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Category Archive: ‘Same-House Sales’

San Diego Case Shiller Feb 2013

Not only do we expect higher, but now much higher readings from the monthly Case-Shiller index.  The consensus expected +9.0% nationally, and it came in at +9.3% for the 20-city composite – the biggest gain since May 2006.

“Home prices continue to show solid increases across all 20 cities,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “The 10- and 20-City Composites recorded their highest annual growth rates since May 2006; seasonally adjusted monthly data show all 20 cities saw higher prices for two months in a row – the last time that happened was in early 2005.

“It is very strong, it’s a solid rebound, but I would not call it a bubble,” said Blitzer about housing.

San Diego’s Case-Shiller index topped the national composite, with +10% improvements both the seasonally-adjusted, and non-seasonally adjusted readings.

This is the 13th month in a row that we’ve seen gains, which means the Y-O-Y readings will be on top of a previous gain as well.  But we should see more eye-popping results in the next couple of months – probably higher than 10% increases year-over-year.

For example, here are the SD monthly average $/sf:

Month 2012 Avg 2013 Avg Difference
March
$225/sf
$266/sf
+18%
April
$225/sf
$277/sf
+23%

By the time we see the Case-Shiller March and April readings, will buyer exhaustion be setting in?  If so, more double-digit gains may cause them to surrender, especially when they see it tacked on to already-frothy list prices.

Posted by on Apr 30, 2013 in Same-House Sales | 14 comments

Shiller Says “Auspicious Time To Buy”

Thanks to Stormin for sending in this post from Bill at CR:

I think Professor Shiller has changed his view … writing in the NY Times: Before  Housing Bubbles, There Was Land Fever

“With rates now relatively low, this could be an auspicious time to buy a house  with a fixed-rate mortgage. That could make good sense for people who aren’t out  to bet on the housing or mortgage markets but are instead focused on settling  into a home  for the long term.”

It might be an “auspicious” time to buy … if someone can find a home for sale  (there is so little inventory in many areas).

Read more at http://www.calculatedriskblog.com/2013/04/shiller-on-housing-could-be-auspicious.html#cDUgYgbgQI4qOOo0.99

Posted by on Apr 21, 2013 in Same-House Sales | 8 comments

San Diego Case-Shiller Index Jan ’13

San Diego’s latest seasonally-adjusted Case-Shiller Index increased for the 12th month in a row:

Jan. 2012: 150.74

Dec. 2012: 164.87

Jan. 2013: 165.48

Year-over-year: +9.8%

Month-over-month: +0.4%

Yesterday an appraiser confirmed that he is adjusting comps for appreciation, and mortgage underwriters are going for it. He said that adding 0.5% to 1.0% per month is acceptable.

A twelve-month winning streak, and banks allowing appreciation in appraisals - what’s next, no-doc loans?

P.S. The previous month-over-month difference was +1.0%.

Case-Shiller Home Price Index: San Diego, CA Chart

Case-Shiller Home Price Index: San Diego, CA data by YCharts

Posted by on Mar 26, 2013 in Same-House Sales | 5 comments

JtR’s Crystal Ball

MB Mike asked a follow-up:

In terms of timing, what does your crystal ball say 2014 will bring? Better to wait a year to sell?

Yes, wait if general market conditions are your guide.

Real estate is reported as ‘up’ or ‘down’, and it will be ‘up’ for a while.

The media loves real estate, and will be following it closely in order to sensationalize every bump and wiggle.  The more good news that buyers see and hear, the higher their anxiety, and the more they will pay to end the struggle.

The current frenzy conditions feel exactly like they did in the 2003 run-up.  Here’s the Case-Shiller Index (seasonally-adjusted):

Case Shiller San Diego

I think we will experience the same trajectory as we did in 2003, and maybe faster if inventory grows at the perfect rate – which is more inventory please, but not too much. :lol:

There are going to be pocket areas/markets that show 10%-20% appreciation in the first half of 2013.

They are the lower-priced segments of premium areas – homes under $900,000 in Carmel Valley, the $600,000-$700,000 market in Rancho Penasquitos, and the under-$700,000 market in Carlsbad are examples.

Yet, you can go to Rancho Santa Fe’s $3,000,000+ market and find 119 active listings – and four have closed in the last 30 days.

When to sell is relative to your location, price range, and what you are selling.  Here are the Three Amigos discussing it:

Let’s also note that you won’t see the bad news coming that could derail your quest for the extra pop, because bad news always sneaks up on you.  Examples:

1.  Flash flood of competing sellers nearby.

2.  A sudden increase in mortgage rates caused by market forces, which the Fed can’t control.

3.  Realtor fraud, creating a low comp or two.

4.  Natural disasters – earthquakes, etc.

5.  Man-made disasters – nuclear war by the North Koreans, etc.

Any of those reasons would cause buyers to quit chasing the pricing stampede, and get back on the sidelines to watch and wait for prices to go down.  Many people, mostly the W-2 employees, have already been priced out of the areas they thought they could afford, and are left searching for alternatives; which amount to inferior neighborhoods, hitting the lotto, or waiting.

Don’t rely solely on what you see here at Bubbleinfo.com.  We specialize in selling superior products in premium areas, and the examples seen here are the cream of the crop.  Generally the demand is very deep currently, but it will dry up in the more-standard areas first.

Get good help!

Posted by on Mar 19, 2013 in About the author, Bubbleinfo TV, Forecasts, North County Coastal, Same-House Sales, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 24 comments

SD Case-Shiller +9.2% Y-O-Y

The San Diego Case-Shiller Index rose 9.2% year-over-year.

While a 9.2% increase in home prices would have been shocking a year ago, we have come to expect it today.

The month-over-month increase was 1.07%, which should be about what we see for the rest of 2013.  If the Case-Shiller Index didn’t exclude flips owned less than six months, the number would be even higher.

Today’s SA reading is 14.2% higher than the trough reached in April, 2009.

Case-Shiller Home Price Index: San Diego, CA Chart

Case-Shiller Home Price Index: San Diego, CA data by YCharts

Both the seasonally-adjusted, and non-seasonally-adjusted numbers rose by the same percentage, which has happened the last few months.

Posted by on Feb 26, 2013 in Same-House Sales | 3 comments

“My Wife Wants Them”

Shiller is asked in the video how many houses he owns (two) and why – his answer – “My wife wants them”. (at the 7:50-min mark)

Robert Shiller, the Yale  economist who nailed the housing bubble before it burst, was on Bloomberg  Television with Trish Regan and Adam Johnson on Wednesday afternoon to  discuss the U.S. housing market.

As usual, Shiller was reluctant to declare that home prices had  bottomed.  He explained that the  housing market is a speculative one  and that there’s no telling, which way prices would go tomorrow.  He also  explained that there wasn’t much reason to believe that home prices would  appreciate back to levels seen during the last cycle.

Regan followed up with a question that got Shiller perked up.

“Then why buy a home?” she asked.  “People trap their savings in a  home.  They’re running an opportunity cost of not having that money liquid  to earn a better return in the market.  Why do it?”

“Absolutely!” Shiller exclaimed.  “Housing traditionally is not viewed  as a great investment.  It takes maintenance, it depreciates, it goes out  of style.  All of those are problems. And there’s technical progress in  housing.  So, new ones are better.”

These were some of the issues Shiller addressed in his classic book, Irrational  Exuberance.

He continued.

“So, why was it considered an investment?  That was a fad.  That  was an idea that took hold in the early 2000′s.  And I don’t expect it to  come back.  Not with the same force.  So people might just decide,  “Yeah, I’ll diversify my portfolio.  I’ll live in a rental.”  That is  a very sensible thing for many people to do.”

Adam Johnson also noted that this was in line with Shiller’s assessment that  real U.S. home price appreciation from 1890 to 1990 was just about 0  percent.  This is explained by the falling costs of construction and  labor.

For people who can’t wrap there heads around this, Shiller offers an  analogy.

“If you think investing in housing is such a great idea, why not invest in cars?” he asked.  “Buy a car, mothball it, and sell it in 20 years.   Obviously not a good idea because people won’t want our cars.  It’s the  same with our houses.  So, they’re not really an investment vehicle.”

Any homeowner knows that you can’t sell a home with 30-year-old roofing,  carpet, and kitchen appliances.  Sure, the home price might go up, but you  have to adjust for years of maintenance and renovations.

Read more:  http://www.businessinsider.com/robert-shiller-home-investment-a-fad-2013-2#ixzz2KEVPbaDg

Posted by on Feb 7, 2013 in Market Conditions, Real Estate Investing, Same-House Sales | 8 comments

SD Case-Shiller Up 8% Y-O-Y

San Diego Case-Shiller Index, non-seasonally-adjusted (SA was also +8%):

November 2011:  151.45

November 2012:  163.58

Year-Over-Year Change: +8%

From the S&P press release:

“Winter is usually a weak period for housing which explains why we now see about half the cities with falling month-to-month prices compared to 20 out of 20 seeing rising prices last summer. The better annual price changes also point to seasonal weakness rather than a reversal in the housing market. Further evidence that the weakness is seasonal is seen in the seasonally adjusted figures: only New York saw prices fall on a seasonally adjusted basis while Cleveland was flat.

Regional patterns are shifting as well. The Southwest – Las Vegas and Phoenix – are staging a strong comeback with the Southeast — Miami and Tampa close behind. The sunbelt, which bore the brunt of the housing collapse, is back in a leadership position. California is also doing well while the northeast and industrial Midwest is lagging somewhat.

“Housing is clearly recovering. Prices are rising as are both new and existing home sales. Existing home sales in November were 5.0 million, highest since November 2009. New Home sales at 398,000 were the highest since June 2010. These figures confirm that housing is contributing to economic growth.

The Case-Shiller process screens out any properties re-sold within six months.  Because of market efficiencies, most flippers aren’t included in their +8% year-over-year calculation.  For the 200 properties he sold last year, J. Mann’s average was 16 days on market.

Microsoft Word - CSHomePrice_Release_012935.doc

“Housing is clearly recovering”, David Blitzer, chairman of the index committee at S&P Dow Jones Indexes, said in a statement.

“There’s a lot of momentum,” he added during an interview on CNBC’s “Squawk on the Street.” “It shows up in all the housing statistics, not just the prices. As far as I can see it’s going to continue well into the new year.”

The spread between historically low interest rates and the money that real estate generates is “truly astonishing,” Starwood Capital Group Chairman and CEO Barry Sternlicht told CNBC on Tuesday.

“You can buy assets below replacement costs still,” he said in a “Squawk Box” interview. “You can finance them with positive leverage — meaning the cost of borrowing is much lower than the yield on the property.”

Sternlicht pointed out, “Never seen it in my career. It’s truly astonishing. This is the ‘Goldilocks Period’ for real estate.”

For people looking to buy or sell a home, he predicted, “You’re not going to see housing prices runaway. I think they’ll continue at a really modest three to four percent annual growth now.”

Posted by on Jan 29, 2013 in Same-House Sales | 4 comments

Get Ready For Case-Shiller Tuesday

Are local home prices off to the races?

We are attracted to the sensational stories, where houses are selling for more than 10% over recent comps.  A solid $650,000 offer wasn’t enough to win the bidding war on this house, even though the last three model-match sales were $576,000, $591,000, and $605,000 in September-November of last year.

But statistically, the average price-per-sf looks much more mundane, and demonstrates how specific home buyers are about values, and how much they are willing to pay.

Here are the monthly cost-per-sf averages, splitting the NSDCC into two parts:

NSDCC North – Cardiff, Carlsbad, and Encinitas:

NSDCC-North Mo Avg $-sf

(The current averages for January, 2013 are tacked onto the end of the 2012 purple trend line)

Average prices look remarkably range-bound until recently (this month), and it will take a few more months to know if the pricing increase will stick.  It appears that Y-O-Y changes in sales may level off, or start dropping.  In the last two Januarys we’ve had 85 and 89 sales in NSDCC-North, and only 64 have closed this year with four days to go.

NSDCC South – La Jolla, RSF, Del Mar, Solana Beach, and Carmel Valley:

NSDCC-South Mo Avg $-sf

A big surge in November and December, but so far the average pricing of the 56 sales in January are right back in line with the range/trend (the last two Januarys had 64 and 66 sales).

November’s Case-Shiller Index will be released on Tuesday.  The local SD Case-Shiller Index has increased nine months in a row, with October’s reflecting a 6% increase year-over-year.  It was noted last month that Tuesday’s report should be eye-popping (as much as +10% increase Y-O-Y), and just in time to inflate seller expectations for the spring selling season.

Hopefully it will cause more sellers to list their home for sale.  In areas where there is a surge of listings, buyer expectations could soften unless the list prices are reasonable enough that they cause some sales momentum.

Yes, it’s true – your price causes the sale, and how your agent handles it determines if, and how much, it goes up or down from there.

I can spend $1,000,000 on advertising and do open house every day, but if the price isn’t right, it isn’t going to sell.

Posted by on Jan 27, 2013 in Forecasts, North County Coastal, Same-House Sales | 4 comments

No Seasonal Slowdown

Tuesday’s Case-Shiller report is going to blow the roof off the market:

The housing market typically experiences a seasonal slowdown during the winter months, but this year seems to be different, according to the latest Campbell/Inside Mortgage Finance survey.

In fact, all three homebuyer groups — current, first-time and investors — recorded their most significant traffic gains of 2012 in December.

“According to our survey respondents, this is not a normal winter. Time on market for non-distressed properties is much lower, and we already see our homebuyer traffic indexes building toward a strong spring/summer buying season,” said Thomas Popik, research director for Campbell Surveys.

Not only did the 2012 winter numbers look strong, but the report showed signs of good things to come. Time on market, number of offers, closed transactions and sales prices were all improved at the end of 2012.

The “time on market” index, where a decline is actually a good thing, dropped from 42.4 in November to 40 in December.

The “number of offers” index rose from 57.3 to 61.5 between November and December. The survey considers an index value of 50 as reflective of no change or a flat market environment.

The “closed transactions” index from the survey rose from 51.2 to 54.4 during the same year-end period.

The “sales price” index not only jumped from 58.1 to 61.1 from November to December, but also peaked at its highest level ever recorded.

A majority of those surveyed stated that this winter was much busier than a typical winter, due largely to low inventories of homes for sale and strong homebuyer traffic.

http://www.housingwire.com/fastnews/2013/01/25/housing-market-saw-no-seasonal-slowdown-2012

Posted by on Jan 25, 2013 in Market Buzz, Same-House Sales, Spring Kick, Thinking of Buying?, Thinking of Selling? | 1 comment