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

Category Archive: ‘Market Conditions’

Jim in Business Insider in 2014

This was published on April, 2, 2014. The SD Case-Shiller is 28% higher today than it was then, and the trading hasn’t thinned out much, at least not yet.  We had 2,850 NSDCC sales in 2014, and 2,801 last year:

Below is a Q&A with Jim Klinge, the head of San Diego-based Klinge Realty and the creator of, a realty blog.

BUSINESS INSIDER: What is the most underreported story in housing? 

JIM KLINGE: The health of the real estate market. We’re back to peak pricing – and higher – around coastal San Diego during the toughest mortgage underwriting in the history of the world.

BI: What is the biggest change you’ve seen since the bust in terms of the typical buyers’ profile?

JK: No change – almost all are owner-occupants.  Surprisingly, having direct access to recent sales via the internet hasn’t made buyers more critical about price.  Over the last 12 months, it’s been the opposite – people are paying prices that are 5% to 10% higher than recent sales.  Because they are so familiar with the values, you’d think they would be more discerning, but the fear of loss supersedes all – they just want to buy a house, and are tired of losing.

BI: What is the biggest mistake buyers are making these days?

JK: Not researching realtors. They think we’re all the same, so they just grab one.

BI: What is the biggest mistake sellers are making these days?

JK: Not researching realtors.  Many just grab the one who mails them the most propaganda.

BI: How much higher can the Sun Belt markets climb?

JK: The prime markets could easily rise another 10% to 20%, price-wise, in the next 2-3 years.  But it will be on very thin trading, which makes you question how legit it is, and whether it will sustain.

Click here and scroll down for text:

Posted by on Jan 21, 2019 in About the author, Jim's Take on the Market, Market Conditions | 0 comments

Due for a Surge?

Does weather affect home sales?

Yes, buyers don’t mind the distraction when the market is uncertain!

But now that the holidays are over, the Chargers are done, more houses are coming to market, and mortgage rates are a half-point lower than they were three months ago, we are (over)due for a surge of activity.

There are two big NFL games on Sunday afternoon, which leaves Saturday wide open – and it has the best weather of the week.

No big games the following weekend, so if the weather holds out, buyers should be fully engaged – and if they aren’t, then that says something too.

It’s hard enough just trying to sell – if you have to schedule around the weather and other conflicts (graduations, for example), it narrows down the chances even more.  But if we can anticipate opportunities, let’s take advantage.

Posted by on Jan 14, 2019 in Interest Rates/Loan Limits, Jim's Take on the Market, Market Conditions, Market Surge | 1 comment

More Contingent Sales in 2019

While some folks can’t make sense of a move up or down, there are others who have specific wants/needs, and are willing to forge ahead – if they can just sell their existing home and pour their equity into the next one.

I’m three for three this year with contingent sales already, and I wouldn’t be surprised if half of my sales in 2019 will involve contingent buyers.

The challenge gets more complex when multiple sales are contingent!  They stack up like dominoes, all dependent on sales on either side to be completed successfully – and risk all crashing if a problem pops up that can’t be solved.

Up to now, listing agents and sellers haven’t had to deal with contingent buyers because we’ve had enough non-contingent buyers to go around.  Not any more.

The #1 reason sellers and listing agents should consider a contingent offer?

Contingent buyers pay more.

They know they are asking a favor, and in effect, they are purchasing a favor.

Plus, their purchase is contingent upon them selling their house (read: getting the price they want), so everybody gets what they want. Win-win!

Contingent sales can be highly speculative, however, and our existing system doesn’t provide a safety net, so there is a risk that every seller could get left holding the bag.

How can we tighten these up?

  1. Have buyers obtain full loan approval.  At least if the buyers are fully approved by the mortgage underwriter, that concern is satisfied.  A pre-qual letter isn’t solid enough to tie up a property.
  2. Review the lender downstream.  If there is a chain of contingent sales domino-ed together, let’s take a good look at everyone’s lender letter – because we’re all in it together.
  3. Review the agents downstream.  Is everyone competent? If my sale is reliant upon an agent downstream finding and solving problems, then it’s not asking too much to know who it is.  What else have they sold lately?
  4. Supply comps and photos of contingent properties. Every agent involved should know – and get to render their opinion – on the price/value of the other homes in line.
  5. Bridge loans. Bridge loans are out there, and Compass should have a good alternative ready before too long. A fantastic option that solves everything.

There is another viable alternative that every contingent-buyer should consider: Selling your home first.  The immediate reaction is usually the same – I don’t want to be left homeless, or I don’t want to have to move twice, which is understandable.

But we do have the seller contingency that allows us to find a suitable buyer for your home while not binding the seller to move until they find suitable housing:

Our ability to master the contingent sale will probably make or break the market this year.  Without them, will there be enough buyers with the equity, desire, and ability to keep the party going?  It’s doubtful.

Most realtors, let alone buyers and sellers, are unfamiliar with contingent sales.  But this is where our creativity will pay off in a challenging market!

Posted by on Jan 12, 2019 in Jim's Take on the Market, Market Conditions, Realtor, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 3 comments

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.

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

Padres Contest

Big Papi’s last game in SD

Would you like some guidance on what to expect in the Spring Selling Season?

Let’s monitor how many new NSDCC listings are hitting the market!

If the negative media hype is starting to worry sellers, they will hurry up and list their home early.  If we see a surge of new listings in the first two months of the year, it means a buyers’ market is forming.

If we have about the same or fewer listings in early 2019, then sellers will just shrug off any concerns and wait their turn.

Here are the counts of listings inputted onto the MLS in January and February from the last few years:

NSDCC New Listings, Jan & Feb

Jan+Feb Listings
Median List Price
Median DOM

The average is 813 listings, and with the last two years both being lower, it would take a significant YoY increase to worry most participants. But at least we’ll know first!

Put your guess in the comment section of how many new listings we’ll have in January and February, and on March 15th we’ll see who is closest.

The winner will get four tickets to a Padres game! The photos here were taken from the seats, and I’ll have about ten dates available.

Larry Baer, CEO of the SF Giants

Posted by on Jan 2, 2019 in Contests, Inventory, Jim's Take on the Market, Market Conditions, North County Coastal | 27 comments


Expect more “unexpected” data, and constant Yunnie cheerleading in 2019:

Contracts to buy previously owned homes fell unexpectedly in November, the National Association of Realtors said on Friday, the latest sign of weakness in the U.S. housing market.

The NAR’s pending home sales index decreased 0.7 percent from the prior month to 101.4. October’s index was unrevised.

Economists polled by Reuters had forecast pending home sales to rise 0.7 percent last month.

Pending home contracts are seen as a forward-looking indicator of the health of the housing market because they become sales one to two months later.

Compared to one year ago, pending sales were down 7.7 percent in November, the eleventh straight year-over-year drop.

The housing market has been constrained by higher mortgage rates as well as land and labor shortages, which have led to tight inventory. Though house price inflation has slowed significantly, it continues to outpace wage growth, sidelining some first-time homebuyers.

The NAR previously reported that home resales rose in November, but recorded their biggest annual decline in 7-1/2 years.

Groundbreaking for new homes also rebounded in November, but completions on single-family homes fell for a third straight month to their lowest level in more than a year.

Lawrence Yun, the NAR’s chief economist, said in a statement on Friday that the pending home sales data was not yet reflecting recent favorable mortgage rate conditions.

Link to Article

Posted by on Dec 28, 2018 in Jim's Take on the Market, Market Conditions | 2 comments

Remember the Struggle?

The Chargers – still euphoric from having 7 of their players make the Pro Bowl – lost badly last night, and that should doom the rest of their Cinderella season.  They will probably end up in Pittsburgh or New England for their playoff game, and have a premature ending to their Super Bowl run – and eliminate a potential distraction for our early-2019 housing market.

The stock market should level out early in the new year, after causing mortgage rates to dip into the low-4s, which will be good news too.

All we need is some well-priced inventory, and off we go!

Except for one thing – will sellers and agents remember the Struggle of 2018?

The holidays always provide a nice distraction for all, and help to put some distance between our previously sluggish market conditions and the clean slate of a new year.

We can predict the usual occurrence:

  1. The Top 30% of listings will have no trouble selling.  They are in excellent condition and are priced fairly.
  2. The Bottom 40% of listings won’t sell.  It happens like that every year.

It’s the Middle 30% that will determine the fate of the selling season of 2019.

The jitters in the stock market should translate over to real estate, and nervous home-sellers will be listing earlier than ever.  We’ll probably have a new record high for January listings – which should set buyers back on their heels even more as they wonder who is going to go first.

The Top 30% of listings will be fine and orderly.  It will be how the Middle 30% decide their pricing – are sellers nervous enough that they will resist adding a little cushion to their list price?

No way – the sluggishness of 2018 will be a distant memory, if remembered at all. The higher comps of 6-18 months ago will be used to justify retail-plus pricing, just like always.

There will be mixed messages because those in the Top 30% that sell briskly will make potential sellers think everything is fine again.  But if we see unsold listings are starting to pile up by May/June, it will become obvious to buyers that the Middle 30% needs to adjust their pricing radically if they want to sell.

Sellers should get it done early, before it becomes obvious. The sluggishness started in July this year, and it will probably be back earlier in 2019.

Get Good Help!

Posted by on Dec 23, 2018 in Forecasts, Jim's Take on the Market, Market Conditions | 8 comments