The San Diego Case-Shiller Index is 6.2% higher than it was 12 months ago (October to October readings), which beats just about everyone’s expectations.
But the tony north-coastal region (La Jolla to Carlsbad) had already experienced healthy price gains since 2012. At the beginning of 2015, lower mortgage rates (3.5% to 3.75%) fueled a surge of sales at higher pricing, but then things mellowed out the rest of the year – just like Rob Dawg predicted!
If it weren’t for the blip in November, it would be clear that the first quarter of 2015 was the best time to sell, price-wise. If we do get more inventory this year, the same will probably be true – more houses for sale combined with higher mortgage rates = more of a buyer’s market.
We saw last week that the annual count of NSDCC detached-home sales already exceeds the 2014 total. By the time the sales from this week are recorded (and the late-reporters chime in) the 2015 sales will be about 5% higher than last year’s count – in spite of higher pricing!
Higher prices = more sales??
More sales = higher prices??
The additional action was made possible by more homes coming to market.
New-Listings Count – Annual, 2nd Half, and 4th Qtr:
Annual # of Listings
# of Listings, 2H
# of Listings, 4Q
Incr over 2014
All signs are pointing to the inventory increasing next year – will a larger selection of homes for sale inspire more buyers to buy?
If so, it means more sales – and a faster rate of appreciation if each sale is slightly higher than the last.
Or will a surge of over-priced listings cause the market to stagnate? If there are more OPTs stacking up, it makes it more obvious to buyers that the prices are wrong.
I think 2016 will be the most interesting yet – especially if we get mortgage rates bumping up faster than expected!
Some months we are going to have a set of homes sell that, as a group, were inferior to previous sets and won’t pull the same prices.
Or the market is falling apart, take your choice!
The non-seasonally adjusted CSI for San Diego showed -0.32% decline in October, the first decline all year (the seasonally-adjusted number was +0.2%). But it isn’t the end of the world – last year there were four times that the NSA number declined, month-over-month.
Here are the San Diego NSA changes for 2015:
The national headlines conveniently focused on happy talk, and reported the Y-o-Y stats, and the seasonally-adjusted month-over-month calcs. No mention in this article that SEVEN of the 20 cities showed a M-o-M decline of the non-seasonally adjusted numbers:
Not just anyone can get in to see Michael Jackson’s former Neverland ranch, which is for sale at $100 million.
Vetted billionaires and high-end real estate agents have been among the few to tour Sycamore Valley Ranch, as the 2,700-acre spread in Los Olivos is known.
But on Monday morning NBC New’s “Today” show is offering the next best thing, a virtual tour in which correspondent Joe Fryer looks at features from the late King of Pop’s day. Among them are the international superstar’s floral clock, train station and movie theater.
The host made a mistake and said 2,700sf in this video – it is 2,700 acres:
Most national forecasts are predicting a 3% to 4% appreciation rate for 2016, which has to be a safe bet. If it comes in anywhere from -2% to +8%, you can say that you were close.
Zillow has enough algorithms that they are willing to make predictions for each local area. They have conflicting numbers, depending on where you look on their website – these are from the Home Values section:
You can see that Zillow was less optimistic last year too. Most were predicting that mortgage rates would be in the mid-4s by now, so the lower rates in 2015 helped fuel higher-than-expected prices. Could rates stay right where they are? Maybe, but both Zillow and I think the euphoria will die down next year:
Zillow Price-Appreciation Predictions
For some reason, Zillow is also labeling each market from Warm to Very Cold. The labels don’t seem to correspond to the predictions, so I don’t know their intent – are they just trying to tell you to put on a sweater?
How will buyers feel about getting worked over for that last 2% to 3% when they see they are in a ‘Very Cold’ market?
A very typical Christmas week around the NSDCC region, where the median list price today is a whopping $2,195,000!
We have the glutty higher-end where the average market time is 144 days (and still unsold), and a lower-end that is cleaned out! The 59 active listings under $800,000 is the lowest count since we started keeping score.
The Christmas Week symmetry:
Click on the link below for the complete NSDCC active-inventory data:
Want to guess when the best time will be to sell your house in 2016?
Let’s reflect on recent history.
The Big Frenzy of 2013 was super-charged by mortgage rates dropping into the low-3s during 4Q12. The low point for the 30Y conforming rate was 3.31% during the week of Thanksgiving.
It skewed the sales history of early 2013 higher, but then rates started rising which tempered the market. By the time we got into 2014, rates had to decline most of the year just to keep the market afloat. Those two histories are unlikely to be duplicated in 2016.
Rates were back into the 3s by the end of 2014, which helped 2015 get off to a good start – and now rates have muddled through the rest of this year.
Because of the highly-publicized Fed hike this month, home buyers have to be thinking that it’s time to buy – before rates go higher. The Fed has threatened to raise rates throughout 2016, which should cause buyers to be very active early on.
As a result, let’s compare our 2016 market expectations to 2015 – the recent sales history that will be most-likely to repeat.
These are the weekly counts of NSDCC detached-homes that have closed escrow, based on when they were marked pending. Starting in mid-October, I included the listings that are currently marked pending too, figuring that they have released their contingencies and should be closing soon.
Once the Super Bowl is over, the motivated buyers really get busy. You can see that February, 2015 was one of the best months of the year to find a buyer.
This year is wrapping up nicely, with the 4Q15 action being better than 3Q15. It should provide a solid foundation for early 2016.
Let’s consider the difference between wanting to sell, and having to sell.
If you really needed to sell, you probably got it done in 2014 or 2015. Prices were hitting all-time highs, and the motivated sellers weren’t going to wait around any longer.
The 2016 sellers are more likely to be the lesser-motivated, “if-I-get-my-price” sellers. It will be irresistible for them to tack on that extra 5% to 10%, just in case, and by the end of spring we could see the OPTs stacking up. I thought it might happen like that in 2015, but it didn’t so who knows. But one of these years the buyers will have had enough.
Jim the Realtor is legit - I interviewed three brokers; he said list price should be $100,000 higher than the other two brokers; listed it with him and had all cash (no financing) offer in two days, five day contingency period, closing in two weeks - and it closed at his recommended list price. I could not recommend anyone more than I recommend Jim the Realtor.
When we moved to San Diego in 2005 we rented a big house on Mt. Soledad (La Jolla) with 180 degree ocean views for the same payment as a mortgage on a dump in Chula Vista. Clearly something was wrong. Yet, the media was full of the usual happy-talk nonsense, so I was glad to find Jim's blog. I've followed his honest assessments and data since.
We decided to sell and move to AZ at Thanksgiving. Dec. 1st we met with Jim to sell our home. We closed today (29 days later). Jim orchestrated a feeding frenzy -- we had 25 showings in 2-1/2 days, multiple offers, and sold for well over asking price. I'd say he earned his commission! We have owned and sold homes in 5 different States always using experienced, productive, full-time realtors. Jim outshines them all.
You don't decide to sell and close 29 days later over Christmas (with COVID lockdown) without some miracles. Donna was amazing at performing lots of those miracles and ensuring that everything was done right and on time. They are a terrific team with a very responsive and professional network.
Where do we begin..2020 has been a year for everyone. When COVID hit and shut down both my husband and my businesses, we were left with a mortgage and very little income coming in. We were stressed, scared and felt stuck. We made the hard decision to sell our home and move out of state. We contacted the Klinges' and spent a good hour going over what we hoped we could accomplish. Jim and Donna came over with comps in hand and suggestions on improvements to get our house ready for the market. It was overwhelming to think about, but Donna was there and one step ahead in every scenario. Basically we just approved what they suggested and Donna handled literally everything. We placed our house on the market and within the first day we had multiple offers well above asking price! We couldn't believe it. We were overjoyed! Jim countered the offers to weed through them, and everyone came back with way more. It was amazing, and we are ?? sure it was because of the staging and repairs the Klinges suggested we do.
Due to unforeseen dishonesty from the buyers lender, we hit a big hurdle when trying to close. We had already moved out of state and were shocked when three days before closing the lender dropped a bombshell on the buyers and us. However, Jim and Donna handled it like veterans, not afraid to play hard ball and represent their clients. After a few phone calls with us, and several between Donna and the lender, they had a plan B-Z to make sure we were taken care of. In the end we closed with even more money than we ever thought possible and with very little work from us. The Klinges handled this entire "2020" worthy event with the utmost professionalism and did everything in their power to not only make this as smooth as possible for us, but we also walked away with more money from the sale of the house than we ever hoped for. After working with Jim and Donna, you don't ever use anyone else. They are hands down the best team to represent you in any scenario.
Working with Klinge Realty Group was a great experience! They are very responsive, professional and knowledgable about the real estate market! I would definitely recommend Klinge Realty Group.
Jim and Donna Klinge made the sale of our condo extraordinarily easy. They know the market and gave us sound advice backed by details and very considerable experience, reflected both in the initial pricing and subsequent negotiations. They work together as a team and are always available to talk. We had a few challenges with our property and they were able to coordinate the resolution to everything, including items that I would not think would ordinarily be their responsibility to handle. They made the whole process effortless on our part. They are folks with high integrity and we cannot recommend them highly enough.
Review for Member: Donna Klinge
I cannot believe there are no reviews of Donna yet, ugh!! She is the secret sauce of the Jim Klinge/Donna Klinge combo! I will touch on Jim here, but Donna is why I'm so totally loyal to these two (no offense to Jim :)).
I consider myself a rather savvy buyer/seller. I've bought/sold 7 times in about 15 years. On the buy side, Jim is the PERFECT combo of: completely digitally savvy (he will pull data all day long until you feel comfortable with your chosen house, area, school district, anticipated appreciation rate...anything!), he's super well respected and known in the area by other agents, an amazingly cool but strategic negotiator, is totally devoid of desperation for a sale/commission, and more.
Then once you get into contract phase, Donna literally handles every last and final detail in a concierge-like manner -- totally shielding you from the daily back and forth, noodling and annoyances of the buyer's requests. She solves it ALL; it's miraculous what that woman accomplishes over and above what is even expected in a buy/sell transaction.
On the sell side, Jim and Donna do the same, but even moreso. Donna in particular truly takes everything off your plate: she'll manage getting the house painted, the carpets replaced, she'll go on site (as she Jim both did for me when selling our rental properties) to work with the renters and make sure the house is ready to show -- freeing me to have to take time off of work to do so. They work with A+ integrity, too, so you know you are serving all parties fairly and lawfully throughout.
A home purchase/sale is the most considered you'll ever make. HIRE A SAVVY AGENT, not a friend!, and get what you need out of the transaction. Jim and Donna are our agents for life.
Jim and Donna Klinge are by far the most professional, personable and responsive realtors I have ever worked with. They provide VIP concierge level service in every area of the process of selling your home. My home was marketed so successfully that we received an offer the day after our first and only open house. Thanks to Jim's pricing and negotiating, our house is now the highest sold in our community. Jim's vast experience means he has worked with several realtors and knows the market all over north county. Donna is AMAZING in processing everything in the transaction. She scheduled trades people to work on the house in preparation for the sale as well as the repairs needed before closing. She communicated clearly every step of the way about what would be happening. She took the weight off my shoulders for the whole process. I will always use Jim and Donna for my future real estate needs and I whole heartedly recommend them to anyone buying or selling a home.
Jim and the team at Klinge Reality are without a doubt the best in the business! Not only was Jim helpful and extremely knowledgeable, he was patient and determined to help me find my first home. Jim and his team have been in the business for many years, and it shows. Jim is a wealth of knowledge and was my biggest proponent despite the temperature of the competitive market. I ended up getting the perfect property in my dream neighborhood all thanks to Jim. From the day my offer was accepted, Donna was a real lifesaver. She was extremely helpful, responsive, and knowledgeable when it came to every minute detail, and held my hand through the process. As a first time home buyer I had no idea what the process would entail, but Donna curtailed every concern I came across and made the escrow process feel seamless. Jim and Donna provided me the best home buying experience, and I am very grateful for all they did for me. It was truly a pleasure to work with Jim and Donna and I am already looking forward to the next time we work together!
Review for Member: Richard Morgan
Richard is an amazing realtor! He has high integrity and genuinely cares about his clients and their needs. Richard paid close attention to what I was seeking in a home and was very patient in our search to find it. I would highly recommend Richard and will use him for future transactions. Truly a different kind of realtor experience!
Could not be happier with my experience with Jim and his team. He helped me sell a very unique and challenging property. Throughout the entire process he was always available, honest, transparent, trustworthy, and always put my interests as a seller first. A (rare) true professional! During close of escrow Jim went above and beyond to complete the deal. It would not have been possible without his experience, fantastic team, and pure dedication. Highly recommended!
Thanks Jim and Donna Klinge!