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Category Archive: ‘North County Coastal’

NSDCC August Sales

This may be a preliminary look, but there won’t be many more late reporters.  Agents are supposed to mark their sales closed within 48 hours, and we’re a week out.  But even considering the typical end-of-summer slowdown, it looks like sales are plunging.

Today, the MLS shows a paltry 234 detached-home sales last month, the lowest August total of the last four years:

Year
# of Sales
Median SP
Avg. $-per-sf
Avg. DOM
Aug ’09
215
$825,000
$373/sf
83
Aug ’10
210
$838,000
$389/sf
63
Aug ’11
240
$825,000
$389/sf
80
Aug ’12
298
$865,000
$381/sf
84
Aug ’13
324
$953,750
$437/sf
40
Jul ’14
268
$1,050,000
$490/sf
45
Aug ’14
234
$1,011,500
$450/sf
46

While we enjoyed some frenzy-like months during the 2014 selling season, it looks like we’re heading back to the far-more mundane pace of 3-5 years ago.

graph (50)

For sellers who tacked on an extra 5% to 10% to your list price:  If it doesn’t work, at least adjust downward fast enough that the urgency stays higher, and you beat the holidays – Halloween is only seven weeks away!

 

Posted by on Sep 8, 2014 in Jim's Take on the Market, North County Coastal, Sales and Price Check | 12 comments

Pricing By Zip

Isn’t it amazing that prices have kept rising without frenzy help?

We’ve had the frenzy hangover this year. Inventory is still tight, sellers confident, and buyers don’t have much choice except to pay what it takes – or to stand by.  But sales are softer – and the number of NSDCC active listings today is 7% higher than last year.

Here are the two pricing measurements for each zip code for detached-home sales between May 1st and July 31st.  Every zip code between Carlsbad and La Jolla shows a positive year-over-year increase in BOTH pricing metrics!

Town
Zip Code
Avg $/sf
Median SP
Cardiff
92007
$532/$582
$1.017/$1.075
Cbad NW
92008
$381/$434
$690,000/$721,000
Cbad SE
92009
$295/$316
$769,000/$831,000
Cbad NE
92010
$288/$321
$600,000/$668,500
Carlsbad SW
92011
$316/$347
$827,500/$855,000
Carmel Vly
92130
$373/$398
$1.025/$1.100
Del Mar
92014
$729/$805
$1.463/$1.630
Encinitas
92024
$427/$461
$860,000/$915,000
La Jolla
92037
$690/$742
$1.64/$1.75
RSF
67+91
$476/$502
$2.13/$2.27
Solana Bch
92075
$520/$733
$1.05/$1.56
NSDCC
All Above
$457/$513
$960,187/$1,010,000
NSDCC
% chg
+12%
+5%

I had to average the averages for the NSDCC $/sf, so they are probably high.

Rob Dawg said in his 2014 forecast that he thought we’d see all the annual gain happen in the first half of the year. It’s the post-frenzy soft landing!

Posted by on Aug 21, 2014 in Frenzy, North County Coastal, Why You Should List With Jim | 7 comments

Natalie Klinge

It was quite a day today, but hey, they’re all great days!  I think we are as busy as we’ve been all year, and for one reason.

Logic and common sense are returning to the market.

They are being fueled by Zillow and Trulia, because they are providing a baseline – some place to start the investigation.  Every person I meet has already looked at Zillow first!

Zillow is pouring it on too - they are spending $75 million this year on advertising!  I hear them every day on sports talk radio, and with all their headlines, they have become the household name for real estate.

What’s next for consumers?

I hope the combined effect of higher prices, thin inventory, and low rates causes more people – both buyers and sellers – to use the tools, and be more methodical about their decisions.  Work with agents who bring extra value – especially those who employ effective sales strategies.

When the frenzy was cooking, buyers just wanted to grab a house, and they fired at will.

Many of the prices paid didn’t have much relation to the easily-found comparable sales. But the gamble paid off – they are in, and have probably gained some equity.

But now that prices are up 20%, people are being more cautious and deliberate – which is a great sign for the future of the local market.

The logic setting in can be seen in our actitve-to-pending ratio:

NSDCC Detached-Homes (Carlsbad-La Jolla)

Price Range
Active Listings
Pending Listings
A/P Ratio
Under-$1M
260
164
1.6:1
Over-$1M
886
195
4.5:1

Make no mistake – the lower end is still on fire.  The higher-end folks tend to price their homes to sit.  There are 323 houses for sale listed over $3,000,000, and the average market time is 153 days (eating up the entire selling season and still not sold).

But forget the statistics.

Today was monumental for many due to the first day of school – and we are no different.  Kayla’s sister Natalie started her senior year of high school today, captain of the dance team and in charge of her destiny:

nat 2014

Posted by on Aug 18, 2014 in About Kayla, About the author, Actives/Pendings, Jim's Take on the Market, North County Coastal | 0 comments

Buy Now & Be Happy 2

There has been three categories of listings lately:

1. New listings that sell at or around list price the first week on the market.

2. Those that sell months later as price reductions finally intersect a rising market. In a slowing market (like we have now) pricing loses momentum quickly as buyers get more confident.

3. Those that don’t sell.

It’s going to get more obvious to sellers as showings slow to a crawl or less – if they want to sell this year, they need to lower their price. But hey, great news – those who are willing to sell for a price at the comps – or slightly under - should find takers.

Posted by on Aug 13, 2014 in Bubbleinfo TV, Market Conditions, North County Coastal | 0 comments

Buy Now & Be Happy

Mish suggested yesterday that the real estate market will end up the same as last time for many folks who are feeling pressured to buy now or be priced out forever.  He is probably right that there are buyers who don’t investigate enough and end up making bad decisions – get good help!

He was commenting on this Bloomberg article that cobbled together a bunch of unrelated quotes, and topped it off with the sexy headline:

http://www.bloomberg.com/news/2014-08-12/first-time-buyers-shut-out-of-expanding-u-s-home-supply.html

Locally the inventory has seen a dramatic change – here are the number of NSDCC houses listed under $900,000 in the first seven months of the year:

Year
# of New Listings Under $900K Jan-Jul
2010
4,186
2011
4,042
2012
3,245
2013
2,760
2014
1,011

It has definitely been tough on the lower-end buyers, with prices rising rapidly over the last two years.  But buyers would be crazy to compromise on location – buy a smaller house or fixer instead, or just wait and see what happens.

Potential buyers who haven’t bought by now are exhausted. As soon as school starts, and the Chargers begin their Super Bowl run, buyers will have plenty of distractions, and demand will be visibly reduced.  There will be sellers who need to sell that will be disguised as over-priced turkeys too – make offers!

Reader elbarcosr left this comment:

And I am not sure anyone is yelling the buy now or be priced out forever bs anymore.  I *think* the prevailing wisdom is that with the gains over the last 24 months or so, prices are back to where they should be more or less, and given all the other factors, huge gains or dips are not really in the cards.  So if you want to buy a house to live in, go for it.  Speculating on big short-term price appreciation at this point is folly — as is waiting for a big dip in prices.  Put 20% down, grab your 4% 30 year fixed loan, and be happy.

Posted by on Aug 13, 2014 in Inventory, Jim's Take on the Market, North County Coastal | 8 comments

The Market is Great

SD Case Shiller graph

We’ve seen the local San Diego Case-Shiller Index rise from 144.43 in April, 2009 to the most recent reading of 201.85 in May, 2014.

A whopping 40% increase in just five years.  What a ride!

Yet all we hear from the media is that the housing market is faltering, sales are down, and soon the sky will be falling.  Here are the reasons why it won’t:

1. Even though prices are much higher, there hasn’t been a flood of inventory.  Consider how many sources of inventory that you’d expect to be flooding the market; bank-owned properties, flippers, previously-underwater homeowners, the elderly, etc.

Not only has there not been a flood, but around NSDCC there have been 3% FEWER houses listed in the first seven months of this year than in 2013.

2.  Rates are Holding.  Though sales and prices would probably be affected if mortgage rates did go up, so far they are steady – in spite of wars, improved employment, ebola, etc.  Buyers will live with rates in the fours, and I just had a 30-year jumbo rate quote in the high-3s.

3.  There is lots of activity. The house in yesterday’s article whose broker said she is having no showings must be ridiculously over-priced, because the attractive buys are getting action.  Any seller who could live with 5% to 10% less than the list prices of active (unsold) listings nearby won’t have any trouble selling today.  If prices in general did pull back, it would stimulate a new round of sales – the buyers who feel priced out would love another chance.

4.  No Frenzy Means More Caution.  After prices go up 40%, it’s a lot easier to make a mistake, and buyers are being more selective. A smart market is a healthy market.

The next few months are going to be terrible for sellers who insist on tacking on another 10% or so on top of what we’ve already gained.  But reasonable sellers will have no trouble selling – the market is fine.

Posted by on Aug 6, 2014 in Jim's Take on the Market, Market Buzz, Market Conditions, North County Coastal | 5 comments

Slowing Sales

We are still getting reports that year-over-year sales are declining, and that means something is wrong or bad.  Below they are comparing the counts to last year’s frenzy numbers and are crying wolf.  But what do you expect when the frenzy is over?

Our local stats look great – this year NSDCC has about the same number of July sales as we did two years ago, when prices were 20% lower (some late-reporters still coming too).

NSDCC Sales, July
# of Det. Home Sales
Median Sales Price
2001
291
$575,000
2002
347
$640,000
2003
430
$745,000
2004
351
$975,000
2005
281
$1,045,000
2006
220
$1,006,000
2007
255
$1,050,000
2008
222
$898,000
2009
237
$800,250
2010
223
$833,000
2011
231
$825,000
2012
258
$850,000
2013
297
$930,000
2014
250
$1,017,500

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

From the U-T:

http://www.utsandiego.com/news/2014/aug/03/housing-market-flashes-caution/

Persistent sales slowdown keeps the local recovery fragile, raising odds of relapse

A time-tested signal of weakness in the housing market is flashing yellow.

When you compare the number of home sales (which are highly seasonal) with those from the same month a year earlier, this key measure has declined in San Diego County for nine consecutive months through June — with five at double-digit rates.

Statewide trends are similar, with 11 straight months of year-over-year sales declines, according to the latest figures from DataQuick, a company that tracks transactions reported to county governments.

“My sellers are in complete shock. We’re getting no calls, no inquiries. It’s like the market just went away,” said Kimberly Dotseth, a San Diego real estate broker. “Buyers think prices are too high.”

An exception is the lower-priced segment of the market, where homes listed for $400,000 or less are still receiving multiple offers and quick sales. This supports the view that high price might be a primary factor discouraging many sales, rather than other factors such as tough lending standards or too few homes on the market.

In the history of housing markets, downturns typically have begun with sales weakness that sometimes ended up forcing down prices, but not always.

This holds back the wider economy, even if home prices don’t fall in the near future — as they have twice since 2006. That’s because low sales activity reduces a giant source of spending for remodeling, decorating and new construction.

Given the trauma of the last decade, the condition of the local housing market is a serious subject.

Read the full article here:

http://www.utsandiego.com/news/2014/aug/03/housing-market-flashes-caution/

Posted by on Aug 5, 2014 in Jim's Take on the Market, Market Conditions, North County Coastal, Sales and Price Check | 2 comments

Market Bifurcation

la jolla sunset1

The homes in the north coastal region from La Jolla to Carlsbad have always been relatively expensive.

Of the 1,052 houses for sale today, 81% of them are priced over $1,000,000.

(Take Carlsbad out, and 92% are priced over $1,000,000).

But only 51% of the 1,233 NSDCC house sales closed this year have been $1M+.

It gives us about a 7.5-month supply of homes for sale priced OVER $1,000,000, and a 1.8-month supply of homes priced UNDER $1,000,000.

Whether you are buying or selling, get good help!

Posted by on Jun 18, 2014 in North County Coastal, Sales and Price Check | 2 comments

More on NSDCC May Sales

sales drop first

Here’s more data on last month’s detached-home sales around North SD County’s coastal region.

The new MLS doesn’t have the same statistics available, but for some reason it is crazy about reporting the sales volume everywhere, for which the average realtor has no use.

But comparing the sales volume does help show why this year feels so much different than last year for realtors, and others in the business whose income is based on a percentage.  Even though yesterday’s average pricing was up 13% year-over-year, the overall sales volume was down 33% from May, 2013:

NSDCC May Sales:

Year
# of Sales
Median SP
Total Sales Volume
2010
249
$800,000
$254,103,668
2011
243
$850,000
$276,818,522
2012
289
$821,000
$320,086,154
2013
362
$943,500
$441,162,967
2014
251
$950,000
$296,845,249

The market has shifted from distressed properties to a Make-Me-Move environment, which buyers were willing to endure last year when prices AND rates were substantially less.

The number of new listings this year is about 4% fewer than last year, but as you can tell by the drop in sales – it is different now.  Only the sellers who are willing to offer an attractive value are selling. Get good help!

Posted by on Jun 6, 2014 in Jim's Take on the Market, Market Conditions, North County Coastal, Sales and Price Check, Why You Should List With Jim | 0 comments