The number of NSDCC detached homes for sale is quite a bit higher today, than it was a year ago – but it isn’t like we haven’t been here before. Look at 2015:
With more competition and fewer sales, it will turn into a year-round market as sellers try longer into the holiday season, and probably start earlier next year.
There are times when the general market is in a funk and homes aren’t selling – when it’s easy to think, “Oh this is it, we’re cooked”.
There are also times when the market erupts, and a series of homes that have been languishing for months and/or homes that appear overpriced go pending – which then triggers additional pendings nearby.
Our market is having one of those surges right now!
Not just a couple here and there – we have had dozens of NSDCC homes go pending in the last 10-14 days that have been listed for months, or priced so high you’d think they don’t have a chance.
You sure want to be on the market when that happens!
Richard and I both sold our listings featured here on Friday, and in my case, Tom’s house was the third one listed over $900,000 in South Oceanside to go pending in the last week!
Get Good Help!
Now that the media is trumpeting a slower housing market every day, you’d think there might be more sellers hitting the panic button and listing their house for sale this year, rather than wait for the Glut of 2019.
But this week, the number of new listings dropped 32%! The count from the previous week was 101, but we only had 69 new listings in the past seven days.
The number of pendings is holding up too (+1 this week).
Let’s compare the exact time in question when things started feeling different towards the end of the selling season.
NSDCC Sales between Aug 1st and Oct 15:
||Number of Sales
In 2014, mortgage rates had been coming down – from 4.43% in January to 4.04% in October – and the median sales price was 24% lower too. Yet we had more sales in 2018!
By the Spring of 2019, you can bet that any talk of a year-end slowdown will be shrugged off and blamed on the holidays – and that next year’s pricing will be right back to (overly) optimistic.
Buyers – it won’t get better next year!
Get Good Help!
Yesterday, Bill featured the C.A.R. release about September sales that included the president’s comment that buyers are ‘self-sidelining’ in anticipation of lower prices ahead. White included his obligatory blame on the tax reform, which he was so adamantly against even though his case was based on faulty evidence – and it passed anyway.
Bill also included the chart above that showed inventory explosion in CA:
Let’s review our NSDCC stats to see how we are behaving:
||Total Listings YoY
||Total Sales YoY
||ACT Inventory Mid-Oct
Our current NSDCC inventory is 25% higher than last year, but it just highlights what a great year we had in 2017 – when the TL/TS ratio was similar to the full-tilt frenzy we had in 2013.
This year looks a lot like the more-normal years of 2014-2016, when the sledding was much tougher. As long as our current stats are staying in-line with previous years, we should be fine.
Expect more of the same – buying and selling homes is going to be difficult.
Get Good Help!
The total number of pendings went up 2% this week, and the number of closed sales for the first half of October (116) is higher than last year (114).
Statistically, the market is ‘fine’ up to the $1,600,000s.
The actives/pendings count for NSDCC listings priced under $1,650,000 is 355/183, or almost exactly the 2:1 ratio we use to describe a healthy market.
It may feel like a bit of a struggle now, but the distractions have just begun. Halloween is next week!
In the never-ending attempt to make sense of the market using data, it is interesting to note today that in two out of three price categories, the current pendings are priced higher than the actives.
||NSDCC Active Listings
|$1M to $1.5M
|$1.5M to $2M
It’s makes me think that the home’s condition is what’s driving sales. People are willing to buy, and even pay a little more for the creampuffs, while the homes with any defects are struggling to sell.
Buyers are looking for any reason not to buy, and stay on the couch. All we need to fix that is a compelling home/price!
The number of pendings went up this week, giving hope that our local real estate market will glide through the off-season.
There are 19% more houses for sale between La Jolla and Carlsbad today than there were a year ago, but it doesn’t feel like it – unless you are in the higher-end market where there are still 523 houses priced over $2,000,000 that are selling slowly (84 pending though!).
For those looking for our jumping-the-shark moment, this might be it.
Inventory is growing, and there is only one reason: More prices are wrong.
But when you sell your best asset down the river and let amateurs run it who are out of touch with reality, you get explanations like this:
The number of homes for sale in the country is starting to flatten, which realtor.com® researchers say is signaling a “crucial inflection point for the inventory crisis.” Inventory has decreased slightly by 0.2 percent from a year ago, but is poised for an increase in the months ahead due to an 8 percent increase in new listings. This marks the largest annual jump since 2013, according to a new report from realtor.com®.
“After years of record-breaking inventory declines, September’s almost-flat inventory signals a big change in the real estate market,” says Danielle Hale, chief economist for realtor.com®. “Would-be buyers who had been waiting for a bigger selection of homes for sale may finally see more listings materialize. But don’t expect the level to jump dramatically. Plenty of buyers in the market are scooping up homes as soon as they’re listed, which will keep national increases relatively small for the time being.”
She gives the impression that more homes for sale will be satisfied by pent-up demand – that we shouldn’t “expect the level to jump dramatically”, because the new inventory will get scooped up.
If you ask me, +34% and +24% is dramatic!
Inventory is up because buyers are waiting for a bigger selection of affordable and better-priced homes for sale. Any time the inventory grows, it is due to overly-optimistic pricing.
Here we are – Happy 4Q18!
Predictably, the inventory is starting to subside, and hopefully just leaving the motivated sellers. The number of houses in escrow is a good gauge, and they have been steady over the last five weeks (312, 302, 305, 296, and 302).
The September sales are going to be less than last year though.
We had 259 NSDCC sales in September, 2017, and 264 in 2016. We’ve had 192 sales marked closed last month – but it’s early. It should get up to 220 or more.
We are mellowing down easy – the new pendings averaged 50 per week in September (they were 55 per week last year, and 66 per week in 2016). The total number of pendings slipped under 300 for the first time since mid-February, and are now at 296.
The Case-Shiller Index is tomorrow, and October starts a week from today!