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Category Archive: ‘Market Buzz’

Zestimate Tune-Up?

z

When they first rolled out the improve-it-yourself feature, it turned out to be no more than an opportunity to list your upgrades – because little or no value was added to your zestimate.  I received this by email today:

Hi Jim,

Today Zillow announced enhancements to the Zestimate® home value that allow homeowners to edit their home facts on Zillow and, depending on the new information they provide, potentially see an immediate impact on their Zestimate. For instance, if the square footage of a home is out of date on Zillow, the homeowner can correct this information and see an adjustment in their Zestimate.

Can listing agents use this feature to affect the Zestimate?

We encourage you to work with your seller prior to placing the home on the market to ensure all information on Zillow is accurate. If your seller is concerned about the Zestimate, check the home facts and make updates where needed. We suggest you communicate that the Zestimate is an estimate, not an appraisal.

We continue to iterate on our existing offerings to improve how buyers, sellers and homeowners use the resources available on Zillow. Should you have any questions about the Zestimate, visit www.zillow.com/zestimate.

Sincerely,

Greg Schwartz, Chief Revenue Officer, Zillow Group

I’ll believe it when I see it!  In the end, the zestimates will likely be more inaccurate as sellers fluff their values to the moon.  But Zillow is learning the ways of the industry, and is now siding with the sellers.  Get Good Help!

Posted by on Feb 27, 2015 in Listing Agent Practices, Market Buzz, Thinking of Selling?, Tips, Advice & Links | 1 comment

RSF Auction Today

The highly anticipated, no-reserve auction in Rancho Santa Fe happens later today.  It was on the market for $36,500,000 back in 2006 and for sale ever since – the latest list price was $22,500,000 last year.


Casa Del Sol — from Concierge Auctions

This is the second no-reserve auction in Rancho Santa Fe by this company.  The first was the gambler’s house, and it sold for $13,000,000 last month:

http://www.sdlookup.com/MLS-140037638-5425_Los_Mirlitos_Rancho_Santa_Fe_CA_92067

Any guesses on tonight’s final price?

Posted by on Feb 26, 2015 in Auctions, Market Buzz, Rancho Santa Fe | 8 comments

NSDCC New Listings YTD

It used to make sense that the higher prices went, the more people would sell.

But now here we are at all-time high prices, and not many are interested.  It must be due to the lack of other options – not selling looks better than selling.

New Detached-Home Listings Between Jan 1 – Feb 15

Year
# of New Listings
Median List Price
2001
783
$659,000
2002
760
$707,450
2003
827
$829,000
2004
568
$999,950
2005
632
$1,166,000
2006
890
$1,099,000
2007
777
$1,200,000
2008
758
$1,166,836
2009
706
$1,195,000
2010
663
$959,000
2011
747
$995,000
2012
620
$935,450
2013
622
$1,121,950
2014
622
$1,300,000
2015
603
$1,380,000

One place where there has been some nice action is the $700,000 – $900,000 range along the I-15 corridor.  There has been a steady stream of new product coming to market, and momentum is building as most sell within the first week (catching many sellers and agents by surprise).

When there are only a smattering of new listings like we’re having along the coast, buyers struggle with whether the pricing is real.  A few will sell here and there, but more listings would provide more comfort to buyers, one way or another.  If they see them selling, then they’d be more likely to jump in!

Posted by on Feb 21, 2015 in Jim's Take on the Market, Market Buzz, North County Coastal, Spring Kick | 6 comments

Bubble or No Bubble?

thorn

This article is talking about Oakland, California, but these conditions exist up and down the coast.  Thornberg has been one of the more level-headed bubble analysts:

http://ww2.kqed.org/news/2015/02/18/is-the-bay-area-in-a-bubble-and-will-it-burst

An excerpt:

“This is not a bubble,” says Chris Thornberg, an economist in Los Angeles.

Though he’s just one guy, we called him because he has the dubious distinction of having predicted the 2008 market crash. His colleagues used to call him “Dr. Doom.”

He says that the money flooding the Bay Area isn’t built on speculation like the last boom.

“These are people with real money, with real incomes,” he says. “They have enough money to live in whatever cities and neighborhoods they want, so if there’s not enough high-end housing, they’ll just gentrify lower-income neighborhoods.”

And while the growth may slow, it won’t stop, Thornberg predicts. He believes the solution is a matter of adding to the housing supply. As more units come on the market, prices become more reasonable for everybody, he says.

But others argue that without policies making sure some of the housing is affordable, it’s not going to make any difference for middle-class and poor people.

“That’s completely wrong,” Thornberg says. “The evidence tends to suggest that for the most part, when you start layering rule after rule after rule on real estate developers, ultimately you end up simply hurting the supply worse.”

So what should Eaton do?

Thornberg’s answer? Buy now. Anything you can get.

Posted by on Feb 19, 2015 in Bubble-Era Pricing, Forecasts, How Hot?, Market Buzz, Market Conditions | 11 comments

Not So Hot

It’s happening everywhere you go, and it’s in every conversation with agents – the market is buzzing with “lots of activity”.

What does that mean?  Does it mean anything?

Here’s what it means:

  • Buyers are giddy about getting a 3.75% jumbo rate.
  • Agents are giddy about driving around.
  • Sellers are giddy about selling for more than the last guy.

Sellers and agents who have lots of showings think their house is red hot, and they demand a premium – or at least they aren’t coming off their price much.

But they should be more realistic about those who aren’t offering.

If you have 10-30 showings and only 1-3 offers, it means the vast majority of buyers thought your home was over-priced.

Just because there are a lot of lookers doesn’t mean the eventual buyer will pay your price either.

Here are stats on the NSDCC closings so far this year:

Houses Closed Under $1,000,000

SP:LP = 96.3%

Average days on market: 51

Houses Closed Over $1,000,000

SP:LP = 92.5%

Average days on market: 86

Buyers want to pay a reasonable price, and those averages show that they are being patient.  Of the 192 closed sales so far in 2015, only NINE PAID OVER LIST!

All participants need to be smart about how the market works now.  You get a flood of interest in the first two weeks, and then the activity drops off to nearly zero – and those occasional showings are being used to sell the house down the street.  Be smart, read the market signals, and keep egos in check.

And Get Good Help!

SD prices15

 

Posted by on Feb 10, 2015 in Jim's Take on the Market, Market Buzz, Market Conditions, North County Coastal | 0 comments

Z Talk

Spence has been seen everywhere promoting his new book – we might as well give him some coverage here.

His smugness gets in the way, and it seems that he’s really only looking to prove that he is king of the hill, not give tips that are actionable.

For example, his comparing male to female agents provides some sexy shock value, but he doesn’t go into what it means, or apply any common sense.  If male agents are better at pricing, shouldn’t female agents be better at negotiating because their price is ‘wronger’?


World News Videos | ABC World News

Posted by on Feb 7, 2015 in Market Buzz | 0 comments

Smaller Yards Preferred

yards

A good discussion of the trend towards bigger houses on smaller lots – hat tip to daytrip!

http://www.latimes.com/home/la-hm-0131-outdoor-space-20150131-story.html

Excerpts:

One point generally acknowledged is that many people today do not want the expense and hassle of a big yard. “It’s not practical to have a big lawn these days,” Tighe says. “People are rethinking that, rightfully so.” But they do still want something of a yard, just not the way we think of it.

“That backyard in a sense becomes an important room as part of the house,” says Radziner. “We can live outside if we do it right. Our clients are more interested in the quality of the space rather than the quantity of the space.”

Posted by on Feb 2, 2015 in Market Buzz, Market Conditions | 3 comments

Credit Loosening?

The politicians, talking heads, and NAR pitchmen think that tight credit is to blame for a lackluster housing recovery, but those of us on the street know the local market has been red hot with demand.  The strict underwriting is more of an annoyance that anything, with underwriters requesting every document they can imagine in order to minimize the threat of buybacks.

Has it loosened up?  Will low rates and looser credit spearhead another big year in 2015?  I think so.

Here is an excerpt from this article to demonstrate the loosening:

http://www.mortgagenewsdaily.com/channels/pipelinepress/12122014-super-liens-respa-tila.aspx

Let’s see what some random companies, small and big, have been up to lately to gauge lending trends.

Banc Home Loans has expanded its Jumbo guidelines. Its “Program 55″ highlights include  up to 85% LTV no MI (to $2M), Loan amounts to $5 million, Minimum 660  FICO to $1.5M, 1st time home buyer- loan amounts to $2M, and Primary  Residence: Cash Out Refinance now to 75% LTV (Cash-out up to $1  million).

Caliber’s enhanced Fresh Start Program was rolled out. The two biggest features are bank statement option for self-employed  borrowers, and no seasoning or mortgage payment history required for  Short Sale, DIL, Foreclosure or Bankruptcy.

BluePoint Mortgage has Jumbo IO products with 89% LTV up to $1,500,000 with NO MI Loans up to $3,000,000 and 80% IO to $2,000,000, Up to $500,000 Cash Out, Second Home and NOO options, Cash out for second homes and NOO.

Carrington Mortgage Services, LLC announced the national availability of “The Carrington Loan,” offering  borrowers a more transparent, simplified home loan process with no  closing costs or upfront financing fees. The Carrington Loan can  facilitate home purchases for borrowers in the sub-640 FICO score range.

Wells Fargo Funding improved its refinance adjusters for all non-conforming products as of  November 10th, adjuster improvements are listed on the daily rate  sheets. In addition, its minimum down payment requirement has been  removed from its conventional conforming loans.

Stearns Wholesale is now offering new FHA FICO options 600-619 FICO score program.

Next year should bring in more demand from those who have been shut out previously from getting a mortgage, and those types aren’t known for patient decision-making.  It might feel more like 2006 all over again?

Posted by on Dec 12, 2014 in Market Buzz, Market Conditions, Mortgage Qualifying | 7 comments

Chinese Influx Winding Down?

Alisha Chen

Hat tip to daytrip for sending this in:

http://www.latimes.com/business/realestate/la-fi-chinese-agents-20141101-story.html

Excerpts:

“At first, they were a little leery,” she recalled. “They’d say, ‘OK. I’ll buy one property as an investment.’ Six months later they were amazed at how much they were getting back. They call and say, ‘I want to buy more.'”

Today, the transpacific trade in Southern California real estate is big business. Chinese citizens bought $22 billion worth of homes in the United States in the 12 months that ended in March, according to estimates by the National Assn. of Realtors. And with its direct flights to China and large Asian communities, the Southland is their favorite destination.

They’re buying homes for themselves to emigrate, for their children to attend college, or for rental income. Neighborhoods from Irvine to Arcadia are being transformed.

Chen now employs eight people — who, combined, speak eight languages — to buy and manage properties. She has offices in Irvine, Chino and Taiwan. When she hears grumbling about Chinese money pricing out American home buyers, she notes that it helped revive the housing market, and that all those transactions keep people working at banks and title companies and contractors.

“This has created a lot of jobs,” she said.

But even she’s starting to wonder how much longer this influx of cash from across the Pacific will last. The Chinese government keeps making noise about clamping down on currency leaving the country. The U.S. government is talking about taxes on foreign investors, which could make buying here a little less attractive. Buyers are starting to get a bit spooked. And there’s only so many of these deals she can do.

All that has Chen wondering what trend might come next.

“I think I’m not going to be putting as much energy into this,” she said. “I think the next few years are going to be a good time for first-time buyers.”

Posted by on Nov 4, 2014 in Market Buzz, Market Conditions | 0 comments

McTeardowns

teardowns

From our friend Karen at BloombergBusinessweek:

http://www.businessweek.com/articles/2014-10-15/chinese-home-buying-binge-transforms-california-suburb-arcadia

“Oh, hey! How ya’ doin’?” Raleigh Ornelas hollers, leaning out the window of his spotless white pickup truck. He’s recognized the man across the street, a developer standing in front of a Tuscan-style mansion under construction. “Where have you been hiding at? I call you, you don’t call me.”

Ornelas is an informal broker in Arcadia, Calif., a Los Angeles suburb at the foot of the San Gabriel mountains. He’s been keeping an eye out for the builder, an Asian man with a slight comb-over who goes by Mark. Ornelas has found two older homeowners who’ve finally agreed to sell their properties, and he knows that Mark, like all developers here, needs land on which to build mansions for an influx of rich clients from mainland China.

Ornelas rattles off addresses on a nearby street. “Three-eleven, that guy, he’s wack,” he says, shaking his head. “He wants 2.8.” He means million dollars. “And then 354, they want $2 million.”

The lot is 17,000 square feet. “Seventeen for 2 mil?” Mark asks, incredulous.

“I know,” Ornelas says. “They’re going crazy.”

A year ago the property would have gone for $1.3 million, but Arcadia is booming. Residents have become used to postcards offering immediate, all-cash deals for their property and watching as 8,000-square-foot homes go up next door to their modest split levels. For buyers from mainland China, Arcadia offers excellent schools, large lots with lenient building codes, and a place to park their money beyond the reach of the Chinese government.

The city, population 57,600, projects that about 150 older homes—53 percent more than normal—will be torn down this year and replaced with mansions. The deals happen fast and are rarely listed publicly. Often, the first indication that a megahouse is coming next door is when the lawn turns brown. That means the neighbor has stopped watering and green construction netting is about to go up.

This flood of money, arriving from China despite strict currency controls, has helped the city build a $20 million high school performing arts center and the local Mercedes dealership expand. “Thank God for them coming over here,” says Peggy Fong Chen, a broker in Arcadia for many years. “They saved our recession.” The new residents are from China’s rising millionaire class—entrepreneurs who’ve made fortunes building railroads in Tibet, converting bioenergy in Beijing, and developing real estate in Chongqing. One co-owner of a $6.5 million house is a 19-year-old college student, the daughter of the chief executive of a company the state controls.

Read full story here:

http://www.businessweek.com/articles/2014-10-15/chinese-home-buying-binge-transforms-california-suburb-arcadia

Posted by on Oct 19, 2014 in Market Buzz, Market Conditions, The Future, This Is America | 4 comments