Happy Anniversary

We’ve heard all the hubbub about higher mortgage rates having a negative effect on the real estate market.  But the non-taper has caused rates to come back a bit – we are now down around 4.375% for 30-year conforming rates.

For those who had their heart set on having payments lower than what you get with a 4.375%, 30-year mortgage rate, then there are options available:

  • Buyers can pay more points to lower their rate.
  • Buyers can have the sellers buy down their rate.
  • They can take an interest-only loan, instead of fixed-rate.
  • Buy a cheaper house.

Or, in this cash-happy environment, they can borrow less:

Microsoft PowerPoint - 2013 Florida Saltmarsh Conference [Compat

The stir-up from higher rates might cause some changes in the buyer psychology, but the baseline problem hasn’t changed – there aren’t any great buys available, and even the decent buys are loaded with compromise.

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We’ve wrapped up eight years of www.bubbleinfo.com!  Thanks for participating, and most of all, thank you to those have become clients. 

I do this to demonstrate my abilities, and want to help more people buy and sell homes.  If you, or someone you know, is thinking of moving, I’d love to hear from you!

SD Case-Shiller Index – July

The non-seasonally-adjusted SD index moving at a less-torrid pace:

Month
M-O-M
Y-O-Y
March ’13
+2.0%
+12.1%
April ’13
+2.8%
+14.7%
May ’13
+3.2%
+17.3%
June ’13
+2.8%
+19.3%
July ’13
+2.0%
+20.4%

“Home prices gains are holding their 12% annual rate of gain established by the two Composite indices in April,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “The Southwest continues to lead the housing recovery. Las Vegas home prices are up 27.5% year-over-year; in California, San Francisco, Los Angeles and San Diego are up 24.8%, 20.8% and 20.4% respectively. However, all remain far below their peak levels.

More on SD Inventory

Bill at CR brought up today how the national inventory of active listings has “bottomed”, and is trending upward:

http://www.calculatedriskblog.com/2013/09/weekly-update-existing-home-inventory_23.html

The group of “unsolds” has been growing in San Diego too – from the Department of Numbers (who had a glitch in their system in July):

http://www.deptofnumbers.com/asking-prices/california/san-diego

February was the lowest inventory ever recorded, and now we are +21.4% higher – but still well-under the previous seven years on the graph.

The number of total listings inputted year-to-date is in check also.  Last year at this time, we had 48,100 total listings inputted, and in 2013 we are at 51,000 – only about 6% higher.

In the post below we saw that the lower-end market is what’s really constrained. If it weren’t for all the high-enders sitting around having a cigar, our market would feel like the Sahara Desert!

Total SD Sales (detached & attached) from Jan. 1 to Sept. 15th:

2012: 26,105 @ $231/sf average

2013: 27,439 @ $278/sf average (+20%)

Inventory Watch – SP:LP

To give you an example of pricing accuracy, let’s compare today’s list prices to the average $/sf of last month’s solds.

There were 227 detached homes that sold under $1,200,000 last month, and they averaged $381/sf – and today’s list prices are averaging $398/sf, which is only a 4% spread.

There were 103 houses that sold over $1,200,000 last month, and they averaged $555/sf – but today’s list price average $776/sf!

Yes, the smaller and more-likely-to-be-tract-houses are easier to valuate and have a wider audience. But it demonstrates how treacherous the pricing is for the higher-end folks – both buyers and sellers.

The UNDER-$1,200,000 Market:

Date
NSDCC Active Listings
Avg. LP/sf
DOM
Avg SF
April 29
201
$384/sf
36
2,599sf
May 5
195
$381/sf
36
2,633sf
May 9
207
$387/sf
35
2,624sf
May 18
241
$397/sf
33
2,566sf
May 23
236
$397/sf
34
2,529sf
May 30
230
$391/sf
35
2,591sf
June 5
229
$393/sf
35
2,577sf
June 11
239
$390/sf
34
2,569sf
June 17
246
$389/sf
36
2,577sf
June 24
255
$397/sf
36
2,535sf
July 1
244
$401/sf
38
2,526sf
July 8
256
$398/sf
38
2,530sf
July 15
269
$403/sf
38
2,486sf
July 22
258
$401/sf
39
2,442sf
July 29
262
$386/sf
39
2,493sf
Aug 5
287
$393/sf
38
2,495sf
Aug 12
300
$391/sf
40
2,521sf
Aug 19
304
$395/sf
41
2,491sf
Aug 26
308
$392/sf
41
2,469sf
Sep 2
304
$395/sf
41
2,453sf
Sep 9
303
$402/sf
40
2,453sf
Sep 16
309
$395/sf
39
2,463sf
Sep 23
311
$398/sf
40
2,431sf

The OVER-$1,200,000 Market:

Date
NSDCC Active Listings
Avg. LP/sf
DOM
Avg SF
April 29
620
$806/sf
94
5,183sf
May 5
606
$806/sf
93
5,223sf
May 9
628
$808/sf
93
5,150sf
May 18
653
$807/sf
92
5,161sf
May 23
661
$814/sf
92
5,141sf
May 30
659
$805/sf
95
5,222sf
June 5
663
$794/sf
96
5,185sf
June 11
672
$779/sf
96
5,163sf
June 17
661
$787/sf
99
5,164sf
June 24
679
$791/sf
98
5,097sf
July 1
705
$785/sf
94
5,084sf
July 8
702
$779/sf
95
5,100sf
July 15
736
$776/sf
94
5,038sf
July 22
748
$782/sf
96
5,043sf
July 29
736
$782/sf
100
5,057sf
Aug 5
754
$765/sf
100
5,024sf
Aug 12
750
$767/sf
102
5,032sf
Aug 19
742
$769/sf
104
5,009sf
Aug 26
740
$781/sf
106
4,962sf
Sep 2
736
$773/sf
107
4,928sf
Sep 9
724
$781/sf
108
5,006sf
Sep 16
738
$773/sf
107
4,993sf
Sep 23
736
$776/sf
109
4,953sf

I’ve been mentioning the $/sf of all NSDCC solds this month, because in the first couple of weeks it was hovering around $500/sf. Today it is down to $479/sf, but still well above last month’s $436/sf.

Almost all of the increase is in the Over-$1,200,000 market, which is where you can get some wild fluctuations due to the product mix.

Weekly NSDCC New Listings and New Pendings

Week
New Listings
New Pendings
May 30
70
84
June 5
87
64
June 11
77
69
June 17
73
66
June 24
100
69
July 1
86
64
July 8
81
53
July 15
106
54
July 22
105
89
July 29
71
74
Aug 5
105
64
Aug 12
77
61
Aug 19
88
73
Aug 26
87
77
Sep 2
76
55
Sep 9
85
58
Sep 16
102
61
Sep 23
84
54

Tomorrow the Case-Shiller Index for July will be released.

Peak Pricing Vs. Now

Here are the statistics from North SD County’s Coastal region (La Jolla to Carlsbad), comparing house sales closed between June 1st and August 31.

In some areas, the summer of 2007 was just as hot as the previous year, but for the majority, the highest average pricing was in 2006 – let’s compare it to the summer of 2013 (DOM = average days on market):

Area or Town
2006#
Avg $/sf
DOM
2013#
Avg $/sf
DOM
Cardiff
20
$581
49
26
$519
45
Carlsbad NW
43
$437
77
57
$378
35
Carlsbad SE
126
$319
58
188
$300
28
Carlsbad NE
35
$322
65
34
$282
34
Carlsbad SW
58
$357
55
85
$327
32
Carmel Valley
116
$390
58
148
$373
28
Del Mar
36
$662
61
60
$705
40
Encinitas
115
$431
57
150
$453
32
La Jolla
73
$856
72
91
$704
45
RSF
75
$680
108
82
$488
91
Solana Beach
21
$640
52
29
$558
43
NSDCC
718
$484
66
950
$436
38

In Del Mar and Encinitas, the average cost-per-sf was higher this year than in 2006. Carmel Valley and South Carlsbad were both within 10% too.

Anyone with a pulse could get a mortgage in 2006, yet look at how the number of sales is higher now in almost every area!

We talked yesterday about the average days on market, and whether the faster sales are a result of market efficiency, or outright desperation on behalf of the buyers – it’s probably some of both?

Del Mar Comparison

The listing on Forest, a 1,516sf house built in 1946 and in original condition, gets mentioned in the video below. It was listed for $2,089,000 when it went pending, and here’s its video tour: http://youtu.be/4Wh8yDkgXfU

This new house is about 1/2 mile away from Forest, as the crow flies – they had just lowered their price on Thursday from $2,325,000.

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