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An Insider's Guide to North San Diego County's Coastal Real Estate
Jim Klinge, broker-associate
858-997-3801
klingerealty@gmail.com
Compass
617 Saxony Place, Suite 101
Encinitas, CA 92024
Klinge Realty
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Are you looking for an experienced agent to help you buy or sell a home? Contact Jim the Realtor!

Jim Klinge
Cell/Text: (858) 997-3801
klingerealty@gmail.com
701 Palomar Airport Road, Suite 300
Carlsbad, CA 92011


Category Archive: ‘Sales and Price Check’

Home Sales 2019

The pundits are chiming in on their housing expectations for next year, and the opinions revolve around one topic:  Higher mortgage rates are changing things.

Here are two experts who don’t think the number of sales will change much:

“As we look toward 2019, we are anticipating home sales to decline around 2%. We’re expecting it to be another slightly slower year as buyers continue to wrangle with higher mortgage rates after contending with several years of rapid price growth.” — Ruben Gonzalez, chief economist at Keller Williams

“We’re going to have the same number of transactions, but…rates are going to nudge up to 5 percent; market times are going to expand out to 30 days. You’ll have to have a different set of skills.” – Brian Buffini

For sales to stay the same, then buyers will have to agree that the sellers’ prices are about right. Will sellers list their homes attractively enough, especially early in the selling season?

Or is it more likely that they will add a little mustard to their price in spring, just because they’re not going to give it away?

I want to compare a full 12-month history to prior years, so let’s examine the December 1st to November 30th period – let’s have history guide us:

NSDCC Detached-Home Sales

Year
NSDCC Sales, Dec 1 – May 31
NSDCC Sales, Jun 1 – Nov 30
2013
1,631
1,670
2014
1,319
1,492
2015
1,463
1,608
2016
1,470
1,651
2017
1,466
1,636
2018
1,339
1,484

The 2018 sales are similar to those in 2014, which happens to be the last time rates had popped up 1%.

But then the rates started declining right away, and by the end of 2014 they were back in the 3s, which powered the strong sales between 2015-2017:

(click to enlarge)

But today, rates are much higher – and so are prices:

Something has to give, doesn’t it?

Sellers aren’t going to bend much on price, especially early in 2018 – they won’t believe their prices are wrong until they try them out for months, and maybe longer.

So if most buyers wait-and-see, then sales have to give.

I’m sticking with my prediction that 2019 NSDCC sales will drop 20%, YoY.

Posted by on Dec 7, 2018 in Forecasts, Jim's Take on the Market, Sales and Price Check | 0 comments

NSDCC November Sales

The slowdown started in July, so the November sales count is surely going to reflect the impact – and it does. Sales were down 11% year-over-year:

Year
# of Sales
Median SP
Avg. Cost-per-sf
Avg. DOM
Avg. SF
S/BD*
2013
187
$1,030,000
$474/sf
58
2,960sf
10.4
2014
173
$985,000
$489/sf
63
3,071sf
10.2
2015
196
$1,173,750
$518/sf
54
3,067sf
10.9
2016
244
$1,235,908
$531/sf
51
3,046sf
12.8
2017
218
$1,200,305
$522/sf
46
3,093sf
11.5
2018
194
$1,310,000
$568/sf
55
3,067sf
10.2

*S/BD = Sales per business day, which had the same -11% YoY decline.

Let’s put away the panic button for now.

Posted by on Dec 6, 2018 in Jim's Take on the Market, North County Coastal, Sales and Price Check | 0 comments

November Panic?

If sellers were feeling a sense of panic about the market – and prices – we would be seeing more new listings hit the market.

Let’s boil it down to one simple comparison.

Are there more listings than usual coming to market?

NSDCC Listings, November

Year
November Listings
Median List Price
# Sold
Percentage Sold
2013
223
$1,159,000
137
61%
2014
267
$1,199,000
167
63%
2015
299
$1,399,000
163
55%
2016
284
$1,354,999
163
57%
2017
252
$1,600,000
162
64%
2018
292
$1,499,500

I wouldn’t be too concerned about the median list price being lower. The list prices don’t mean much, and if it weren’t for an extra 13 lower-end listings then the 2018 median LP would have matched last year’s.

More listings, longer market times, and higher failure rates are in our future – and we can handle it!

There have already been ten listings from last month close escrow – five were sold off-market – and another 54 are pending, so somebody’s buying something. Here are three examples:

1. This 2-br house sold for $1,400,000 in March, 2018, and then was advertised as a Coming Soon for $1,695,000. It closed for $1,650,000 a month ago:

Link to Listing

2. Amy and Susan sold this CV house for $51,000 over list, and closed this week:

Link to Listing

3. This Cardiff house backs to the freeway but it does have ocean view – it just closed this week for $1,950,000, which was above the high-end of the range:

Link to Listing

Here is the sales history of the same house:

If sales dropped 20%, we’d still have 80%!

Posted by on Dec 5, 2018 in Coming Soon, Jim's Take on the Market, North County Coastal, Sales and Price Check | 0 comments

October Sales in San Diego County

October sales in San Diego County were down 12% year-over-year, and the freefall should continue.  While the experts will keep pointing to housing being not as affordable now that rates and prices are up (this article states that the median-priced San Diego home in October costs an additional $321 per month this year), the plummeting sales can also be attributed to sellers being comfortable waiting for that perfect couple with 2.2 kids to come along.

This article also mentions that the current inventory is 46% higher than it was last year, but on the MLS the total number of 2018 listings for the county is only up 8% YoY, which demonstrates more standoff conditions – sellers are waiting and listings are stacking up.

Add the buyers’ unaffordability to lowly-motivated sellers and we have the perfect ingredients for standoff stew.

From the U-T:

In October, the median home price was $558,000, down by $25,000 from the all-time peak reached in August, but still up 5.4 percent for the year. Sales were down 12 percent compared to the same time last year and at their lowest level since 2011. There were 3,162 home sales in October, down from 3,592 in 2017, 3,597 in 2016 and 3,356 in 2015.

“I think the boom is over,” said financial analyst Rich Toscano, who predicted the housing crash in November 2005 on his housing blog Professor Piggington’s Econo-Almanac.

Read More

Posted by on Dec 1, 2018 in Jim's Take on the Market, Market Conditions, Sales and Price Check, Slowdown | 2 comments

Selling Early

Earlier we saw how a fresh new listing gets more traffic, and that buyer interest dies off quickly:

http://www.bubbleinfo.com/2018/11/02/selling-your-home-in-2019/

Yet historically about 3/4s of the sellers insist on testing the market for weeks or months, just to make sure. Buyers don’t mind waiting, because they usually get a better price when they do.

Realtors get criticized for just wanting a quick sale, but the data shows that selling earlier in the listing period means getting closer to the list price.

The first group here are those houses that sold during their first 10 days on the market, and the second group are those that sold after 11+ days:

NSDCC detached-homes sold between September 1st and October 31st:

Year
#Sales DOM 10-
Avg SP:LP
Med SP:LP
#Sales DOM 11+
Avg SP:LP
Med SP:LP
2014
114
99%
97%
366
93%
96%
2015
115
99%
100%
356
95%
98%
2016
148
98%
101%
390
93%
96%
2017
141
99%
101%
377
95%
99%
2018
115
97%
100%
327
94%
97%

Buyers are demanding a slightly larger discount today, plus sales are also down 15% YoY so a few sellers aren’t budging – but they’re not selling either.

It’s probably never been so important to be sharp on price. Just don’t add any extra mustard!

Posted by on Nov 16, 2018 in Jim's Take on the Market, Listing Agent Practices, Sales and Price Check, Why You Should List With Jim | 3 comments

NSDCC Monthly Sales History

Yesterday we heard the ‘stunning’ news that September sales dropped 13% year-over-year in Southern California.  What about locally?

There were 208 detached-home sales between La Jolla and Carlsbad this year, which was 20% below September, 2017. But once you factor in the extra business day, it was really -12%, which isn’t outrageous.

The sales and pricing stats will be more bouncy now that we’re pulling into Stagnant City.  We already had two other months this year (May and June) that had -20% sales YoY, and we bounced right back and had more sales the next month (July was 271 vs 260) and about the same in August (275 vs 279).

The NSDCC sales last month (Happy November!) have already matched those in 2015, and once the full count is in, should be close to those in 2017 (we did have an extra day this year). I bet that won’t make the doom-doom report!

Posted by on Nov 1, 2018 in Jim's Take on the Market, North County Coastal, Sales and Price Check | 1 comment

NSDCC September Sales

Our NSDCC sales in May and June were down 20% each, but then we bounced back in July and August to match the sales from 2017.

But the sales last month were disappointing (down 20% again):

NSDCC September Sales

Year
# of Sales
Avg $$/sf
Median SP
Median DOM
2013
263
$470/sf
$1,110,000
30
2014
236
$480/sf
$1,091,000
29
2015
251
$472/sf
$1,059,000
31
2016
264
$515/sf
$1,179,250
24
2017
259
$533/sf
$1,265,000
25
2018
207
$580/sf
$1,320,000
21

The whole region is following the example set in Rancho Santa Fe, where sellers wait patiently for months or years before the market catches up with them.

We can say our market has been “Rancho-ed”.

Posted by on Oct 16, 2018 in Jim's Take on the Market, Market Conditions, North County Coastal, Sales and Price Check | 1 comment

Growing Inventory

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.

Posted by on Oct 6, 2018 in Inventory, Jim's Take on the Market, Market Conditions, Sales and Price Check | 21 comments

Local Home Sales, YTD

The California Association of Realtors predicted that statewide sales in 2018 would increase 1%, and the California median sales price would rise 4.2%.

My guess was for the San Diego County detached-home sales to drop 5%, and the median sales price to rise 5% in 2018. How are we doing?

Here are the detached-home sales and median price for the first nine months of the year in San Diego County:

SD County Detached-Home Sales, January through September

Year
Number of Sales
YoY Change
Median SP
YoY Change
2012
18,648
$375,000
2013
19,385
+4%
$450,804
+20%
2014
16,858
-13%
$497,250
+10%
2015
18,389
+9%
$527,000
+6%
2016
18,192
-1%
$555,000
+5%
2017
18,068
-1%
$600,000
+8%
2018
16,413
-9%
$641,000
+7%

It may seem like the sky is falling, but we should just appreciate how great we’ve had it over the last few years, and accept that we’re going to have fewer sales from now on. Here are the stats for La Jolla-to-Carlsbad:

NSDCC Detached-Home Sales, January through September

Year
Number of Sales
YoY Change
Median SP
YoY Change
2012
2,322
$825,000
2013
2,554
+10%
$945,000
+15%
2014
2,183
-15%
$1,028,564
+9%
2015
2,405
+10%
$1,085,000
+6%
2016
2,345
-2%
$1,165,000
+7%
2017
2,385
+2%
$1,230,000
+6%
2018
2,161
-9%
$1,320,000
+7%

It’s going to be harder to sell your home.

Get Good Help!

Posted by on Oct 3, 2018 in Forecasts, Jim's Take on the Market, North County Coastal, Sales and Price Check | 2 comments

Usual Seasonal Change, or Panic Time?

Rob Dawg predicted it that any and all appreciation will happen in the first half of the year – and if we’re just talking about the general trends in local San Diego pricing, that’s how it has been lately.

As the red circles show in the graph above, the non-seasonally-adjusted SD Case-Shiller Index has a history of cooling off in the second half of the year.

Will the same seasonal event happen again in 2018?

Most likely – our June and July index numbers were the same this year, so it’s likely to stay flat, or even soften a bit like last year.  But were talking fractions, not big chunks.

The number of sales are another thing, however.  Few sellers NEED to sell, so while buyers might offer less, it takes two to tango.

The CNBC article that tried to paint a negative slant on the New York market included this quote:

“Offers 20 percent and 25 percent below asking prices began to flow in, a phenomenon last seen in 2009,” wrote Warburg Realty founder and CEO Frederick W. Peters”.

While few sellers struck deals at those radically reduced offer prices, they signal a major shift in our marketplace, one which has been building for at least 18 months,” Peters said.

Sellers aren’t going for it.

They might knock off a few points, but unless they are unusually desperate, they are going to sit on their presumed equity and wait until next year if they have to.  Sales would have to grind to a halt for sellers to think about dumping on price.

There will be just enough action to keep the sellers optimistic too.  Here are a set of homes that were marked pending today that could make you think everything is fine:

Another agent has this one, but you saw it here last time around:

This is in La Costa Valley, which has been starting to show it age when you’re talking about 20-year old Carlsbad tract houses now over a million. But this had the updated and appealing look, and the first buyer took it:

My friends in Olde Carlsbad went pending too:

I know they aren’t closed yet, and at least one of those will probably fall out.  My point?  The market isn’t dead, or even sleeping – it’s just finding its way.

Posted by on Oct 1, 2018 in Jim's Take on the Market, Sales and Price Check, Same-House Sales | 2 comments