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Journal

Spring Fizz?

Reader Tom had this observation yesterday:

I think the market turned this week. I’m seeing more inventory where I look. I’m seeing more price reductions. I’m seeing houses come on decently priced that aren’t flying off market. I think we will look back in 2 years and see this was the peak month. Downhill from here.

We’re coming off an active spring selling season so far:

NSDCC Detached-Home Sales between March 1 – April 15

Year
# of Sales
Median SP
Avg. $/sf
2012
345
$813,500
$367/sf
2013
438
$873,250
$406/sf
2014
351
$1,030,000
$494/sf
2015
419
$1,100,000
$496/sf
2016
365
$1,142,331
$525/sf
2016
361
$1,140,000
$499/sf

We might be seeing the real estate tides going out, and the accurate pricing becoming more obvious, which happens this time of year.  The over-priced listings start stacking up once we get this far into the selling season (May starts next Monday!).

We also noted last year that the peak time to sell is right now, and that by May 15th the new pendings start to drift off.  Could the selling season be closing out earlier this year?

The rest of the selling season is going to be case-by-case.  There is a smaller beach house in Oceanside today listed in the low-$700,000s that has so much action that the bids are pushing towards $800,000!

What can sellers do?

  1.  Don’t use Active Listings as Comps – All the active listings tell you are the list prices that aren’t working.
  2.  Don’t Rely on Sold Comps as Absolute Proof of your Home’s Value – They are likely indicators, but those buyers might have been crazy, or got suckered into a hot bidding war.  Question the cash sales too; buyers are throwing around money like water.
  3.  Don’t Use Range Pricing – Give buyers a clear number to shoot at. My listing in NE Carlsbad suffered an unfortunate occurrence when the house across the street listed on a too-large range of $725,000 – $800,000.  The owner/agent got four offers over the first weekend, which did the same thing it does to all sellers – it makes them want the top of the range.  I told her she should ditch the low end, and just go with the $800,000.  She didn’t, and instead cancelled the listing three weeks later. In the meantime, I’m trying to sell the same model with view for $849,000, which would have looked reasonable if hers was $800,000 with slope instead of view – we both could have sold!
  4.  Lower Your Price – If you’ve been on the market for weeks, buyers think something is wrong with your price.  Buyers are on to it – ‘how long have you been on the market’ is the most heard question at open houses.
  5.  Keep Improving Your Home – If you don’t want to lower the price, you can keep improving your home along the way to justify the price.

Daytrip left this comment:

I think price peaks and drops will be like playing whack-a-mole this season. Take out the noise, and it’ll still be heading up. Quality properties will get good prices.

I agree, but once a house is for sale, it is subject to market forces.  Sometimes you just hit a dry spot, and adjusting is more effective than waiting!

Posted by on Apr 24, 2017 in Jim's Take on the Market, North County Coastal, Spring Kick | 1 comment

Inventory Watch

A few extra new listings this past week – and it could continue!

We started a run during the last week of April, 2016 where we had 100+ listings in nine out of the next ten weeks.  We averaged 70 new pendings per week during the same time frame.

Week
New Listings
New Pendings
Feb 6
101
55
Feb 13
89
55
Feb 20
92
57
Feb 27
66
73
Mar 6
102
66
Mar 13
99
59
Mar 20
93
82
Mar 27
82
60
Apr 3
104
70
Apr 10
96
83
Apr 17
99
69
Apr 24
106
68

All ahead full!

Click on the ‘Read More’ link below for the NSDCC active-inventory data:

Read More

Posted by on Apr 24, 2017 in Inventory, Jim's Take on the Market | 0 comments

Mortgage Underwriting After Tax Day

Did you file an extension for your 2016 tax returns, and are trying to buy a house?  Have you released your financing contingency yet?

Here’s what you have to do to qualify for a mortgage:

Yes, “Tax Day” has passed, and lenders and investors must consider filed taxes in their underwriting decision. For example, LHFS issued a reminder regarding 4506 transcripts. Loans dispersed on or after April 18th will require the 2015 and 2016 returns or all the following:

Evidence of filing a Tax Extension (IRS Form 4868-Application for Automatic Extension of Time to File U.S. Individual Income Tax Return) filed with the IRS; Tax liability reported must be compared to the borrower’s tax liability for the previous 2 years as a measure of income source stability & continuance. An estimated tax liability that is inconsistent with previous years may make it necessary to require the current years return to proceed. IRS Form 4506-T Transcripts confirming “No transcript available” for the applicable tax year; and Returns for the prior two years.

If you owe additional taxes and sent in an amount with your extension, don’t be surprised if your lender will want to see evidence of that too.  Also note:

If you are sending in $100 million or more in taxes, I’ll be happy to drive your money to the post office!

Posted by on Apr 23, 2017 in Jim's Take on the Market, Mortgage Qualifying | 0 comments

Transitional Style

Here are the basics of the home decor that is hot today. They call it transitional style because it balances multiple styles, but it’s also the look for those who are in transition – it’s the staging look that buyers see everywhere!

http://www.realtor.com/advice/home-improvement/what-is-transitional-style/

With so many decor styles out there, it can be hard to stick with just one. Modern, rustic, shabby chic, traditional—deciding on the vibe you want for your home can be downright confusing. But here’s the great thing about interior design: Many of these styles overlap, and can actually work really well together. The design world uses the term “transitional style” to describe the type of design that melds two different aesthetics—modern and traditional—into the same room. So how can you bring transitional style into your home? Our experts break it down for you.

Read More

Posted by on Apr 22, 2017 in Jim's Take on the Market, Tips, Advice & Links | 2 comments

NSDCC Actives/Pendings

Historically, we have considered our market to be relatively ‘healthy’ when the actives-to-pendings ratio is around 2.0 – but that thought originated when prices were about half of what they are today!

Here are the stats for the NSDCC detached-home market (La Jolla to Carlsbad):

Reading Date
Actives
Pendings
A+P
A/P
Oct 28, 2015
970
358
1,328
2.71
Feb 1, 2016
788
254
1,042
3.10
Mar 23, 2016
900
399
1,299
2.26
June 21, 2016
1,052
428
1,480
2.46
Aug 17, 2016
1,060
395
1,455
2.68
Dec 4, 2016
886
327
1,213
2.71
Apr 21, 2017
842
427
1,269
1.97

Considering that we have record-high pricing in most areas, it is phenomenal to see so many pendings – and so few actives!

Actives Median Price = $2,350,000

Pendings Median Price = $1,299,000

Only 10% of the actives are under $1,000,000, and 35% are over $3,000,000!

Here are the Actives/Pendings ratios for each area.  If you remove La Jolla and RSF, the A/P = 432/336, or 1.29 to 1!

Area
Zip Code
June
Aug
Dec
Act/Pend Today
Cardiff
92007
2.3
3.5
1.1
15/15 = 1.0
Carlsbad NW
92008
2.0
2.3
1.3
40/34 = 1.2
Carlsbad SE
92009
1.6
2.0
1.9
73/74 = 1.0
Carlsbad NE
92010
0.7
0.9
1.3
23/25 = 0.9
Carlsbad SW
92011
1.6
1.5
1.3
26/24 = 1.1
Del Mar
92014
3.2
2.5
4.9
63/19 = 3.3
Encinitas
92024
1.3
1.8
1.8
87/55 = 1.6
La Jolla
92037
4.8
4.4
4.4
172/46 = 3.7
RSF
92067
8.2
6.3
6.3
207/40 = 5.2
Solana Bch
92075
2.9
3.9
2.7
19/13 = 1.5
Carmel Vly
92130
1.5
1.8
1.8
86/77 = 1.1
All Above
All
2.5
2.7
2.7
842/427 = 2.0

WOW!

Posted by on Apr 21, 2017 in Actives/Pendings, Jim's Take on the Market, North County Coastal | 0 comments

Failed Auction?

The no-reserve auction of Matt Kemp’s house in Poway today was postponed until April 25th.

Why would you postpone for 5 days?

There has to be buyers. This company has been very successful in selling seven and $8-figure homes throughout the world, and they have grown exponentially. The auction process is a big hit, and it is the best solution for selling homes.

George guessed that it could be a failed auction before I saw it get postponed on the website.  He’s looking very astute now….or is George an insider? 😆

Save

Save

Posted by on Apr 20, 2017 in Auctions, Bubbleinfo TV, Contests, Jim's Take on the Market, View | 9 comments

Live Auction April 20th

The auction of Matt Kemp’s house in Poway is Thursday!

You can watch the auction live at 4:00pm Pacific Time on the Concierge Auctions mobile app, where you can also find their rules list.  They will add a 10% buyer’s premium to the winning bid to determine the final sales price.  If you didn’t know that and want to change your bid, feel free!

Kemp has $12,000,000 invested.  The person with the closest guess will receive four tickets to a Padres game!  Here are the guesses:

$4,200,000 – Rob

$4,735,000 – BAM

$5,325,000 – Amy

$5,700,000 – elbarcosr

$5,900,000 – Real Estate Rookie

$6,200,000 – Nick LB

$6,250,000 – Tom

$6,500,000 – LT

$6,519,000 – Matt V.

$6,900,000 – Daniel

$7,050,000 – Susie

$7,126.000 – Ed

$7,350,000 – Mark H.

$7,423,200 – Goughy

$7,875,000 – Kerry

$7,900,000 – kman

$8,000,000 – Name

$8,800,000 – Mike M.

$8,888,888.88 – JakeL

$9,100,000 – Lifeisradincarlsbad

$9,210,000 – CJ

$9,400,000 – Derek

$9,500,000 – Joe k

$9,600,000 – Mike Call

$9,750,000 – bode

$9,800,000 – Jenny

$10,000,200 – Janet

$10,527,000 – Eddie89

There is still time – leave your guess in the comment section below.

Here are more details on the house:

http://www.bubbleinfo.com/2017/03/27/contest-4-padres-tickets/

Save

Posted by on Apr 19, 2017 in Auctions, Contests, Jim's Take on the Market | 16 comments

J. Geils

We lost a true guitar hero, J. Geils, on April 11th.

He mentions touring with the Stones in 1982 – were you one of the 100,000 who attended their show at the L.A. Coliseum?  The band was rocking that day!

But he and the band had disputes later, and there aren’t many great live show on youtube with J. Geils in them – lately the band was playing without him.  But this video has him talking about his guitars, and playing a little:

If you get a chance, watch the next video too about his Italian cars!

Posted by on Apr 19, 2017 in Wednesday Rock Blogging | 2 comments