We’re past the holiday season, the Chargers have checked out, and February is ten days away.
Let’s review current market conditions:
Trustee Sales for North SD County Coastal SFRs (Carlsbad to La Jolla)
There are more properties on the NOTS auction list (444) than on the NOD list (337), which at casual glance might make you think we’re winding down.
But the NOTS list is loaded with a rolling group of old defaulters that get postponed each month – 82% of the properties on the auction list have had at least three postponements.
SINCE DECEMBER 1st:
New NODs: 122
New NOTSs: 88
Trustee Sales: 67
Trustee-Sale Cancellations: 75
MLS sales: 312
(255 regular, 35 REOs, 22 short sales)
The slow-drip system is working beautifully for the banks. Virtually all of the 444 auction properties have had a sale date since December 1st, yet only 142 had some resolution (32%), and that’s being kind – many of those cancelled will be getting back in line.
The blob of defaulted properties is impeding the foreclosure channels with delays and uncertainty. Buyers hoping to snag a trustee-sale deal will need to be very patient.
We are following twenty properties that already had sale dates this month, and only one ended up on the ‘steps (sold to a third party), and the rest postponed.
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Neg-Am Recasts
We’ve all seen the charts, there are $134 billion in option-ARMs that are expected to recast over the next two years. About 1 out of 3 option-ARMs are delinquent or in foreclosure now, so we’ll see boatloads of short sales and REO/flipper properties being offered for years to come.
How many in your area? I’m going to try and obtain more breakdowns by zip, but the last count showed that 5.5% of the properties with mortgage in Encinitas, Carmel Valley, and RSF had a neg-am or option-ARM.
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Flippers Are Active
With the lack of quality inventory available, flippers have an open playing field. But with postponements dominating the court house steps, there are only 1-2 trustee sales per day being bought by a third-party of properties from Carlsbad to La Jolla, which doesn’t sound like much. But when compared to December’s total of 238 SFRs sold on the MLS, we could see flippers wind up being 10% (or more) of the market in 2010.
I’m working on the count of recently-flipped properties.
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Sandicor’s New Public Website
Our local MLS provider, Sandicor, has had a new public-MLS website “in development” for the last two years, and should be ready in the next few months. According to sources, all they need to do is determine how to brand it, and who is going to pay for it – though that sounds nebulous.
The Houston Board of Realtors has pioneered the public-MLS, including a realtor-feedback feature, which Sandicor is considering. I heartily recommend it, as realtors we need to provide a way to police ourselves.
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Recent MLS Sales
Just in case there was some influence on early-December sales from the tax credit, here’s how the Dec 15 to Jan 15 period compares to previous years:
The basic sales stats look decent, in spite of the calamity.
The properties with multiple postponements might be in the “Trial Mod” process??? I know someone who was approved for the “Trial Mod” program in October and he has been making his new payment as agreed every month since. His property has been listed to go to auction in October, November, December, twice in January and now ir is once again postponed until mid-February. Postponed 6 times so far and he is doing everything that they have asked for.
Agreed that loan-mods-in-progress must be a primary reason for many defaulters to be on the list, and I can’t think of a way to verify the quanity.
What if a majority never come out the other end?
What if a majority never come out the other end?
It’s a program sponsored by “gov” money. The current administration will give deadbeats money just to show the program is a success.
I was an early advocate of buying at the trustee sale. The areas I follow are the OC and IE.
I have been there when the trustee sales where over-priced(99% back to the benny) to spring of 09 when there were about 20% fair priced for wholesale buying, to the current market 85% postponed due to trial mods ( mostly extended forebearnce) active short sales, and bkcy.
The short sale is in vogue right now, and the local agents are all doing “inside deals” to investor groups/ relatives who are set up in “pre-arranged short sales”.
Fraud and corruption have become the standard operating practice in the real estate industry.
I really wish you the best JTR in your trustee program, but you may be better served marketing short sale listings and creating a fair ebay style marketplace for your loyal followers and clients.
Hey Jim, just curious why you excluded Oceanside and Vista from this North County update. Does it skew the numbers too much in one direction? And if so, which direction?
The loan modification program is a joke.Forclose on these homes and get them on the market to real buyers.Real estate has turned into socialism.
The comments below were posted on Trulia.com on 1/22/2010 regarding the SD real estate market.
Tread lightly in the beach areas, especially any high end real estate. Take one stroll down Ocean Front Walk and you will know what I mean. High End Coastal Real Estate ($700,00+) is still over priced and will take a 15-20% hit over the next 2 years. On the bright side, Ocean Beach is under developed and is probably the most affordable outside of Oceanside and Imperial Beach. However, budget is really the key thing here. It seems like feast or famine in Ocean Beach. There are some good fixer opportunities in the $1,000,000 plus range, but you will have to be patient and ready to go when the right home comes up for sale. I think if you are heart set on Ocean Beach, you should try to find 2-4 unit building. Ive seen some places that pencil out nicely just blocks from the beach. You can find that in many beach communities..
Golden Hills his is truly one of the those pocket neighborhoods that is hard to judge and has always been limited on well priced homes in the “good” pockets… These days, most buyers prefer the South Park area due to its trendy art and botique restaurant scene..
Finally, whatever he does, STAY AWAY FROM CONDOS!!! Restrictive financing guidelines and lack of PMI will be the kiss of death in the condo market this year.
Hey osidebuyer…Vista and Oceanside are its own realty-reality micro market. People don’t want to read about reality, they like their realty bubble world! When things get under $200.00 per square foot the Carlsbad to La Jolla folks think it must not be a safe place to live, too many minorities and a barrio.
O-Side and Vista don’t have to drop below $200/sf for people to think those thoughts.
Mission Beach oceanfront homeowners are still dreaming. There are 40 properties including condo for sale. Plus another 10 at San Juan Place/oceanfront. People are not lowering prices on the oceanfront. But they are in the courts.
Recent comp for on the court in South Mission on Capistrano Place. 2 bedroom house with a 1 bedroom above the garage. sold for 1.525 million in 2007. across the street same type 2 bd. plus 1 bed sold for 850,000 last month.
I don’t get many inquires about Vista, and none for Oceanside. Might be some opportunity?
I’m checking 92057 for the flipper count though, it’s flipper heaven.
Since an early thread mentioned Cardiff teardowns I thought I’d mention a slight blip in the Cardiff market.
These two “teardowns” had the same list price of $599k and sold for approximately the same price in 2005 but recently closed for vastly different prices:
http://www.sdlookup.com/MLS-080084802-2348_Manchester_Cardiff_CA_92007
http://www.sdlookup.com/MLS-080084797-2356_Manchester_Cardiff_CA_92007
A 150k differential in price for essentially the same building lot with closing dates differing by 1 month.
The charts green and purple bars appear to be trending back towards each other. It looks like the air is coming out of the bubble.
“Houston Board of Realtors has pioneered the public-MLS, including a realtor-feedback feature”
I’ve seen you advocate this for some time. Is there a rule or regulation that says you can’t do this on your own site? Have a section on your site that lists the properties you’ve sold and the feedback you got from the clients? You can either point clients to your site for feedback submission, or hand them a feedback form upon closing and put up scans of those.
I have testimonials.
I’m not worried about the good guys, it’s more for identifying the bad guys.
Currently there is no enforcement of any rules, regulations, laws, or nothing. Realtors must find a way to effectively police ourselves, because nobody else is going to do a good job at it.
The last I heard, complaints at the DRE have an 18-month waiting list.
Pricing is simple. Take the marginal areas of N. County and pay 1.5X – 2X the price to live in a better neighborhood. How quick is that for pegging a price?
“as realtors we need to provide a way to police ourselves.”
With absolutely so slight to JTR this might be the most hilarious thing I’ve ever seen posted. Is Jenae still working? Realtors policing themselves is the last thing the profession needs. The profession needs a good fumigation but that won’t happen either.
All of which is to say, like so many things, a declining general reputation and respect is probably the best most realtors can hope for. A few, such as yourself, will distinguish yourself as individuals, partners and friends. You’ll stand above the fray. But for most, used house salespeople is the best they can aspire to and frankly, it’s a well deserved, if not overly generous moniker.
In Encinitas yesterday I saw a black BMW with license plate Home Sold (not in those letters). I really bad taste came to my mouth. I often wonder how many Realtors are keeping in touch with their clients between 2005 and 2007? Perhaps they are off in search of new clients after they turned and burned the previous? Jim is the exception.
would love to see the Sandicor public MLS! Wondering if they will share everything such as solds and pendings?
What would a Sandicor public website feature that Redfin doesn’t already?
@12 Re: the two cardiff properties on Manchester
I took a look at those a few months ago. The smaller one that sold for 675k seemed to be in better condition so maybe the buyer bought it thinking they could fix it up and live in it as is? The property next door was in worse condition so maybe it was bought as a tear down for less (525K). Just a guess.
But 150K difference just shows how out of whack Cardiff prices are.