Jackson and David
Getting A Deal
Earlier, I was preparing for the appraisal of our 1,944sf listing on Birdie, which is in escrow for $1,125,000.
I always bring the comparable sales with me to help out the appraiser. They want to use comps whose square footage are within 10% of the subject property, so I plugged in a tight 1,700-2,100sf range to get the best examples.
The home above was the first on the list.
It sold in February for 40% less than mine?
Let’s check the sales history first:
A conglomerate foreclosed on the previous owner in 2013?
They had it rented for $2,400/mo. and they sat on it until now.
The seller was the infamous Invitation Homes, who has plenty of horsepower:
This was a fairly straight-forward sale that was offered on the MLS and anyone could have bought it. The timing over the holidays wasn’t ideal, but because the seller had plenty of equity, they lowered the price early and often:
Here’s what it looked liked when sold:
https://www.compass.com/listing/1809-avenida-segovia-oceanside-ca-92056/1727153224339587161/
The new owner installed new windows and roof plus a few interior items and is now trying to rent it for $4,199 per month.
Are you looking for a deal? This is a good example of how to do it! Especially the part about buying a home that needs everything, and then working over the seller for a reduction/credit once you have it tied up in escrow.
Price Cuts?
Everyone is wondering if home prices are going to come down, so the mainstream media is happy to juice the conversation with a sexy headline – which, if you are a casual reader, will make you think that lower prices are on the way. Then they throw in a quote from a real estate expert:
San Diego metro, which includes all of San Diego County, ranked 15th in the 20-city index — a big change considering the region had the fastest-rising home prices in the U.S. for six months from late 2023 into the start of 2024.
The fastest-rising markets in March were New York, up 7.96%; Chicago, up 6.5%; and Cleveland, up 5.9%.
Zillow economist Orphe Divounguy said the share of nationwide listings with a price cut in March hit their highest rate in six years. He said homes were taking longer to sell, resulting in some sellers slashing prices.
“A price correction is expected,” he wrote, “(which will) result in a modest recovery in sales over the coming year, with Zillow forecasting sales to continue bouncing along the bottom.”
It’s not that simple.
The national statistics will probably prove him right, but what will those mean to the local home buyer or seller? Nothing. But it might sell some newspapers!
Let’s drill down just a little.
If you want to get a screaming deal on a dump or fixer, your time has arrived. You will probably spend the next 3-12 months of your life wrestling with the city to get permits, battling with contractors to get what you want (and what you paid for), and you will likely spend more money than ever expected. A lot more.
You might end up thinking that buying a creampuff was a better idea.
Most will prefer to buy a nice home. One that is move-in ready, and has the more-modern conveniences so it will last you for the foreseeable future without having to fix anything.
Are those going to have price cuts too?
Here’s an example that’s fresh off the hotsheet this morning:
The seller had to discount $40,000, but hey, that’s a price cut! They still sold it for 85% more than they paid for the home when it was new in 2019, which is in line with stats we saw earlier this week.
The discounts will be on the homes that most people don’t want to buy.
Get Good Help!
Jim and Donna
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This is my best attempt at the polished, professonal content….
SD Case-Shiller, March
San Diego Case-Shiller Index, March
The back-to-back 1% gains will probably be as good as it gets in 2025, and we could wind up with a negative percentage overall for the year.
The change has been 1% or less (+/-) for the last eleven readings.
Welcome to Flat City.
Percentage change between January and December:
2019: +4.7%
2020: +12.4%
2021: +24.0%
2022: -1.0%
2023: +9.0%
2024: +3.2%
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“Home price growth continued to decelerate on an annual basis in March, even as the market experienced its strongest monthly gains so far in 2025,” said Nicholas Godec, CFA, CAIA, CIPM, Head of Fixed Income Tradables & Commodities at S&P Dow Jones Indices. “This divergence between slowing year-over-year appreciation and renewed spring momentum highlighted how the housing market shifted from mere resilience to a broader seasonal recovery. Limited supply and steady demand drove prices higher across most metropolitan areas, despite affordability challenges remaining firmly in place.”
Natalie’s First Tour
This is the beginning of Natalie’s career as a realtor! My impression of her? She is catching on to everything very quickly, and she has the drive and ambition (look at her dance career) that makes the difference between good and great agents.
Inventory Watch
The assault on the record book continues!
We have the most homes for sale since before covid – when pricing was less:
Yet, 500+ homeowners are scoffing at those gains – they want more!
Memorial Day
Price Reductions
These were my notes that expand on the previous blog post.
This is the Market Lull.
It’ll go for at least another month or two and for many it might last until January.
Hardly anyone knows what to do. Buyers don’t mind waiting longer – they keep hoping that something good would happen. Same with sellers. Agents who have only known a strong seller’s market (last 15 years) are getting anxious though.
Reducing the price by 5% is the minimum to impress buyers.
Price Reductions – When They Reduce The Price Sends A Signal
Price reduction in first month: No showings or offers and seller is motivated (and maybe panicked) and/or the listing agent is great at reading the room….especially if it’s a 5% drop.
Price reduction in second month: Normal, and needs to be 5% just to keep up.
Wait 3-4 months for first price reduction: Seller just starting to get it, but buyers have been ignoring the listing for 2-3 months. Too late to be able to sell this year.
No reductions: Seller doesn’t care and neither does the agent, or the agent is weak. By now, anything might happen with them so wake them up with an offer.
Rule of thumb: in the buyer’s mind, the value is going down about 1% per week. After 10 weeks, sellers should reduce drastically or quit. All you will get is lowballs.
How to identify agents to lowball who don’t have a sales skill set and need a deal to fall in their lap. They ask: “Do you have any questions?”
Buyers can ask this question at open houses: “Do you think it’s worth it?” How the agent answers that will tell you everything about your chances of getting a deal.
Home Price Formula
Here’s a formula that works well for buyers and sellers (who are smart to lower their price just to keep up). Listings that don’t lower their price will stale quickly.
