No Mistakes

Remember before the last crash when buyers and sellers were far more cavalier about their real estate decisions?  Why was that?  Because if they needed to move again, there were always a reasonably-priced house down the street or around the corner for sale.

But things sure have changed.

Selling/buying/moving is no longer just something you do casually.  Because of the difficulty, you are probably only going to move if, and when, you decide to make a permanent lifestyle change.

Look at the differences just since this blog has been around:

NSDCC January through September:

Year #Detached-Home Listings Percentage Over $2M Percentage Under $800,000
2005
4,487
19%
28%
2019
3,960
33%
5%

The noteworthy:

There Are Fewer Homes For Sale – In particular, there are fewer high-quality homes for sale that would make it worth it for existing homeowners to move up or down.  In spite of having loads of equity, trying to find a home better than your current home is a major obstacle.

Home Prices Are Higher Than Ever – If you can find a house that suits your needs, the price will be higher than ever.  You have to pay more, qualify for more, and be willing to eat higher recurring costs like property taxes too.

Cost of Moving is High – Gone are the days when you could throw everything you own into a U-haul and move in a day.  Commissions, closing costs, packers & movers, home upgrades, and new furniture will cost you $50,000 to $100,000 or more in any house you buy around the NSDCC.

Competition is Stiff – As a result of the three items above, buyers are very picky and holding out for the highest quality.  Staying on the edge of your seat 24 hours a day can take its toil!

It’s a Market For The Affluent – With only 5% of the NSDCC houses priced under $800,000, it means home buying is only for those who have real horsepower – and regular folks are priced out, unfortunately.

The stakes are high, and making any mistakes now will be very costly.  The worst part is that home prices are moderating (except in Solana Beach), and without an increase in their equity position, those who need to sell shortly after purchasing could incur a substantial hit.

We are in the No-Mistake zone. Get good help!

P.S. The Solana Beach house on Rios that set the all-time non-oceanfront price record in March at $8,250,000 was relisted for $9,750,000…..and it went pending today!

Segovia Shoot-Out


The Battle of Segovia is over.

Two of the same models were for sale across the street from each other in La Costa.

I had listed the green house on May 30th for $859,000, but because the seller claimed to be intensely private, he didn’t want it on the MLS, no signs, and no open houses.

I was curious to see if it is possible to sell an older house for a premium price just off internet ads – but we didn’t have one showing, so we agreed to part ways after five weeks.

Before we did, I suggested that we lower the price to $829,000.

The seller said, “I can sell it myself for that – I don’t need you”.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

At the end of July, I listed the house across the street at 3022 Segovia Way for $888,000.  It was featured here a few times – it was the original-looking house with the 13,000sf lot that backed to the school/park:

Twelve days later an agent from the auction company puts the green house on the MLS, priced on the range $839,000-$859,000.

When I was dealing with that seller, he was unwavering about price, so no surprise to see them adopt a similar pricing strategy – especially with me across the street at $888,000.

But it caused a standoff.

Buyers liked my big yard but were cautious about backing to a school yard and the amount of work needed to bring the home into this century.  The competitor across the street was cheaper and move-in ready….if you liked his DIY improvements.

The inevitable price war began:

August 12th: She listed on the range $839,000-$859,000.

August 19th: We lowered to $859,000.

August 23rd: She changed to $830,000 (no range).

August 27th: We lowered to $839,000.

We were doing open houses at the same time and were friendly competitors who compared notes. The action was good, and I thought we were probably close to selling both.

But her listing was running out at the end of August.

So when she re-listed with the seller, they decided to adopt the auction format instead.  She re-inputted the home as a new listing, priced at $699,000!

Their format provides some uncertainty because the seller has an undisclosed minimum price and they can sell the house before the auction.  Up until now, everyone knew that the seller had been expecting $800,000+, so buyers figured that they weren’t going to be able to buy it for the $699,000 or close – and they’d have to wait a month until the auction before finding for sure.

We didn’t change our price or strategy, and two weeks later – after buyers had a chance to re-calibrate – we had three offers and sold for $835,000.

The house across the street sold for $750,000.

For best results, list your home with Jim the Realtor!

Inventory Watch

Check out these quirky stats.

In our first two categories, the average list pricing pricing was virtually identical just three months ago:

NSDCC Active Listings

Date
# of Actives Under $1,000,000
Avg. LP/sf
# of Actives $1M to $1.5M
Avg. LP/sf
Jul 22
94
$494/sf
189
$498/sf
Jul 29
97
$493/sf
192
$494/sf
Oct 21
70
$470/sf
165
$551/sf

In the Under-$1,000,000 category, the average list pricing has dropped 5% since July.

In the $1,000,000 – $1,500,000 category, it’s gone up 12% since July!

(more…)

Solana Open House

The best open house this weekend will be down at the sand in Solana Beach, where the weather will be in the mid-to-high 70s. Check out our Old-Spanish bungalow, go surfing at Tabletops, and take a long stroll on the beach!

506 Pacific Ave., Solana Beach

Open 12-3pm

$2,995,000

I’ll be there for the full three hours today!

https://www.compass.com/listing/506-pacific-avenue-solana-beach-ca-92075/359498520290704689/

NSDCC Open Houses This Weekend

I went through the NSDCC open-house list and these are my favorites based on price, location, DOM, and agent. They start in La Jolla (four on the oceanfront!) and go north up the coast as you scroll down.

Let me know if you’d like me to create a personal collection for your search!

Statewide Rent Control Bill 1482

Governor Newsom signed Assembly Bill 1482 into law on October 8.

Quick Summary of the law:

Rent Cap

Rent increases are capped at 5 percent plus inflation, or up to a hard cap of 10 percent, whichever is lower.

All rent increases since March 15, 2019 will count toward the rent cap, and if above the permissible rent cap, will have to be rolled back effective January 1, 2020.

Just Cause

Landlords may only evict for “just cause.” There is a list of 15 reasons.

The just cause reasons are divided into two categories:

“At fault” termination of tenancy is generally based upon a tenant’s breach of the lease, among other reasons, and does not require the payment of relocation assistance.

“At fault” reasons include non-payment of rent, nuisance, criminal activity, refusal to allow entry, and breach of a material term of the lease.

“No fault” termination of tenancy is allowed when the tenant has not breached the lease and will require the landlord to pay one month’s rent in relocation assistance.

“No fault” reasons include owner occupancy, withdrawal from the rental market, substantial remodeling and compliance with government order to vacate the property,

Just cause eviction only applies to tenants who have been continuously and lawfully occupying the property for 12 months.

Exemptions

Exempts single family properties and condos if:

  • Notice of the exemption is provided to the tenants and;
  • The owner is not a REIT, a corporation, or an LLC where an owner is a corporation

Other exemptions include:

  • Housing that has been issued a certificate of occupancy within previous last 15 years
  • Owner occupied duplexes
  • Owner occupied single-family properties renting no more than two bedrooms including Accessory Dwelling Units (“ADU”s). (This exemption applies only to just cause but not the rent cap).

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