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THINGS YOUR BURGLAR WON’T TELL YOU
 
1. Of course I look familiar. I was here just last week cleaning your carpets, painting your shutters, or delivering your new refrigerator.

2. Hey, thanks for letting me use the bathroom when I was working in your yard last week. While I was in there, I unlatched the back window to make my return a little easier.

3. Love those flowers. That tells me you have taste … and taste means there are nice things inside. Those yard toys your kids leave out always make me wonder what type of gaming system they have.

4. Yes, I really do look for newspapers piled up on the driveway. And I might leave a pizza flyer in your front door to see how long it takes you to remove it.

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Welcome back, I hope you had a great Christmas!

I’m looking forward to 2010, more so than any other year. 

Why?

Because I’m convinced that people want the truth, we’re going to keep serving it up here at bubbleinfo.com.  Taking the high road is wrought with challenges however, primarily when trying to sell short sales and REOs.  There aren’t any rules or regulations on how the deal with these, so listing agents make them up as they go along.

When I write an offer on a short sale, I call the listing agent first, looking to get his commitment – if I can narrow down the target, it’s easier to hit.

Example:  Two weeks ago I had a listing agent agree that if my buyer was willing to write an all-cash offer at the price specified by the listing agent, he would have his sellers sign it, and submit it to the bank - let’s call it a pre-negotiated deal. 

It’s not easy getting listing agents to commit on short sales; when there are no rules, they like to play around.  Sure enough, we submit the offer as agreed, but two weeks go by and he’s not calling back, not responding to emails, etc. – the usual ploy. 

I finally caught him on Wednesday, and he said that he’s giving a female agent more time to try and sell this seven-figure property because he got the feeling that he might be able to score with her – and I’m not talking Chargers’ touchdowns here.

While he was probably joking (hopefully?), it’s another of hundreds of examples I could give you about how difficult it is to buy a house in this environment.

What am I doing about increasing your odds of buying?

1.  Numbers game- You need to see a lot of homes – the vast majority are priced wrong, and the few that have a decent price are hotly contested.  It’s likely that you’ll lose a few to other offerees, or to the condition of the house.  In 2009, we had a number of accepted offers cancel due to the property’s condition after a thorough inspection.

The addition of Richard Morgan to the team this year brought an added dimension to our ability to show more properties, and between us we’ll make sure that we can meet you at any house, any time – no problem.

2.  Selling your offer - It is imperative that I submit a compelling case to the listing agent on why he should take my deal.  Any quality property that’s listed for an attractive price is going to have competing offers, and ours has to stand out.   

3.  Trustee sales - My primary goal in 2010 is to be able to offer trustee sales to my buyers.  It won’t be for everyone due to the risks, but having more homes to consider will be helpful in this low-inventory environment.

4.  Keep bubbleinfo running- One of the agents on the board of realtors told me the other day that he thought bubbleinfo.com was unethical. 

It would be unethical if I didn’t do this website - I know critical facts about the market, and feel compelled to disclose them.  I think I have tempered the presentation here to comply with the Sandicor MLS rules and regs, and conduct a free educational experience here which can benefit consumers and agents alike.  But I realize that there will be more people gunning for me than ever in 2010 – but I plan to endure.

How I intend to expand bubbleinfo.com:

A.  More interactive opportunities – the pizza and beer party should happen at least a couple of times per year, and I’d like to do more blog talk radio if I can keep the call-in costs down to participants.

B.  More personal interviews on video, like the series with Adam on trustee sales.

C.  Show more of the intricate details of selling real estate on video.

D.  Tell more stories.

I am always interested in what you’d like to see here – ideas are welcome!

Kelly has a nice update on the Vantage Point condo complex downtown:

http://www.voiceofsandiego.org/articles/2009/05/04/housing/840vp050309.txt

From the article, the big picture of the downtown SD condo market:

“It is unclear even yet what effect the building’s opening will have on the rest of the downtown real estate market, already weighed down by more than 850 finished unsold units, according to MarketPointe Realty Advisers.”

“The homes at Vantage Pointe and another 148 at another under-construction project downtown will double that number.”

Just 1,600+ new condos and 599 resales on the market? 

It should make for an attractive market for tenants who are looking to move….

Another example of what is undermining the market, and the reputation of realtors in general. 

This guy doesn’t even have this listing, he is just advertising bank-owned properties before they get on the market.  I called him, and he defended the practice, because his broker authorized it – though I know it is not allowed.  

His list price is at least $100,000 under what the eventual list price will be (click on it twice):

(hat tip to CG!)

Here is a review of homes that have gone pending in the last ten days – we don’t know if they’ll close, and if so, at what price.

Wouldn’t you think that finding a buyer this month would be challenging, given:

1. Four inches of rain this month (most since 1984).

2. Tighter mortgage underwriting, fewer programs, higher jumbo rates.

3. Raging unemployment

4. Worst economic news of our lifetime – recession/depression news daily.

We don’t know the sales prices of these, so let’s put pricing aside for now and just consider what is being offered, and how long they’ve been on the market.  

Could the agents have noted them pending just to give the occupants a Christmas reprieve?  The new MLS reports the name of the buyer’s agent, and all but Jason are marked as being sold by agents from different companies - which probably indicates they are legitimate sales, and not just on a holiday break.

Carlsbad

Whitecap  MLS#080060285

3 br/2.5 ba, 1,700sf

YB: 1988 - 4,476sf lot - $100/mo fees

OLP: $640,000  8/28/08

LP: $600,000 11/22/08

Pending Date: 12/17/08

DOM = 111

Last two sales on street were both in July – $560,000 for 1,675sf with no view, and $660,000 for 1,766sf with ocean view (and freeway noise).  Original owners.

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Highland  MLS#080070885

3 br/2.5 ba, 2,551sf

YB:1961

17,850sf lot    (no monthly fees)

LP: $989,000  10/16/08

Pending date: 12/19/08

DOM = 65

Due-west view looking directly at power plant and smokestack.  Looks like original owners on tax rolls, interior photos reflect same.

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Corte Rosado  MLS#080070319

6 br/5.5 ba + granny flat  5,203sf

YB: 2001  - 25,000sf lot - $178/mo fees

OLP: $1,995,000 10/13/08

LP: $1,750,000  11/7/08

Pending Date 12/24/08

DOM = 72

The Ranch is Carlsbad has some of the best real estate in town, but no recent momentum.  The only two sales this year have been $1,150,000 and $1,475,000, and another is pending, listed at $1,187,500.  Original owners.

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Encinitas

E. Jason  MLS#080080463

3 br/2 ba, 1,062sf duplex

YB: 1959 – 6,969sf lot – no fees

OLP: $775,000  12/1/07

LP: $549,000-$599,000  12/1/08

Pending date: 12/23/08

DOM = 203

Off Vulcan and only about 100 yards east of the railroad tracks in Leucadia, this location would be considered ‘less-than-premium’.  The immediate neighbors around you are nothing fancy, mostly apartment-style homes, and it’s a long walk to the beach.  Could be a 1031 exchange?  Seller paid $199,000 in 1991.

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Spanish Bay  MLS#080077499

4 br/3.5 ba,  4,579sf

YB: 2003

10,128sf lot, $510/mo fees

LP: $1,995,000  11/15/08

Pending date: 12/17/08

DOM = 32

Former model home with ocean and golf views.  The seller paid $2,100,000 in July, 2005, so not much of a discount for buying at the peak.  The agent called it the best home and lot in Encinitas Ranch, but all I know is that I hit it with a golf ball a few years back.

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West RB (92127)

Rancho Catalina Trail  MLS#080062449

4 br/3.5 ba, 3,975sf

YB:2005

27,007sf lot – $715/mo. fees

LP: $1,050,000 – $1,200,000

Pending date: 12/18/08

DOM = 102

Seller is original owner who paid $1,191,500 in February, 2005.  For an area that has been in every bubblesitter’s sights as the next to fall, and for being under the power lines, she did pretty good – if it closes.

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7442 Rancho Cabrillo Trail MLS#080066755

5 br/5.5 ba, 5,118sf

YB: 2005 – 22,651sf lot – $821/mo. fees

OLP: $2,120,000  6/9/07

LP:  $1,249,000 – $1,399,000

SP: $1,249,000  12/23/08

DOM = 423

This short sale did just close this week, and noteworthy because it’s probably the worst location in the Mirasol tract, right next to the creaking gate with no view.  The agent called it highly upgraded, but I remember it as dark and needing work - and you can see the contractor’s truck in the driveway.  Seller had paid $1,451,000 in May, 2005.

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Carmel Valley

Foxhound  MLS#080082171

4 br/4 ba, 3,609sf

YB: 2000

8,476sf lot, $196/mo. fees

LP: 1,045,000 – $1,145,888  12/10/08

Pending Date 12/17/08

DOM = 7

Even though this backs right up to busy Carmel Mountain Rd., it blew off the market the first week.  Another original owner – paid $641,000 in 2000 and didn’t refi out a penny.  There have been very few decent 3,000+ sq. ft. homes in Carmel Valley sell under $1 million this year, and this one will probably close above $1.1 million.

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Pearlman MLS#080064011

4 br/5.5 ba 4,346sf

YB: 1998 – 8,450sf lot – 0 fees

OLP: $1,350,000  6/2/08

LP: $1,185,000  12/15/08

Pending date: 12/18/08

DOM = 169

Decent house for a foreclosure (former owner paid $1.45M in Jan.’06) but on a busy corner, with cars traveling 25-35 miles an hour.  One block from elementary school.

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Jordan Ridge  MLS#080064141

4 br/4 ba, 3,358sf

YB: 1994 – 7,156sf lot – $103/mo fees

OLP:$1,125,000  9/15/08

LP:  $1,079,000 – $1,124,876

Pending date: 12/23/08

DOM = 99

Standard CV offering, yet not much give on price – pending on December 23rd!

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Wyngate  MLS#080068068

4 br/4.5 ba, 4,008sf

YB: 1997 – 10,454sf lot – $158/mo. fees

OLP: $1,775,000 10/3/08

LP: $1,699,000  10/31/08

Pending date:  12/18/08

DOM = 77

Original owner (named Pardee) selling a premium location at end of culdesac with views of Fairbanks and a lot of extras.

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It’ll be easy to call these ‘knife-catchers’ and dismiss them as having very little significance, but I only include them because of the time of year and the negative environment.

Here’s a link to a map, the balloons don’t stick to the exact house, but are close:

cherrypickers

Fortune Magazine published their list of the 10 worst real estate markets for 2009, and San Diego was ranked #8.

http://money.cnn.com/galleries/2008/fortune/0812/gallery.worst_markets.fortune/8.html

Their sources were Moody’s Economy.com and N.A.R., so take it with a grain of salt.

In fact, take ALL prognostications with a grain of salt.

Today’s buyers are so discerning that they are buying only if they find a great house at a great price, and you can’t blame them. But if we saw a trend of closed sales that demonstrated ONLY ONE of those two, it could be a sign that the market is heating up.

In other words, if you saw a bunch of inferior homes close escrow, then you can figure that pressure might be building on the buyer side of the equation.

So keep an eye out for those quirky properties selling. If there is ever going to be some market stability, that’s one place where you could see it beginning.

Here’s an example of one that went pending this week, after 191 days on the market. It is 2,091sf listed on the range $718,888 to $748,888 (original list price $768,888):

You could say that selecting this property was cherry-picking, and of course it hasn’t closed yet either. Another house was mentioned in the beginning of the video on Sago in Carlsbad that has already fallen out of escrow, so we won’t belive it until we see ‘em closed.

If you are looking for a sign that the market might be improving, keep an eye on the eventual closed sales prices on those that seem like the ‘lucky pendings’. Later I’ll submit a host of others that went pending in the last 7-10 days that may leave you shaking your head.

How about sales in general?

There were more SD detached closed sales between 12/1 and 12/15 this year compared to 2007, but you can guess that it’s only those properties that are being given away that are closing:

Year	# of closings	DOM	$$/sf
1999	981	77	$157
2000	1,006	50	$186
2001	801	50	$197
2002	1,017	38	$243
2003	1,210	37	$287
2004	1,122	50	$348
2005	850	56	$358
2006	875	70	$352
2007	448	70	$304
2008	728	59	$224/sf (-26% YOY)

Could the local real estate market heat up in 2009, in spite of the prognosticators? Common sense would say, “Not a chance”, but let’s keep our eyes and ears on the lookout, and see what happens.

Here are other indicators of a market that’s heating up (or not):

1. New listings going pending in the first three days of listing.

2. Properties going pending that have been on the market for a long time (4+ months), and closing.

3. Sales closing at or above list price (but check for possible seller credits).

There are a lot of uncertainties out there, so none of the indicators matters much until it’s a closed escrow.