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Are you looking for an experienced agent to help you buy or sell a home? Contact Jim the Realtor!

Carlsbad
(760) 434-5000

Carmel Valley
(858) 560-7700
jim@jimklinge.com


Category Archive: ‘North County Coastal’

Faster and Higher

Realtors including myself say that we have “low inventory”, but it’s not because fewer sellers are listing – it’s because the heavy demand is gobbling them up faster, and at higher prices:

NSDCC Listings and Sales between Jan 1 and May 15

Year
Total Listings
Sales
Avg $$/sf
Avg DOM
2009
2,163
596
$399/sf
71
2010
2,167
837
$380/sf
73
2011
2,266
891
$374/sf
82
2012
1,910
991
$374/sf
84
2013
2,057
1,118
$405/sf
49

The sales amounted to only a quarter of the total listings in 2009, and this year they are half!

We know that the higher-end market is sluggish at best (there are 713 active listings over $1M). Here’s a look at the UNDER-$1,000,000 markets:

NSDCC UNDER-$1,000,000 – Actives and Pendings/Contingents

City or Area
#Actives
#Pend/Cont
Carlsbad
115
186
Carmel Vly
28
51
Del Mar/SB
6
11
Encinitas
19
59
La Jolla
10
9
RSF
1
3
Totals
179
319

On the street, it feels like the frenzy is slowing.  But until the ACT/PEND ratios get closer to a more normal 2:1 (or at least 1:1), the UNDER-$1,000,000 market will continue to be very competitive.

The lowball season usually starts in June, but there are only 23 active listings under $1,000,000 that have been listed for more than 60 days (out of 184)!

Posted by on May 21, 2013 in Actives/Pendings, Average DOM, Frenzy, Market Conditions, North County Coastal | 1 comment

Inventory – Frenzy Watch

Looking for a break in the frenzy? Keep an eye on the active inventory.

We’ve considered a 2:1 ratio to be a sign of a healthy market.

Since April 29th, the UNDER-$1.2 market has stayed red hot with 87 new listings and 78 new pendings (1.16:1), and the OVER-$1.2 market has been steady with 70 new listings and 43 pendings (1.63:1).

If you see any shift here, then the frenzy may be eroding:

The UNDER-$1,200,000 Market:

Date NSDCC Active Listings Avg. LP/sf DOM Avg SF
April 29
201
$384/sf
36
2,599sf
May 5
195
$381/sf
36
2,633sf
May 9
207
$387/sf
35
2,624sf

The OVER-$1,200,000 Market:

Date NSDCC Active Listings Avg. LP/sf DOM Avg SF
April 29
620
$806/sf
94
5,183sf
May 5
606
$806/sf
93
5,223sf
May 9
628
$808/sf
93
5,150sf

It will take a steady build-up of unsold homes to derail this train – and it’s unlikely that buyers will surrender. Expect more thrills in the near future!

wildride

Posted by on May 9, 2013 in Frenzy, Inventory, North County Coastal | 8 comments

Getting Priced Out

Prices are moving up rapidly on the lower-end of each market.

People complain that there is no inventory, but part of the reason is that sellers are pricing much higher. Buyers in the mid-to-higher-end of each market will get a smaller house or yard, but those on the lower-end are quickly getting priced out altogether.

Here are the number of detached homes sold in the last 12 months, and the number of active listings today:

Town and Price Point #Closed last 12 mo. #ACT Listings
Oceanside Under $300K
417
5
Carlsbad Under $600K
445
7
Encinitas Under $700K
186
7
Carmel Vly Under $900K
263
11
La Jolla Under $1.1M
118
10

Where it stops nobody knows, but you can expect the bidding-war intensity to be extremely hot on the lower-ends of each market.

Posted by on May 3, 2013 in Bidding Wars, Frenzy, Inventory, Market Buzz, Market Conditions, North County Coastal | 19 comments

Comparing to the Last Peak

How are we doing, compared to the ‘peak’ years?

To capture the latest frenzy, let’s use the March 1st to April 30th period, and reflect back to see how the numbers stack up compared to previous years:

graph (23)

Today, both sales and pricing are increasing at the same time - similar to the 2003-2004 era, which was the hottest market in recorded history.

This year we had the fourth-highest sales count, and an average cost-per-sf similar to 2004.  Average pricing is only 14% behind the peak year of 2006!

With sales being a leading indicator, it appears that pricing should continue to climb.

For those who prefer a bar graph, here are the same numbers:

graph (24)

Posted by on May 2, 2013 in Graphs of Market Indicators, North County Coastal, Sales and Price Check | 4 comments

Inventory Watch – Split Market

Here is our regular NSDCC inventory watch:

Date NSDCC Active Listings Avg. LP $$/sf
Jan 14
649
$722/sf
Feb 4
667
$716/sf
Feb 10
679
$713/sf
Feb 25
678
$719/sf
March 6
727
$703/sf
March 11
744
$698/sf
March 16
746
$703/sf
March 23
755
$712/sf
March 31
752
$717/sf
April 5
780
$704/sf
April 11
780
$710/sf
April 17
792
$699/sf
April 22
802
$698/sf
April 29
812
$706/sf

Not much change, but it is deceiving because of the split market. Of the 812 active listings, 67% of them are over $1,500,000 – no wonder the numbers aren’t moving much. Here is the split:

The UNDER-$1,200,000 Market:

Date NSDCC Active Listings Avg. LP/sf DOM Avg SF
April 29
201
$384/sf
36
2,599sf

The OVER-$1,200,000 Market:

Date NSDCC Active Listings Avg. LP/sf DOM Avg SF
April 29
620
$806/sf
94
5,183sf

There is the usual mantra; “more expensive properties take longer to sell”, but in reality those sellers just wait for someone to come along.

Buyers in the upper ranges need to proceed cautiously – look at how many choices there are!

Posted by on Apr 29, 2013 in Inventory, North County Coastal | 3 comments

Home Prices – How High?

Our reader Stormin sent in this link to a guy who he has followed for years and says he is solid:

http://dailytradealert.com/2013/04/24/you-still-havent-missed-out-on-this-incredible-opportunity/

Here is an excerpt:

“I believe house prices in America will soar beyond what anyone can imagine.”

He’s not putting a price or percentage on it, so take it with a grain of salt.

But when we are already seeing local prices getting back to – or above - the peak levels, it does make you scratch your head.

How high could our local real estate prices go?

Here is my wild guess.

In boom years, home appreciation averages around 1% per month – and in the craziest year of all, 2003, prices went up 2% per month (I’m using round numbers).

This year will be our 2003, and NSDCC detached homes will see rampant appreciation at our current pace – let’s call it 2% per month.

Amazingly, today’s cash buyers don’t seem to care about recent sales, and don’t mind paying wildly above comps – and I see it everywhere.  This will contribute greatly to the 2% per month appreciation this year.

We need to satisfy the demand of all the rich people first – they are at the front of the line, and until they get all the real estate they can handle, the financed buyers will have to wait around.

But we should hit a point in June/July where it becomes obvious that the market is totally out of control.  The evidence will be the glut forming of over-priced turkeys whose owners still think we’re in the selling season and their lucky sale is right around the corner so they refuse to lower their price.

The ego of cash buyers will start demanding better deals, and when spoiled sellers don’t comply, it will open the door for financed buyers who will jump at the chance to get in the game.  Hence, the 2% per month lasts all year as more financed deals filter in.

Once we get into 2014, the Fed starts backing off the QE-Forever, and banks will start rasiing mortgage rates whether the market demands it or not.

Financed buyers go crazy at the thought of losing their bragging rights around the barbeque about getting the lowest rate, and the frenzy stays hot for another year – but at the 1% per month rate because it is already built on top of the previous year’s 2% per month.

By the time we get to 2015, exhaustion is setting in – both physically and financially – and more sellers are rushing to market.  Let’s cut it back to 0.5% per month.

2013 = 24%

2014 = 12%

2015 = 6%

Total = 42% above 2012 pricing.

That’s the maximum – is that beyond what anyone could imagine?

Posted by on Apr 25, 2013 in About the author, Forecasts, North County Coastal | 15 comments

Overview

The new Alta Del Mar neighborhood in Carmel Valley is providing some guidance for the rest of San Diego’s North County Coastal region.

There are 100+ people on the ADM lender-pre-approved list to pay $2,000,000 to $2,500,000 for semi-custom tract houses.  Those on the list will get sorted out as Pardee drips out a few houses here and there over the next 2-3 years. In the meantime, they are still shopping around.

Here’s what they see:

All the other 92130 tract houses are cozying up under $2,000,000, with virtually no houses left under $1,000,000.  After holding steady at around $330/sf for the last few years, the Carmel Valley detached homes closed this year are already averaging $350/sf, and screaming higher.  The average list price of pendings is $378/sf, and not many sellers have to settle for less.

Those in Del Mar proper feel mighty superior to that inland Alta Del Mar, plus they don’t appreciate them stealing the tony Del Mar name – and obviously someone must pay. Virtually everything west of Crest Rd. starts around $2.5 million now.  Same for those sellers west of Nardo in Solana Beach.

La Jolla and Rancho Santa Fe?  If you want a good-quality estate in either town, expect to pony up $3,000,000+, and most everything under $2,000,000 needs work.

Cardiff, Encinitas, and Carlsbad offer some relief price-wise, but anything decent flies off the market quickly.  The 92024 solds are averaging $394/sf this year, and Carlsbad’s 92011 solds are $319/sf, both 10% higher than last year’s average.

Posted by on Apr 21, 2013 in Bubbleinfo TV, Del Mar, North County Coastal, Sales and Price Check | 1 comment

When-To-Sell Indicators

For the daredevil sellers who recognize that this is an ideal time to sell, yet want to wait and see if the market will goose itself higher, what are the indicators to watch?

1. We’ve been tracking the NSDCC active inventory this year, and it hasn’t been growing much – the new listings that are coming on the market are being matched by new pendings. If the active inventory starts to grow, then we know that buyers are hesitating about the pricing.

2. The average-days-on-market is your buyer-desperation index.  How quickly are homes flying off the market?

graph (17)

We have ramped up to warp speed currently, but if this starts to falter, you know that buyers are catching their breath about the pricing.

3.  The number of sales is a great leading indicator, but their close date is actually 30-60 days past the decision date.  New pendings aren’t that reliable either because they can fall-out.

Let’s just compare sales to the same average-days-on-market, and call the difference the desperation gap:

graph (18)

Sales are remarkably higher, and the average DOM is dropping sharply.

Let’s call the current condition the full-tilt boogie!

On a side note, it is refreshing to see that open houses – once the scorn of realtors who thought they were good for nothing – are now being utilized as the most effective way to expose a new listing to the market.

As my Dad would say, “Well, I’ll be darned!”.

Posted by on Apr 13, 2013 in Average DOM, Fraud, Market Buzz, Market Conditions, North County Coastal, Sales and Price Check | 3 comments