History has shown that the real estate market is guided by a set of fundamentals. Could history change course?
Maybe, and if so, it will be a result of how the buyer pool keeps filling with of first-timers, multi-generational buyers, multi-national buyers, investors buying the bottom 5%-10%, and move-up-or-downers – all while the supply is going in the opposite direction – fast:
Captions provided for my own speaking at end!
Jim Klinge
Klinge Realty Group
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Contact Jim the Realtor!
CA DRE #01527365, CA DRE #00873197
Trustindex verifies that the original source of the review is Google. We sold a home with Jim and Donna and from beginning to end they were consummate professionals. Their initial walk through the property resulted in a list of items to be repaired or updated. They supplied a list of vendors and job quotes to do the repairs and updates. We originally wanted to sell ‘as is’ and just get it over with. They gave us a selling price for ‘as is’ and options for doing a few updates/repairs to doing it all with the selling price for each option. We agreed to do all they suggested and we sold for the exact price they predicted. For every dollar spent we got back more than $2 back in the selling price. And they got that price in a rising interest rate environment! Donna and Jim are extremely detailed and guide you through ever aspect of the sale. There were no surprises thanks to their guidance. We couldn’t be more pleased with their representation. Thank you Donna and Jim, Jerry and MaryTrustindex verifies that the original source of the review is Google. We have known Jim & Donna Klinge for over a dozen years, having met them in Carlsbad where our children went to the same school. As long time North County residents, it was a no- brainer for us to have the Klinges be our eyes and ears for San Diego real estate in general and North County in particular. As my military career caused our family to move all over the country and overseas to Asia, Europe and the Pacific, we trusted Jim and Donna to help keep our house in Carlsbad rented with reliable and respectful tenants for over 10 years. Naturally, when the time came to sell our beloved Carlsbad home to pursue a rural lifestyle in retirement out of California, we could think of no better team to represent us than Jim and Donna. They immediately went to work to update our house built in 2004 to current-day standards and trends — in 2 short months they transformed it into a literal modern-day masterpiece. We trusted their judgement implicitly and followed 100% of their recommended changes. When our house finally came on the market, there was a blizzard of serious interest, we had multiple offers by the third day and it sold in just 5 days after a frenzied bidding war for 20% above our asking price! The investment we made in upgrades recommended by Jim and Donna yielded a 4-fold return, in the process setting a new high water mark for a house sold in our community. In our view, there are no better real estate professionals in all of San Diego than Jim and Donna Klinge. Buying or selling, you must run and beg Jim and Donna Klinge to represent you! Our family will never forget Jim, Donna, and their whole team at Compass — we are forever grateful to them.Trustindex verifies that the original source of the review is Google. WeI had the pleasure of working with Klinge Realty Group to sell our home in Carmel Valley, and I cannot recommend them highly enough! Jim and Donna demonstrated exceptional professionalism, offering expert guidance on market conditions and pricing strategy, which resulted in a quick and successful sale. Communication was prompt and we were well-informed throughout the entire process. For anyone looking for a dedicated and knowledgeable real estate team, look no further! ---Trustindex verifies that the original source of the review is Google. Donna and Jim Klinge of Klinge Realty Group have our highest possible recommendation. From Donna and Jim’s first visit to our house through closing their advice and counsel was candid and honest in all dealings. They kept us fully informed throughout the process. The house sold less than three days after listing with a two-week closing. My wife and I have sold several houses during our lives. This was by far the best experience. Klinge Reality is a premium service realtor. You can’t make a better choice for someone to sell your home fast and for top dollar.Trustindex verifies that the original source of the review is Google. Donna and Jim provided exceptional support and professionalism throughout the entire process. We couldn't have been happier with their efforts. They made our house shine, and thanks to their expertise, it sold above the listing price in the very first weekend! Truly a fantastic experience from start to finish.Trustindex verifies that the original source of the review is Google. This year has been difficult on our family, mainly due to having to sell our home. Thankfully we knew God had a plan for us and working with the Klinge team was a key part of it. It was an obvious decision to work with them again after such an amazing experience when purchasing the same home we needed to sell. The challenge was, how will we do this in so little time with so much going on? Jim and Donna held our hand every step of the way. Whenever an unexpected issue arose they found and provided a solution. Never once did we feel pressured to make a decision and the Klinges were always reassuring after providing the information that the decision was ours to make. Despite the curve balls, they never panicked and exemplified the “can do” attitude, making us feel optimistic and taken care of. Their expertise and professionalism was superb. But of all the reasons to work with the Klinges, the most impactful and valuable is their compassion and genuine care for their clients. We pray that we can one day purchase our forever home and you better believe that Jim and Donna will be representing us - as long as they will have us of course. Thank you again Klinge team! Your execution, experience, and care are unmatched.Trustindex verifies that the original source of the review is Google. Jim and Donna were fantastic! Jim understanding my needs, recommending potential places, pointing out the pros and cons of each property was invaluable. Then when the offer was accepted Donna’s organized guidance through the inspections, paperwork etc made the whole process seem effortless. So grateful that I had them on my side!Trustindex verifies that the original source of the review is Google. We first found Jim through his blog at bubbleinfo.com, which really showcased his knowledge of SoCal real estate. Since then we've done three transactions with Jim and Donna, and they are an incredible full service agency, with Jim's deep market insight and Donna's deft contract and project management. We trust them implicitly in their analysis and strategy, which is based on years of experience. They're always available and on top of things, and we strongly recommend them to anyone.Trustindex verifies that the original source of the review is Google. The Good The Klinge Realty Group operates like a finely tuned machine, with a very personal touch. We contacted them on a Sunday and they were talking to us about our family and our needs on our living room couch the following day. They carefully listened to us and worked with us to identify the best and quickest path to listing within 2 weeks to take advantage of the low inventory conditions in our South Carlsbad neighborhood. They knew our tract specifically and had many previous sales there over the years - they came prepared with a thorough analysis of comparative sales and recommended a pricing strategy that they felt confident would yield offers the first weekend on the market. The Great Over the next two weeks Donna coordinated a range of vendors who she knew from experience could get the preparation to list work we needed done on time and with high quality. Our light tune-up involved excellent experiences with their stagers, landscapers, contractors, electricians, and plumbers. Throughout this period Donna's daily communication was clear, concise, and responsive. Any time we had questions Donna picked up the phone or texted immediately - but almost always, she answered our questions before we even knew we had them. The Outstanding We had a tricky situation with a shared fence that could have delayed our escrow. Donna used superb mediation skills to negotiate the terms of replacement and was personally on site with the fence contractor to make sure everything went smoothly. The fence looks great and escrow closed on time. The Truly Exceptional Our house came on the market on a Wednesday and between then and Monday morning Jim was personally at all three open houses. He was in constant communication explaining potential buyer reaction and strength. As he predicted offers began to come in on Saturday and each one was incrementally higher than the last. At the end we had 5 offers, 4 of which were over list, and the final accepted offer was $100,000 over list. In addition to being over list it included rent back terms that met our needs. The Recommendation For all of these reasons we would strongly recommend The Klinge Team to anyone wanting to sell in North County Coastal San Diego. I had been reading Jim's bubbleinfo.com blog for 15 years and knew when the time came to sell that he would be our first call. Jim Klinge is not your standard realtor. He is keenly aware of market conditions and sales strategies. And, works his tail off - though not as hard as Donna . At this point he's gone from realtor to friend and I plan to have him over to grill and chill at our new place to talk real estate, but also just about life and raising kids in San Diego. He's more interested in relationships than his sales numbers - and that's why his sales numbers are so high. We have already recommended the Klinge's to some close friends and another successful sale is on deck right around the corner...Trustindex verifies that the original source of the review is Google. We recently had the pleasure of working with Jim and Donna from Klinge Realty Group to sell our house, and we couldn't be more satisfied with the experience. From the initial meeting, they listened attentively to our needs and provided invaluable guidance on specific improvements to get our home market ready. Their responsiveness throughout the entire process was truly impressive. Anytime we had questions or concerns, they were quick to address them, ensuring we felt comfortable and informed every step of the way. What stood out the most was their team and extensive network of tradespeople, which made addressing any necessary repairs or updates seamless and stress-free. Thanks to their expertise and dedication, our house sold quickly and at a great price. We highly recommend Jim and Donna to anyone looking to buy or sell a home. They are a fantastic team who truly care about their clients and deliver exceptional results.Load more
I think you were almost there !!
NEED MORE NEW HOMES.
Else you have to tell people they have to move to another state when they retire.
As long as you can get 30 year money in the 4’s and even 5’s, and as long as you can get 5/1 and 7/1 money in the low 3’s (and even high 2’s still), the new fundementals will play. An extra 100k is only 425-500 a month. Throw in the international money and buy and hold investors that signed long term leases and happy with the cash flow and appreciation (and where are their tenants going to go? If you think it is bad trying to buy a house, try to find someone a decent rental), and demand will be there for awhile. Pile on with the fact that as long as buying conditions are tough, the casual move up or down buyer will be dissuaded from even giving it a go. I’ve noticed a lot more construction guys with new trucks lately; makes me think that remodel and stay in place is become more attractive than moving (there is some hard scientific data for ya). Now for kicks, lets talk about what happens is inflation kicks in…..
During the periods when the economy is in a bubble fundamentals don’t matter. In the late 1990’s PE ratios and other stock valuation measurements didn’t matter because of the internet revolution. In the 2003-2006 fundamentals didn’t matter because home prices always went up and neg am loans where a great product.
Essentially my opinion is “the new normal” is just this bubbles “it’s different this time” rationalization. When does it end? Who knows, bubbles pop when they pop. I figure in the next 2-3 years this “New normal” will be paying the price for ignoring the fact that the fundamentals didn’t really change that much. Housing may fare better than other assets classes when the next bubble pops. That’s certainly debatable. Muni bonds did pretty well during the last blow up.
Fundamentally a couple things have indeed changed though. Demographics and investment into residential real estate will have some effect on the market. I don’t think it’s enough to overcome traditional factors such as income, interest rates, debt ratios, etc. San Diego as a retirement destination for the wealthy? Maybe that does trump macro fundamentals for specific regions in San Diego County.
I’ll give you one more on lack of supply. This is not new fundementals, it is a reversion to old fundementals. The idea that you should keep moving and keep buying up and churn your house like it is an investment was a 20 year fad. We are now heading back to old fundementals. Buy a nice house to live in, get comfortable with your life and kids and neighbors, and live. Kids can move in or sell it when you are gone.
Imagine anyone thinking this post was possible even 2 years ago.
I look at this blog entry in combination with the prior two on CV and Chinese buyers to get a sense of the new fundamentals generated by the inflow of international buyers. San Diego buyers face serious challenges due to lack of new construction, remodel > move-up trend, and significant international interest layered on top of domestic interest in the area. It’s a tough combo of factors for buyers. Not sure when if ever there will be any significant relief.
I agree – and think that any rate bump won’t be that detrimental to the exclusive areas.
Buyers have already shrugged off higher rates and prices like they were a flesh wound.
This article is trying to shed some light on new fundamentals:
http://www.mortgagenewsdaily.com/05052014_corelogic_insights.asp
Fleming said the housing and financial crisis has forced the industry to come up with new measurements for events and activities that were not previously monitored such as negative equity and shadow inventory. Now he says we need to pay attention to obsolescence. “Maybe the reason that home sales aren’t increasing is because buyers can’t find anything they want to buy. More viable homes for sale are needed to draw this demand out of the shadows.”
In a second article, A New Source of Shadow Inventory, the economist maintains that the definition of the term should be expanded to include non-distressed existing homeowners who have no incentive to sell because the prevailing mortgage rate is higher than the mortgage on their existing home. Roughly half of the 50 million mortgaged homes in the U.S. have below-market-rate mortgages and if as conventional wisdom says, homeowners typically sell once every seven years, there may mean 3.57 million likely sellers who will not list their homes because the cost of financing a new home will be higher.
Fleming says that adding these “rate-disenfranchised sellers” to the traditional shadow inventory results in a new estimate of 5.27 million homes as of January 2014. Compared to one year ago, when the interest rate was 4 percent, only 28 percent of potential sellers or 2 million might have been dissuaded from listing, expanding that shadow inventory from 2.2 million under the traditional definition to 4.2 million homes.