Tuesday, March 17th, 2009 at 2:00 PM
High-End Sales
As predicted, the spin on recent sales activity is fast and furious. This morning on sports-talk radio even Scott and BR were saying it’s a great time to buy a house!
Here’s an excerpt from today’s U-T’s story:
University of San Diego real estate economist Norm Miller estimated that top-end homes may have lost 10 percent to 15 percent in value in 2008 – enough to represent about half the drop-off in sales count as those homes sank below the million-dollar mark.
Miller said costly homes likely will hold more of their value this year than lower-priced homes because fewer owners are subject to default and foreclosure and thus are not forced to sell. For other high-end owners, there is no urgency to sell, especially when bargain hunters offer far below the asking price.
“I think homeowners in these more stable neighborhoods are basically sitting on the sidelines – that’s the smartest thing to do,” Miller said.
As a result, the supply of expensive homes remains low and helps maintain price levels.
Supply of expensive homes remains low?
There are 1,913 detached homes for sale in San Diego County over $1,000,000.
There were 39 that closed escrow last month (a 49-month supply), and 169 are pending.
I think we have plenty of supply, in fact, million-dollar homes for everyone!
There are a couple of other quotes, here’s the link:
Posted on Tuesday, March 17th, 2009 at 2:00 PM in Psycho-babble, Thinking of Buying? | 18 Comments » | 
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Perhaps they meant there aren’t as many million dollar homes anymore. (ducks out of way)
sdbri | March 17th, 2009 at 2:27 pmFrom the article: But 24 percent of buyers paid cash, up from 14 percent in 2007, and for those buyers who bought homes costing more than $5 million, more than half were all-cash deals.
The rich are different from the rest of us.
Rob Dawg | March 17th, 2009 at 2:31 pm“I think homeowners in these more stable neighborhoods are basically sitting on the sidelines – that’s the smartest thing to do,” Miller said.
This guy sounds like a real genius in my opinion. The top end of the market is headed for a sizeable fall in the coming years. The market is flooded with properties at the high end. The recent plunge in the stock prices will mean even more pain going forward for the top end of the market.
Where in the world did this guy receive his degree from? The fact that he calls himself an economist is an insult to the profession and the university he works for.
Nathan | March 17th, 2009 at 2:47 pmMiller says: “I think homeowners in these more stable neighborhoods are basically sitting on the sidelines – that’s the smartest thing to do,”
Spotty says: “I think HOMEBUYERS in these more stable neighborhoods are basically sitting on the sidelines – that’s the smartest thing to do, prices will come down sooner or later”
Spotty | March 17th, 2009 at 3:15 pmIsn’t it always a great time to buy?
My financial advisor told me it was a great time to buy citi shares at $20.00.
It is a better time to buy than it was two years ago that is for sure.Closer to the bottom than we were 6 months ago.
arizonadude | March 17th, 2009 at 3:48 pmFrom the same artile:
“the county assessor’s office said there were 22,707 homes assessed at $1 million or more in the region last year, up from 21,239 in 2007. Realtor.com listed 2,477 of the 17,462 homes for sale in the county yesterday as priced at $1 million or more”
That mean every 1 in 10 million dollar homes are for sale… That is pretty stressful if you ask me….
Eric Chang | March 17th, 2009 at 4:07 pmThe assessors office is still increasing home values +2% annually. Maybe that’s part of the increase in the number of $1MM homes even though it isn’t so.
What’s amazing is that anyone is able to sell without financing available and for all cash.
15% drop for the upper tier seems about right. I don’t believe the upper tier skyrocketed like the lower tier did. Anyone remember our old friend the San Diego Home Price Index? Check out the graphs.
http://sdhpi.blogspot.com/
Mozart | March 17th, 2009 at 4:29 pmAssessed values are irrelevant since they have little to do with the true market value of a home. Unless you recently purchased or had a re-assessment.
Casey | March 17th, 2009 at 5:34 pmSo here’s a high end (low end RSF) home that appears to have somewhat broken a price barrier: http://www.sdlookup.com/MLS-071069672-4212_Via_Ravello_Rancho_Santa_Fe_Ca_92091
On an acre of land and with a pool, it comps out pricewise to a much smaller villa on a tiny parcel.
Is this a blip, or the beginning of what’s to come. BTW, I happen to think this was a pretty good deal in today’s market. A year from now – who knows?
HappyRenter | March 17th, 2009 at 6:23 pmYes, there will be more slippage in the high end market, but I don’t see it being anything like the blood bath in the starter homes and the McMansions. You want that classic mansion overlooking Point Loma? That’s not dropping 25%. 10, maybe. That house will always have that view and that will always be worth something.
Former RB Resident | March 17th, 2009 at 7:27 pmThere will be blood in all markets. That doesn’t mean I’ll ever be able to afford that mansion overlooking Point Loma, but don’t think for a second that price isn’t going to dive 25% or more.
Why do people think the high end is immune?
The Blur | March 17th, 2009 at 7:45 pmA home’s assessed value usually has nothing to do with its actual value. Those aren’t $400K mansions in Beverly Hills. That said, briefly it will in a down market as people appeal the assessment to get it lowered.
sdbri | March 17th, 2009 at 9:00 pmI’ve seen a million dollar foreclosure recently.
ToadB | March 17th, 2009 at 10:49 pmThe Blur,
The high end isn’t immune, but it wasn’t blown way up in the bubble either. Most of us will never afford a 10M house. Those who can often pay cash. That’s not a big market. I think what we’re doing is talking past each other. “1 million” isn’t really high end any more in expensive urban areas like S.D. So, yes, your 10M house might be worth 9M now, but that’s not a big deal if you’re not living off the HELOC. But if you were waiting for you 1.2 McMansion in Chula Vista to be worth 1.7 so you could buy that boat, well, you’re screwed.
Jim said it best the other day: there really isn’t a market anymore. A well placed and well priced house in a stable neighborhoodis still worth something – perhaps a lot of something. A cookie cutter house in the far flung suburbs…
Former RB Resident | March 18th, 2009 at 7:08 amnot so much.
I’ve only got 2 rules in life:
1) “don’t bet money that you don’t have on a dog race with your ex-girlfriend, who happens to be a stripper”
SD_Coastal | March 18th, 2009 at 7:13 am2) DO absolutely the opposite of whatever Scott and BR say.
While reading this blog last night, my dog chewed up my nice motorcycle jacket. Damn you JTR!!!
ChrisL | March 18th, 2009 at 8:30 am“I’ve only got 2 rules in life:
1) “don’t bet money that you don’t have on a dog race with your ex-girlfriend, who happens to be a stripper”
2) DO absolutely the opposite of whatever Scott and BR say”
I heard this yesterday and I’m paraphrasing:
Inland Empire | March 18th, 2009 at 9:30 am3. “Don’t play poker with a man named Slim. Don’t buy a Rolex from a man out of breath. Don’t take financial advice from a man(Scott and BR) who is shouting it’s a good time to buy.”
Have to love financial advice from Tincup.
Rule 4.
Don’t buy what smart investors are selling.
Lostozzy | March 19th, 2009 at 11:18 am