding war to get a fair price, and who would rather not have a widely photographed home searchable by anyone with a portal login, arranging a sale through a broker's existing network solves both problems at once.
The Hill Section offers one of the more visible examples of how this plays out at scale. Land there trades rarely, and much of what does trade moves through relationships rather than open listings. One widely reported case involved a professional athlete who quietly assembled two adjacent Hill Section parcels, adding nearly 10,000 square feet to an existing lot to create a combined holding of more than 20,000 square feet of land, before either purchase was confirmed through public property records rather than an open listing. National outlets covering sports business and luxury real estate broke the story well before local buyers would have had any way to track it through a standard search.
That is the off-market economy in miniature. The deal gets done. The comps get quieter. And the next buyer trying to understand what Hill Section land is actually worth has one fewer data point to work with, because the transaction that would have told them never became public.
The cash surprise in the Tree Section
Here is where the data stops confirming what most buyers already assume. Across Manhattan Beach, cash purchases dipped to 36 percent of sales in the January-through-April 2026 window, down from a share close to 50 percent in each of the two prior years. That decline tracks with what you would expect as financing costs ease and more buyers return with loans.
The surprise is where the cash concentrated. It was not the Sand Section, where walk-street trophy homes and Strand-adjacent properties draw the deepest-pocketed buyers. It was not the Hill Section, where ocean-view lots regularly clear seven figures before a shovel touches the ground. It was the Tree Section, Manhattan Beach's most family-oriented, most middle-of-the-market submarket, that posted the highest concentration of all-cash deals, at 48 percent of sales.
That is worth sitting with. The Tree Section is not where you would expect cash to matter most. It is the section built around Mira Costa High School boundaries, tree-lined residential streets, and buyers who are, by most measures, more like a typical move-up family than an international investor. Yet nearly half of the deals there closed without financing in early 2026.
The likely explanation has less to do with wealth concentration and more to do with competition. The Tree Section is, as Fratello put it in a separate market recap, part of "our little hamlet/bubble" that keeps generating its own demand almost regardless of broader conditions. When a well-priced Tree Section home hits the market, it draws a deep pool of buyers who all want the same handful of streets near the same elementary schools. In that setting, cash stops being a luxury flourish and becomes a plain competitive tool, the fastest way to remove financing contingency risk from an offer when you know six other buyers are writing the same offer that weekend.
What this means depending on which side of the transaction you're on
If you're searching
Assume that roughly one home in five you would genuinely want to see, particularly in the Tree Section and Hill Section, will never appear in a portal search at all. That is not a reason to panic. It is a reason to build a relationship with someone plugged into the local network before you need one, rather than after you have lost a home you never got to see. If you are also planning to compete with a mortgage contingency in the Tree Section specifically, know that you may be competing against a buyer who has already removed that contingency entirely.
If you're selling
Going off-market trades a public bidding process for privacy and a controlled reveal. That trade makes sense for a well-known owner, an unusual lot, or a seller who wants to test a price quietly before deciding whether to commit to a public campaign. It makes less sense for a home whose value depends on broad price discovery, where more eyes and a real bidding process typically produce a stronger outcome than a single negotiated buyer ever will. A home valuation is the right starting point either way, because the strategy should follow the number, not the other way around.
Quick answers
Does "off-market" mean the sale is secret? Not in the legal sense. It means the property was never listed publicly on the MLS before closing. The sale still records at the county once it closes. What is missing is the public listing history, the photos, and the open competition that a portal search would have shown.
Is a cash offer required to compete in the Tree Section right now? No, but the data through April 2026 shows financed buyers are competing in a pool where nearly half of recent sales closed without a loan. A strong financed offer can still win. It simply needs to be structured with that reality in mind.
Manhattan Beach rewards buyers and sellers who understand the parts of the market that never show up in a search bar. If you are trying to make sense of what is actually happening on a particular street, section, or lot, Azure Hynes is glad to talk it through. Let's Connect.
