Coastal-Home Touring
Here’s a look at three new listings that were on broker preview today:
More Classic Rock
From #1 to Flat City
Do you remember that stretch in 2023 when the San Diego-Chula Vista-Carlsbad metro area had the best appreciation in the country? It wasn’t that long ago!
Look how it’s changed since:
Widespread housing market softening
49 of the nation's 50 largest metro area housing markets have a weaker year-over-year home price shift this spring than a year ago
Analysis via @ResidentialClub
Article: https://t.co/xQxH5X3A0w pic.twitter.com/6OeuSWNIYW
— Lance Lambert (@NewsLambert) May 12, 2025
Real Estate Downturn?
Hey Jim – you’ve been around. Tell us stories about previous downturns!
You don’t see them coming because they usually arrive without notice, and they tend to sneak up on you! After a few weeks of nothing, everyone starts to realize that the buyers have dried up.
But let’s be careful about the discussion.
Are we in a downturn now?
Let’s look at the definition:
YELLOWS – Yes, these are factors today, in varying degrees.
ORANGES – They might be factors, and we’ll see. The initial tariffs were a shock, but receding now.
Two key facts: Sales are holding up, and sellers have considerable equity.
- The NSDCC sales this month are running at the same pace as last May. We can have excess supply, but as long as sales are holding up, we’re not in a downturn.
- Home sellers have never had this much equity. It’s scary that homeowners have so much equity that it could enable any of them to dump 10% or 15% on price to just to get out if needed! We’ve never been in this position before where a whole neighborhood could lose 10% to 20% in value in just a few short months – and freeze up the market for the remaining homeowners (who would justify waiting by declaring that it’s not a good time to sell).
Downturn isn’t the right word to describe the current market conditions.
Instead, I’ll call it The Big Wait.
Here’s an example:
We listed this home on Birdie on April 16th.
The tariff chaos was underway, so we lowered the price early – just 12 days into the listing.
The next day, a buyer called me directly. He said he had seen many price reductions in the marketplace lately, so he was just waiting to pounce on a good listing once they did their first price drop.
We opened escrow the next day, but his dreams of building an ADU dwindled quickly and he cancelled after five days of investigation. Boom – we’re back on the market on May 5th.
This home had been a rental for the last 17 years, and it was rough when we came on board. The seller spent $130,000 to get it back in selling shape, and it stood out among the active inventory.
By Monday, we had received two more offers. We countered for highest-and-best.
I’m in charge of sales, and all inquiries come to me. Even when we have multiple counter-offers out, I’m keeping the door open. Our deadline was 5pm yesterday, so there was still time for other offers.
Here are the three people who checked in yesterday:
A lady had sent a text on Friday night about seeing the house, so I invited her to attend the Saturday open house, and she came. She had already sold a rental property, and is doing a 1031 exchange which means she needs to re-invest into another rental. She calls back yesterday with interest, so I send her the disclosures – but then she ghosts me. I guess she is going to wait for another one? But her 45-day clock is ticking.
A broker from Orange County looked at it yesterday for himself. I love when buyers come from behind the orange curtain because everything here looks cheap. He says he wasn’t surprised to hear we have two offers, but he doesn’t answer my question about whether he wants to buy it. Another wait-and seer.
A local buyer-agent who showed the house to her buyers on the first weekend wants an update. She has been stalking the property since she first saw it – saying her buyers really like it – but no offers are made. More buyers waiting for something.
Buyers are comfortable with waiting – because it is comfortable on the fence. You’ve probably noticed that the sellers are comfortable with their pricing, and the vast majority of them are waiting too.
It’s The Big Wait.
It’s not a standoff, because that would imply interaction. It’s a cordial, friendly waiting that looks more like loitering because you know people want to do something but just not now. Waiting is more comfortable.
I don’t think they know exactly what they are waiting for, but it is ‘something’.
We will probably see spurts of sales occasionally as ‘something’ comes along. Maybe even a surge of sales at the end of summer as time runs out?
Let’s hope the Big Wait doesn’t turn into a lengthy disease!
Full Blown Glutty
Bill’s charts give us a good feel for the San Diego market.
Sales are doing great – April sales were better than last year:
The new listings are in check too. About the same as last April:
But here’s the problem. The supply is overwhelming the demand:
The number of 2024 listings in San Diego County was 22% higher than they were in 2023. Because the inventory had been historically low, I thought we could endure another 15% to 20% increase in the number of homes for sale this year.
But now the active inventory is 40% above last year? Yikes!
It means there is going to be massive disappointment among sellers. Of the detached and attached homes for sale around the county, 73% of them have been on the market for more than two weeks.
If they don’t make drastic changes in price and/or condition quickly, they won’t sell…at least not this year. The home buyers are on to it, and their patience is paying off. You may see an occasional crazy sale (six offers over list), but it isn’t a trend – anywhere.
It means there will be thousands of sellers carrying their hopes into 2026.
The Lowball Season is going to start earlier this year – probably by September. It means today’s sellers have 1-2 months to do more to improve their home and get sharper on price. Or face an unprecedented surge of 2026 listings, beginning in January. And there won’t be enough buyers then either.
The word is getting out too:
Cardiff $6,900,000
Check out Kelly Howard’s new listing!
Welcome to a modern masterpiece at 417 Warwick, Cardiff, where luxury meets innovation in this expansive 5-bedroom, 5.5-bathroom home. Spanning 5,710 square feet on a generous 20,295 square foot lot, this property is located in the heart of Cardiff’s composure district, overlooking the picturesque Rossini Canyon.
Enter into a bright and open space that sets the tone for the entire home. On the main floor, you will find a versatile office space, an inviting bedroom with an attached bath, a media room perfect for movie nights and entertainment, and a stylish powder room for guests. The open-concept design features a high-end kitchen equipped with premium appliances, seamlessly connecting to a spacious living area and family room. This layout is ideal for both intimate gatherings and large celebrations.
The design of the home facilitates a harmonious flow between indoor and outdoor dining, leading to a backyard oasis. Here, you’ll find a sparkling pool, a rejuvenating spa, and a built-in BBQ area, perfect for alfresco dining and entertaining under the beautiful Cardiff skies.
Upstairs, explore three additional bedrooms, each with its own attached bathroom, ensuring comfort and privacy for family and guests. The generous primary suite is a true retreat, offering a luxurious space complete with all the amenities needed for relaxation and unwinding.
This residence is more than just a home; it’s an embodiment of sophisticated coastal living, offering a blend of luxury, comfort, and style in a desirable Cardiff setting. Living in Cardiff means embracing a laid-back coastal lifestyle. Enjoy sunny days and cool ocean breezes while being close to everything this vibrant community has to offer. From the stunning beaches to local dining and shopping, there’s always something to explore.
Experience the elegance of this exceptional property, where every detail is crafted to enhance your lifestyle!
Tariffs Behind Us?
The tariff talk is settling down, the stock market looks fully recovered, we got a new pope, and the President is getting a new airplane.
Can we get back to selling homes now?
Usually we consider a ‘healthy’ market to have a ratio of 2:1 actives-to-pendings.
Above is a chart of local areas showing their number of active listings today, and the number of listings that went pending since April 2nd.
A ratio of 2:1 might be a little stiff, so let’s consider any market that has a 3:1 ratio or better to have survived Liberation Day, and is back on track.
GREEN: Areas that have a 3:1 ratio or lower.
RED: Areas that have a ratio higher than 3:1.
For the most part, buyers and sellers are back to transacting, and others can wait!
Inventory Watch
It looks like the tariff distractions might be behind us?
The number of pendings increased for the second week in a row, and the number of active listings actually declined! It might just be a break for Mother’s Day though, and there should be a steady increase of listings over the next few weeks – with only some of them selling.
Note: For those who review the stats below, know that I used the same $$/sf as last week for the high-end listings. The number was skewed by this listing, which I think has a mistake on price:
Boomer Psycho-Babble
Meredith has been predicting the silver tsunami since 2023, but since it hasn’t happened (yet), she is now reversing course and is saying seniors are broke and can’t afford to move:
Baby boomers are dragging on the housing market because most can’t afford to move out of their homes, according to Meredith Whitney, the “Oracle of Wall Street” who predicted the Great Financial Crisis.
In an interview on Bloomberg TV on Wednesday, she said many cash-strapped Americans have been borrowing against their homes, and 44% of home-equity loans are being taken out by seniors, “which is counterintuitive. It’s crazy, right?”
That’s contrary to the typical narrative of baby boomers sitting on vast amounts of wealth accumulated over their lifetimes, which spanned unprecedented economic expansions and stock market booms.
As a result, seniors with a lot of money have an edge in the tight housing market, accounting for 42% of all homebuyers, while millennials account for 29% despite the younger generation being in the prime buying years.
But while most buyers are boomers, it doesn’t mean most boomers have a giant pile of cash.
“I divide it into different cohorts,” Whitney said. “So the senior which everyone thinks ‘the boomers have all this money’—that’s a small portion. Seniors are living paycheck to paycheck.”
To be sure, boomers collectively have $75 trillion of wealth. But that’s not distributed evenly, and Whitney estimated that just one in 10 seniors can afford assisted-living facilities.
As a result, many are forced to stay put and age in place, she added. (Stubbornly high mortgage rates also have created a “lock-in” effect where homeowners who got in the market when rates were low are now reluctant to buy a new home at today’s elevated borrowing costs.)
“This is one of the problems with the housing inventory,” Whitney told Bloomberg. “They’re staying in their houses longer because they can’t afford to move out.”
https://finance.yahoo.com/news/most-baby-boomers-t-afford-220048092.html
For Pete’s sake – seniors could afford to move if they just sell their house. The reason they don’t move is because they don’t want to leave town, which is the only way to make it worth moving.
The seniors that do move are getting closer to family, and in particular, closer to the grandkids. All the rest are staying until the end.
Single Agency
Buyers aren’t crazy about signing a three-month contract just to see homes for sale – and neither are the buyer-agents. Every problem with home sales will get solved by cutting out the buyer-agent, even though it’s bad for buyers.
