College students may be flocking to Cancun, Mexico, or Panama City Beach, FL, but a look at preliminary realtor.com® data for March makes it clear that there’s no spring break anywhere on the horizon for the real estate market.
Instead, the buying season’s annual spring jump-start came about a month earlier than usual, with homes expected to hop off the market 22 days faster than last month, or 69 days. That’s eight days faster than last year. And that’s a lot.
“Calendars might say this is the first week of spring, but we’re already right in the thick of the most frenzied spring home-buying season on record,” said Javier Vivas, manager of economic research at realtor.com.
The realtor.com economic data team analyzed our data for the country’s largest metropolitan markets to find those where buyers are clicking up a storm on our listings and where homes are speeding off the market like they’re late for a flight to the islands. These markets may seem like a tough nut to crack for buyers, but homes there are likely to be a good investment.
Maintaining its perch atop the ranking for the second month in a row is the San Francisco Bay Area city of Vallejo, followed by San Francisco itself. Mind you, when we talk about these metropolitan markets, they typically include other satellite cities—the San Francisco market encompasses Oakland and Hayward, and No. 3 Dallas includes Fort Worth and Arlington.
New to the top 20 in March were Santa Cruz, CA; Fort Wayne, IN; and Grand Rapids and Ann Arbor in Michigan. Let’s check out the rest!
They said that houses nationwide are selling eight days faster than last year. Let’s compare our own local stats to March 2016, and include our hottest frenzy year, 2013, as well:
Days on Market – March
In spite of this month’s NSDCC median sales price being 33% higher, and mortgage rates about 5/8% higher than they were in March, 2013, houses are selling faster!
In spite of healthy property-tax increases on every property sold these days, the attack on Prop 13 continues. If we have such a problem with affordable housing, can we re-purpose or sell old government properties and use them instead? H/T daytrip:
A state policy expert offered an unexpected solution to California’s housing affordability crisis: Amend Prop. 13.
Chris Hoene, executive director of the California Budget and Policy Center in Sacramento, said at a California Association of Realtors conference in Los Angeles Tuesday that local governments need to boost local property taxes to gain flexibility to address housing costs in their areas.
Because of Prop. 13, the voter-backed measure that limits tax hikes on properties until they’re sold, local governments have to raise money from development fees, which discourages homebuilding, Hoene said.
Prop. 13 also limits the local government’s ability to finance affordable housing projects while discouraging existing homeowners from making improvements such as building more units on their properties, he said.
Without saying specifically how to change the property tax measure, Hoene nonetheless said it needs to be addressed to increase local revenue.
“The obvious place to do something is on the property tax,” Hoene said. “ … It doesn’t mean that Prop. 13 isn’t the third rail of politics. It still can be the third rail of politics. But it doesn’t make sense for people to scream and yell about an affordability crisis and not take on the single biggest financing mechanism problem in the state.”
The Del Mar Castle which sits on the top of a hill overlooking the ocean and the community of Del Mar was built in 1925 by Ruth and Marston Harding who relocated from Massachusetts. The Castle contains approximately 10,000 sq. ft. including a detached guest house. It was designed by famous local architect Richard Requa who went to Europe to study the best design and returned with authentic stained glass, doors and hardware from castles in the south of Spain.
Longtime homeowners in Jersey City, N.J., are trying to put the kibosh on endless aggressive real estate solicitations sparked by a hot property market.
In response to complaints, the Jersey City Council unanimously passed a resolution creating an anti-solicitation city program referred to as a “No Knock” registry. Residents that sign up will receive “No Knock” decals for their front doors, and violators who continue to inquire at those homes can be fined up to $2,000 and sentenced to 90 days of community service.
“It’s something that we want to address and do it in a proactive way that builds community as opposed to creating conflict,” said Council President Rolando Lavarro.
The population of Jersey City, the state’s second-largest municipality, grew 6.7% between 2010 and 2015, according to the U.S. Census.
Median housing prices there have increased 17% over the last six years, to $305,000 in 2016 from $260,000 in 2010, according to RealtyTrac.
Amid the rapid residential development, longtime homeowners say that persistent offers from real-estate investors and developers have at times escalated to the point of harassment.
Assunta Folcarelli, a crossing guard who has owned her Jersey City home for 35 years, said realtors started calling her six years ago asking to buy her home. She has repeatedly declined but said solicitors continue to call, show up at her door and send her letters.
“They keep on calling up, they want my house. I say, ‘Wait a minute, where am I going to go?’” said Ms. Folcarelli, 57 years old. “It’s kind of scary.”
Michael Griffin, a lifelong Jersey City resident and local activist, supported the registry’s creation but said the city needs to do more to protect vulnerable homeowners from developers. Mr. Griffin said the city needs to educate residents about cash offers, including in several neighborhoods where many homeowners live at or below the poverty line and the old Victorian and brownstone homes are attractive to developers, he said.
“Not too many people in my community have seen that much money at one time,” Mr. Griffin said. “It may look like a sweet deal to them, but they might not be realizing the taxes involved when you take a lump sum of cash like that, or not thinking what their next move might be. Will you be able to sustain yourself just by renting? Rents in Jersey City are high.”
We’re looking forward to the no-reserve auction of Matt Kemp’s house on April 20th, and have four tickets to a Padres game for the person whose guess comes closest to the actual sales price (which will include the auction premium).
Kemp has $12,000,000 invested. Here are the guesses so far!
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Harbor Club Condominiums is a high-rise residential building in San Diego, California composed of two towers of equal height. The 41-story towers have a height of 424 feet (129 m) and are a prominent fixture in San Diego’s skyline. Located in the Marina district of Downtown San Diego, Harbor Club was designed by architects BPA Architecture Planning Interiors. The condos are located near the San Diego Convention Center and Petco Park. The towers are currently the eighth tallest buildings in San Diego and were completed in 1992.
After five months of flatsville, our local non-seasonally adjusted San Diego Case-Shiller Index took off in January, up 0.8% month-over-month! It was the highest increase of any metro area! We usually see the biggest pops in spring, so stay tuned.
Blitzy doesn’t have to worry about breaking the internet with these thoughts:
“Housing and home prices continue on a generally positive upward trend,” said David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices.
The actions by the Federal Reserve raising the target for the Fed funds rate by a quarter of a percentage point is expected to add less than a quarter percentage point to mortgage rates in the near future, Blitzer said.
“Given the market’s current strength and the economy, the small increase in interest rates isn’t expected to dampen home buying. If we see three or four additional increases this year, rising mortgage rates could become concern,” he said.
“[The auction] is going to be a better route for bringing legitimate interest to the property,” said Nartey, the director of sports entertainment division at Compass. “It’s an opportunity for someone to get an asset for less than its actually worth.”
The “asset” in question includes a 15,884-square-foot main house, a tennis court and an infinity-edge swimming pool on about 4 acres of grounds. A separate pool/guest house holds a gym and a roman spa.
Features of the home, which Kemp has spent about $3 million to update, include custom travertine floors, a cigar lounge with a humidor and a 1,200-bottle wine cellar with a tasting room. A custom home theater is outfitted with tiered seating and a snack bar.
Our local home prices have risen so quickly that it feels like we’re in ‘bubble’ conditions again – could the bubble burst this time?
The last two times the real estate bubble has popped, it was due to banks having to offload their foreclosed properties for whatever the market will bear. They flooded the market, and buyers – and prices – backed off.
But that has all changed now.
Look at the new devices being used to avoid a flood of desperate selling:
New accounting rules.
California Homeowners Bill of Rights
The accounting rules were altered so banks could hold their REO properties longer, and the California Homeowners Bill of Rights has, in effect, stopped foreclosing. Lenders are now required to offer a loan modification to anyone in default, and only if the homeowner can’t or won’t qualify are they at risk of being foreclosed. With today’s higher rents, there isn’t much relief for those in default to give back their house and go lease one nearby. Besides, with our higher home values today, they can always sell before getting foreclosed.
Homeowners who need money can get a reverse mortgage too, as long as they haven’t been tapping into their equity already.
We end up with virtually no desperate sellers who need to dump on price. Someone who wants to cash out quickly can price their home at last year’s comps and look like a deal!
The game is rigged – the Banking Cartel won’t let the bubble pop again!
For the bubble to pop, we would need a dramatic shift in the supply and demand – either a flood of homes hit the market, and/or we run out of buyers.
I thought we’d be seeing more baby boomers unloading their homes due to downsizing or sickness, and while the market consists mainly of those listings, there aren’t enough of them to call it a flood – at least not yet. Because they are in quality locations, more kids are probably trying to buy out their siblings and take over their parents’ house, rather than sell it. They could be moving in with the folks too, rather than sending them to assisted living.
Could we run out of buyers? You would think there would be a price point where buyers can’t or won’t go any higher, but there seems to be a steady flow of people with more horsepower. We saw two weeks ago the prediction that the population of San Diego County is expected to grow by 700,000 people by 2050, which is over 21,000 per year – where are they going to live? Will they be rich? They will need to be!
There hasn’t been enough (has there been any?) sellers so desperate that they had to dump on price – instead, they just keep waiting. We would need more than a few price-dumpers to start a panic, which could cause the market to flood with supply and burst the bubble.
Some air might escape occasionally, but it is doubtful that a market change could occur without the government finding a way to save the bankers.
People like this guy think the conditions are ripe for a downturn. But if prices started falling, sellers are more likely to wait, than dump, which would cause our market to stagnate, rather than crash.