A brief tour of a new home in Carmel Valley:
Category Archive: ‘Carmel Valley’
The Qualcomm press release today:
The company expects to fire about 15% of its semiconductor business’ full-time staff, significantly reduce its temporary workforce, and streamline its engineering organization.
They expect to layoff around 4,500 people company-wide. What does that mean for the local real estate market? Let’s point out the general changes:
1. YOU DON’T HAVE TO MAKE YOUR PAYMENTS.
A result of the financial crisis – banks are equipped to let you ride for months or years without making payments.
There will be severance packages, plus stock and stock options to live on.
3. ONLY RECENT PURCHASERS WOULD FEEL THE SQUEEZE.
If a Q-employee bought their home more than 3 years ago, they have plenty of equity, and have probably re-financed at a low rate. Payment amounts are tolerable, especially compared to rents in the same area.
4. MICKELSON EFFECT
Phil Mickelson made a big stink about the state tax he has to pay (probably around 13%) – but you haven’t heard a peep out of him since. Why? My guess is that his wife put her foot down, and told him they aren’t moving anywhere. The same thing would happen here – even if a spouse or both are laid off, they will exhaust all avenues to maintain the same lifestyle and kids’ upbringing. Selling the house would be the absolute last resort.
5. BANK OF MOM AND DAD
The kids have been very successful up to now, and the grandparents will drain a few accounts to help keep the grandkids’ lifestyle in place.
There would be loads of buyers today of homes priced at 20% under today’s values. If that is the floor, then about 10% off would be a retail-price target. We could have a few different factors contribute to a similar discount (Fed move, Grexit, unknown factors, etc.), but we already endured the most severe downtown in the history of real estate and the premium areas didn’t take much of a hit.
Let’s use Carmel Valley as the target market to follow:
|May + June stats|
A mass exodus of elderly or foreign homeowners is much more of a concern – they’re urgency is higher, they have less reasons to stay, and they can probably afford to dump.
No shortage of demand for the brand new high-enders. Here they’ve sold 100+ houses and lots already, averaging $2,000,000 or so for the houses.
If you are on the lengthy list of waiting buyers (who had to pre-qual to $2M), is time running out? Do you opt for one of the two 1-story plans with 25-ft backyards available, or hold out for a future phase and risk getting nothing?
Earlier today, reader ‘socalbuyer’ asked,
Word on the street is that Qualcomm is going to layoff a couple thousand folks in San Diego this year. Wanted to get your thoughts on how that would affect the real estate market in San Diego. Most of those jobs may not find a fit in San Diego, and a bunch of Qcomers probably don’t need to sell.
It should mean an instant 10% decline in prices around Carmel Valley because buyers will expect some insurance. Sellers will reluctantly agree because they probably made that much in appreciation over the last year.
After that, it will get interesting.
The unemployed will shine up their resume and hunt for a new job for a year (or more) before ‘giving it away’. Spouse and kids won’t surrender easily either.
This is what we can expect from any disaster, natural or otherwise, that shocks the system. Buyers will be prone to hesitate, and the sellers who feel somewhat panicked will accommodate by lowering their price to clinch a sale.
Real estate isn’t known to be a liquid asset, so everyone will adjust expectations after the initial pop.
My understanding is that we have a total of 9000+ property sale transactions a year in San Diego…the qcom layoff number is as high as 5000. Figure 50% find a job out of San Diego and need to sell, 2500 units on the market sounds sizable, especially if most are in 92130.
Last year there were 22,079 detached homes sold in San Diego County, and 470 in the 92130 – which is only 39 per month. If pricing retreated a little, there could be a surge of CV buying but either way, it is a small portion of the market compared to the overall county. I’m guessing that there is enough underlying demand that any excess properties will get soaked up – it’s just a matter of price.
Carmel Valley prices have gone up 20% in the last 2-3 years. If sellers had to give that much back, they’d survive. The market will too – CV has too much going for it.
One of the most affordable ways to get into the Del Mar School District:
Will better access to Del Mar Mesa make a difference? I don’t know if it will raise prices, but it should cause buyers to re-consider the benefit of exiting the I-5 freeway at the Carmel Mountain Rd. bypass and be home in 10 minutes, rather than fight traffic to Rancho Santa Fe for an extra 30-45 minutes:
The opposition has to be in shock:
In front of a packed house, the San Diego City Council approved a controversial mixed-use project in Carmel Valley after hours of public comments.
The One Paseo Project includes the construction of stores and eateries, the expansion of a movie theater and the addition of more than 600 family apartments and a parking structure in Carmel Valley.
The San Diego Planning Commission approved the proposal for the $750 million, 1.4 million square-foot, mixed-use village slated for the corner of Del Mar Heights Road and El Camino Real. The panel agreed to the plan on the condition that developer Kilroy Realty agreed to make 11 changes to the master plan.
On Monday night, the San Diego City Council approved the plan 7-2, though they did say Kilroy must add 60 affordable housing units and a sychronized traffic system. Council President Sherri Lightner and Council President Pro Tem Marti Emerald were the dissenting votes.
Hundreds showed up Monday to hear the debate at council chambers — so many that Golden Hall had to be used as an overflow area. About 600 people signed up to speak on the issue, many wearing red shirts to show their opposition to One Paseo.
The Carmel Valley Planning Board voted against the current proposal but its members have said they support a smaller version of the plan.
I don’t have a dog in this race, I just like seeing people getting involved in their community. KPBS has both sides of the debate here:
In Carmel Valley, the P-team is cranking up the new-home production in 2015, with several new homes in all price ranges coming to market.
Sellers of older existing homes can use these as a guide for pricing – because you know the buyers will: