The other two neighborhoods I mentioned as “superior homes” to watch were Davidson’s Starboard tract in La Costa Oaks, and the old beach community, Terramar. How are they doing?
The number of sales have been low, and data scattered in both areas.
Here are the same-house sales in Starboard, listed in chronological order of their resale date, with the only three 2008 sales in bold:
Sales Price, New
Resale Price, Date
$1.007, 11/07 REO
$900K, 6/08 REO
The second REO sale had listed for $849,000, and the agent already had the buyer standing by at $900,000 – it went pending the first day, and could have sold for more.
There is an active short-sale listing of a 3,743sf plan, listed on the range $949,000 to $1,049,000, and a PENDING 4,398sf plan, listed for $1,549,000 to $1,649,000.
I think this is going to be typical in the prime areas from now on – lower short-sale or REO listings closing under the trend, interspersed with primo listings going for top dollar. The future sales depend on how many homeowners can’t hang on – about half of them had equity in the 0-20% range.
Terramar has been beating the odds.
In May of this year, there were three different 1,500sf houses sell in the $800,000s on El Arbol and Los Robles, similar to sales in 2005.
There have been two shockers lately too.
The nutty 1,399sf house with a studio over the garage on the non-oceanfront side of Shore Drive closed for $1,600,000 cash to an Arizona buyer. It had sold in 2002 for $750,000.
And the 2,760sf house at 5390 Los Robles closed at $1,225,000 to a buyer from Simi Valley on 9/4/08. I had it listed for $349,000 in 1995 and couldn’t sell it – everyone thought I was crazy. The owner finally did get lucky and sold it for $762,500 in August, 2003.
The fewer sales in both areas help illustrate the difficulty for buyers looking for prime properties – do you keep waiting for lower prices, or take your shot when you have it, because of the few choices available?
I said that ‘superior homes’ might only lose 5-10% of their value, but inferior homes were likely to get clobbered, losing 40% to 50%, resulting in a combined blended loss of 33% in median home price.
Here was the justification:
Three general reasons the high-quality properties will do better:
1. They’re older houses, owned by older people, with less debt.
2. They have it so good, there’s no better place to go.
3. Buyers are holding out for the good stuff.
Because of these three reasons, the supply-and-demand curve is much more healthy in the high-quality-home market.
I was vilified by most of the commenters, one in particular, the infamous powayseller. It might have been the impetus for her to finally start her own blog?
Rob Dawg calmly offered, “I’ll buy you that $4 cup of coffee if you can find anything that isn’t off at least 10% from the peak this time next year.”
So I took the challenge, and mentioned three neighborhoods (Terramar, Olde Carlsbad, and La Costa Oaks – Davidson tract) that I thought could beat the odds. When we reviewed them a year later and put it to a vote, I came out slightly ahead.
Where do we stand now?
Let’s start in Olde Carlsbad – 92008
For those who know Olde Carlsbad, I think you’ll agree that it’s a mixed bag – many older, smaller SFRs interspersed with new or remodeled houses and estates, many with ocean views. Determining values is always a challenge around 92008, but you decide.
Here are the same-house sales that have closed in 92008 since June, 2008:
1295 Cynthia 3 br/2 ba, 1,400sf YB:1960 short sale
$615,000 10/05 $411,000 9/08 Difference = -33%
2728 Forest Park 4 br/3 ba, 2,248sf YB:1985 REO
$647,000 6/04 $435,000 8/08 Difference = -33%
1726 Forest Ave 3 br/2 ba, 1,900sf YB:1962 REO
$545,000 8/04 $535,000 7/08 Difference = -2%
(former owner pulled a $720K loan and did full remodel, then had medical prob)
3255 Monroe 4 br/2 ba, 2,124sf YB:1964 REO
$700,000 7/05 $575,000 6/08 Difference = -18%
2051 Laurie 4 br/2 ba 1,937sf YB:1960 flipper
$460,000 2/08 $616,500 7/08 Difference = +34%
(seller/agent did full remodel, probably made $20-40K after costs)
450 Anchor 3 br/2 ba 1,877sf YB:1982
$655,000 7/06 $650,000 6/08 Difference = -1%
(buyer exchanged into this year’s purchase, paid all-cash)
5111 Delaney 4 br/3 ba, 2,856sf YB: 2004
$885,000 8/06 $875,000 6/08 Difference = –1%
3912 Garfield 2 br/1 ba, 832sf YB:1940
$850,000 8/05 $853,000 6/08 Difference = 0
2168 Dickinson 5 br/4.5 ba, 3,043sf YB:2004
$758,000 5/04 $915,000 9/08 Difference = +21%
(new in 2004)
2178 Twain 5 br/4.5 ba 3,737sf YB:2004
$727,000 1/04 $1,030,000 6/08 Difference = +42%
(new in 2004)
155 Chinquapin 4 br/4 ba, 2,292 sf YB:1990
$1,200,000 2/04 $1,225,000 9/08 Difference = +2%
There were 79 sales closed since June 1st, and these eleven purchased since 2004. The remaining 68 who purchased in 2003 or earlier all sold for more than they paid.
If you are Jan Terry, owner of this house at 2872 Vista Acedera in La Costa Valley and Jenae’s co-conspirator, you pull out all the stops.
First it was to try their lease-option program, hoping to find a renter willing to cover her roughly $9,000/month obligation. But no takers.
Then she tried the typical short sale strategy, starting with a list price of $1,100,000, which was slightly under her purchase price of $1.25 million, which she financed 100% in April, 2007. She eventually lowered it down to $890,000, but then cancelled the listing.
Now she has reverted to the last resort. We think she must have sent in a short-sale offer to the bank to postpone the trustee sale, which was scheduled for July 17th.
In the meantime, she has rented the house to 14 surly individuals who come and go at all hours, night and day!
The HOA says they can’t do anything. Carlsbad P.D. says they might tow this car that they park around the corner, but that’s about all they can do.
The neighborhood has already suffered from this inflated sale, which contributed to others paying too much – now the impending foreclosure of a house that is surely in disrepair will help tank values further. Thanks Jenae!!!
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