Inventory is rising, houses aren’t selling, yet list prices don’t seem like they are coming down much.
It sounds like the Big Standoff.
Let’s compare to this year to 2009, which had the hottest spring activity since 2005.
Here are the early July detached-listing stats for the La Jolla-to-Carlsbad region, compared to 2009:
| July 1 to July 15 | 2009 | 2010 |
| New Listings | 249 | 263 |
| New Pendings | 100 | 89 |
| Closings | 84 | 84 |
| Closings $$/sf | $399/sf | $390/sf |
The 100 new pendings from last year have all closed, with 86 of this year’s 89 count still in escrow – but there are 141 marked contingent that will supplement the current pendings that fall out, and there will also be some late-reporters – let’s call it 89 for now?
Up until the end of June the 2010 stats comapred very favorably to last year, but now conditions look a little jittery – there are a total of 1,652 active listings currently, and only 241 closed in the last 30 days (and 84 in the last 15 days). I think we’ll see more signs of a slowdown, at least until sellers start lowering their list prices. Some aren’t far off, probably only 5% to 10%, but they’re getting stale quickly. Others need a 10% to 20% reduction just to get in the game.
Could we run out of buyers? Price will fix anything.
Lost 2 buyers here. We’ve decided (i.e. our wives have decided to allow us) to sit it out awhile, as has another NCC buyer in our circle. We’re both in the low/mid $1mm price point and feel no rush.
The other former buyer came to his conclusion 100% on their own. He’s an international stock guy so we operate in different worlds.
Would like to see if a) gov gets more involved around election time, and b) if they cheeze it up again heading into next spring.
Off the hook till next fall!
WHAT? AAhhhhhhhhhhh!
Your wife is seething – I better talk to her.
Sellers that don’t need to sell have been testing the waters. If they can’t get their price, they let the property sit. They will try to hook Clearfund and his buddies next year, when prices will surely go up, at least that’s what the sellers think.
Around here (Silicon Valley) things are also slowing. Seeing a number of listings by sellers who now have lost their grip on the edge of the ledge to which they were clinging. All the cash is gone and they have stopped making payments. My neighbors got their NOD a month ago and have been prepping the house for sale for the last 6 or 8 weeks. It went up at a price that might have worked in March, but probably is too high now. Unemployed, their house will go, one way or the other.
You’ve mentioned recently about frustration from buyers. In areas I am looking, I am not seeing prices come down significantly. For example, your own listing on 710 Cathy Ln is listed at $115-140k more than peak price (last sale Nov 2005):
http://www.sdlookup.com/MLS-100042625-710_Cathy_Ln_Cardiff_CA_92007
Maybe a topic for future blog posts: Do some areas have strong enough demand to be immune to declining prices? Should buyers wait for a correction from “bubble prices”? Or will it never happen?
I’m starting to see prices come.
I’m also starting to hear back from short sale sellers that laughed at the offers I gave them 6 months ago.
There’s A LOT of houses that are technically for sale but not on the MLS becasue they’re trying to do short sales.
Here’s another trend to watch…
Used cars are getting cheap really fast. My guess is that just like with homes car owners are looking to downsize.
I agree with Shadash.
I’ve notice a lot of price pressure on McMansions; whereas smaller sized homes that are expensive due to sitting on prime real estate are holding their own. In other words, homes that have their value based primarily on their squarefootage and “upgrades” seem to be coming down in price much more than homes that have thier value primarily based on their location.
So all 100 “pendings” from last year closed escrow? Or did some of them fall out of escrow and not sell? It would be good info to know how many didn’t sell (if any).
Too damn hot!!!!
Travis,
Thanks for mentioning Cheese’s new listing:
http://www.710CathyLane.com
Is it possible for an area to dodge the bubble bullet? Maybe, but only small areas, like a few streets-worth, or a bunch of blocks. It is mostly due to lack of sales though.
Carmel Valley is the litmus test, and while I think CV residents would admit to some general price re-trenchment, there are areas that are the same or higher than peak. (the cheaper areas in particular)
Derby Hill is a recent high-end tract, the type that have had trouble elsewhere, but DH is steady – currently. They’ve had low turnover though, only one or two for sale at a time.
Jim, you went to the “value range” pricing? Say it ain’t so!
Not me man, that’s Cheese (Jim Cheeseman), he is an independent agent working under the Klinge Realty mega-banner.
I still don’t like anything about the range-pricing, especially in this market.
Just like the booties, I don’t want to risk setting off any buyer. Many are used to the rage-pricing and don’t give it a thought, but others get confused or ticked off, and why would you do that when it’s not necessary? Appeal to the masses.
I know Local Boy is OK with booties, but I have seen guys wearing $500 shoes look at me in complete disbelief when some nutty agent insists that he takes them off to walk on crappy carpet. Plus what happens when you want to go out back? Return to the front door to pick up shoes, do the shoe shuffle again at the back slider – or just say screw it and walk around on the wet grass and bring wet/dirt inside anyway, booties or not.
Haha – thought I could bust your chops on one!
Who do you think is the prime candidate to buy that Cathy house? Retirees/empty-nesters looking to downsize? I imagine it’s too small to be attractive to a family with multiple kids, and too expensive to be a starter home.
JTR has an agent named “Cheese”…the irony is outstanding!!!
That’s a nice house, but houses in that area are selling in the 500s. It will be interesting to watch that one. We almost a house on that same street last spring (820 Cathy) but couldn’t handle the freeway noise. It sold for 492K.
We have Cheese though.
The ironing is delicious (Homer Simpson-ism).
You all have been busy with the cheesy thing…I see. The current owner’s of 710 Cathy Lane have poured 180K in updating since 2006. It will be open tomorrow afternoon 1-4pm. It’s a good test for a turn-key property vs the other fourteen active listings that are 40-50 years old east side of I-5 in 92007.