Game On!

by | Oct 19, 2016 | Jim's Take on the Market, Real Estate Investing, Thinking of Buying?

4040-porte-la-paz-82-005_web

The 2br/2ba condo we are discussing in the UTC area is in a complex that enjoys high rents – this unit should fetch $2,000 per month easily.  Because of the quirk in the underwriting guidelines that won’t allow financing in condo complexes that have an eminent-domain action filed, we are looking for cash buyers only – hopefully an investor will find the rent appealing!

The previous buyer was anticipating a close-of-escrow date this week – we were at the finish line.  The seller wants to go back to renting the unit if we don’t find another buyer by Monday!

I marked the listing as ‘active’ again this morning, and I’ve already received two phone calls from agents!

We will be there 12-3pm for open house on Sunday too!

http://www.zillow.com/homedetails/4040-Porte-La-Paz-UNIT-82-San-Diego-CA-92122/52514005_zpid/

Higher Prices = Harder to Sell

by | Oct 18, 2016 | Jim's Take on the Market, Thinking of Selling?, Tips, Advice & Links, Why You Should List With Jim | 1 comment

harder-to-sell

As home prices increase, buyers get more picky – and it makes sense.

If they have to pay more, then they want more for their money.

This should have some lasting effects on the market:

  1.  The sellers who upgrade their home to sell will be rewarded.
  2.  The gap between the turn-key homes vs. fixers should widen.
  3.  The home-selling failure rate will increase.

The stats show that we’ve had more listings this year, but fewer sales:

NSDCC Detached Homes between Jan-Sept.

Year
Total Sales
Total Listings
Sales/Listings Ratio
2013
2,554
4,091
62%
2014
2,183
3,930
56%
2015
2,362
4,068
58%
2016
2,273
4,187
54%

Yes, the ‘re-freshing’ of listings does pad the Total Listings count, but it’s been a constant problem and helps to make the point – it’s getting harder to sell.

For sellers who don’t want to lower their price, there is an easy answer.

Do more to upgrade your home!

This is why financed buyers should consider a fixer – there is less competition, especially from cash buyers who have a better shot at the hot buys.

Home Buyers Paying Cash

by | Oct 17, 2016 | Jim's Take on the Market, Market Buzz, Market Conditions, North County Coastal

cas

Back in the foreclosure era, cash buyers were everywhere, gobbling up all the deals. Many pundits thought that once the investors pulled out, the market would collapse.

But a funny thing happened on the way to the apocalypse.

It turns out, buyers love to pay cash!

They are buying the higher-end properties too, which is understandable – nobody is spending their last million or two on a house.  These cash buyers probably had at least 5x the sales price in the bank!

NSDCC Detached-Home Sales, First Nine Months (Jan – Sept.)

Year
Cash Sales
Median SP
Non-Cash Sales
Median SP
Cash %
2009
290
$1,105,500
1,290
$781,000
18%
2010
400
$1,007,500
1,485
$800,000
21%
2011
426
$1,032,500
1,554
$805,000
22%
2012
551
$975,000
1,771
$795,000
24%
2013
639
$1,015,000
1,915
$925,000
25%
2014
579
$1,283,600
1,604
$950,000
27%
2015
603
$1,878,158
1,759
$1,000,000
26%
2016
614
$1,402,500
1,659
$1,090,000
27%

The depth of the affluence isn’t surprising, it is the breadth.  There have been 1,465 NSDCC house sales that have closed for more than $1,000,000 this year!

It puts pressure on the financed buyers. In virtually all bidding wars, the financed offers are ignored, and just the cash offers get entertained. Financed buyers would be smart to lower their sights and pick off a fixer.

Zillow 2017 Forecasts

by | Oct 17, 2016 | Carlsbad, Carmel Valley, Del Mar, Encinitas, Forecasts, Jim's Take on the Market, La Jolla, Rancho Santa Fe, Solana Beach, Zillow

2017-la-jolla

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

It’s that time of the year – the 2017 forecasts are starting to roll out!

Zillow has been conservative about our local markets.  For the most part, the actual appreciation of the Zillow Home Value Index has been higher than their forecasts over the last two years.

Their local forecasts for 2017 are all lower than their 2016 guesses, and what they are predicting could also be described as ‘Flatsville’.  If their local forecasts of +0.9% to +2.2% come true, it would mean that several sellers would end up selling for less than they could have gotten in 2016.

Are we ready for that yet?

Local ZHVI-Appreciation Forecasts

Town
2015 Forecast/Actual
2016 Forecast/Actual
2017 Forecast
Carlsbad
+2.7%/+4.8%
+1.9%/+3.8%
+1.3%
Carmel Valley
+0.3%/+5.4%
+1.4%/+1.9%
+0.9%
Del Mar
+5.5%/+1.1%
+1.4%/+2.6%
+1.1%
Encinitas
+0.6%/+8.3%
+2.4%/+6.3%
+2.2%
La Jolla
+2.7%/+6.6%
+2.3%/+6.1%
+2.1%
RSF
+0.4%/+11.1%
+3.7%/-0.5%
+1.9%
San Diego
+1.7%/+6.4%
+2.1%/+4.0%
+1.7%
Solana Beach
+2.7%/+6.4%
+2.2%/+2.6%
+1.4%

The Zillow data changes slightly, depending on where you look on their website, and whether you use town names or zip codes. Here is the LINK to find others.

encinitas-2017

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Inventory Watch

by | Oct 17, 2016 | Inventory, Jim's Take on the Market

2016-10-15-14-37-24

We rebounded from last week’s 46 new pendings – we had 60 this week!

I want to go back to my last prediction too.

I thought I said that September was hot enough that we would have more sales than August, but my actual guess was that we would beat last September – and we did! (246 sales this September vs 210 last September).

Click on the ‘Read More’ link below for the NSDCC active-inventory data:

(more…)

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