An Insider's Guide to North San Diego County's Coastal Real Estate
Jim Klinge, broker-associate
617 Saxony Place, Suite 101
Encinitas, CA 92024
Klinge Realty
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Jim Klinge
Cell/Text: (858) 997-3801
701 Palomar Airport Road, Suite 300
Carlsbad, CA 92011

Posted by on Jan 6, 2019 in Interest Rates/Loan Limits, Jim's Take on the Market, Market Conditions | 3 comments | Print Print

What’s Needed to Boost Sales?

Click on images to enlarge

What’s it going to take to get the real estate market going?

You could say that sales and pricing were at full speed between 2013 and 2017.  What’s the common denominator? Low mortgage rates.

In the graph above, it’s apparent there’s been rate-tolerance up to the 4.2% range over the last few years – which had to fuel home sales.

In the Frenzy of 2013, rates didn’t matter much, but by 2014 you can see it took some incentive to keep the party going. National home sales:

The times when rates have risen over 4.2%, they retreated quickly – except in early 2018.  Once we got into the second half of last year and rates had risen into the high-4s, the housing market stalled out.

The stock market helped too, but now it’s nervous time over there:

A jittery stock market could help housing if people take money off the table, and diversify (which is code for Help the Kids With Their Down Payment).

Are mortgage rates going to go down further?

We dodged a bullet on Friday when the monster job report was released – there was enough concern about the negative variables that rates didn’t jump much:

We can’t count on any help coming from the Fed, the stock market, Trump, Congress, AOC, etc. – we’re going to have to handle it ourselves.

Whoever can solve the mortgage-rate riddle, and get them under 4.2% – or because of the other turbulence, under 4.0%, should win the game.


  1. 2013-2017 was a huge influx of newly minted first time buyers (demographics) and Great Recession stuccos (demographics and Fred and timing) finding their last place while getting rid of their “get in the game” place.

  2. The flip market is over. How many will be left holding the bag? Wealthy investors pooling their money in LLCs and flipping homes will not be a slam dunk anymore. The peak in prices for this cycle has been reached.

  3. I disagree.

    There are dozens of flippers in north county who have made big money for years – what are they going to do, quit?

    They’ll just work down their purchase prices a little lower to compensate.

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