Four strong months in a row – at this pace, our local Case-Shiller Index will rise about 10%-12% this year! This is the non-seasonally-adjusted index below. The seasonally-adjusted was slightly higher at 237.79.
David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, said the April increase in prices shows demand for homes is rising but the supply of homes has hardly kept up.
“The question is not if home prices can climb without any limit; they can’t,” Blitzer said in a statement. “Rather, will home price gains gently slow or will they crash and take the economy down with them? For the moment, conditions appear favorable for avoiding a crash.”
San Diego Non-Seasonally-Adjusted CSI changes:
The highest reading of the San Diego NSA CSI was 250.34 in November, 2005.
The most-recent low point was 144.43 in April, 2009.
McMansion Hell is a Tumblr blog that highlights the absurdity of giant real estate properties and the ridiculous staging and photography that are omnipresent in their sales listings. The blog, started by 23-year-old Johns Hopkins graduate student Kate Wagner, began in July 2016 as a way to poke fun at pretentious architecture. It has since gone viral, but now she’s facing potential legal charges by real estate site Zillow for allegedly violating the site’s terms of service by reproducing the images on her blog.
A typical McMansion Hell blog post will have a professional photo of a home and/or its interior, along with captions scattered throughout by Wagner. She also adds information about the history and characteristics of various architecture styles, and uses photos from the likes of Zillow and Redfin to illustrate how so many real estate listings inaccurately use the terms.
Under each post, Wagner adds a disclaimer that credits the original source of the images and cites Fair Use for the parody, which allows for use of copyrighted material for “criticism, comment, news reporting, teaching, scholarship, and research.” In a cease and desist letter to Wagner, Zillow claims Wagner’s reproduction of these images do not apply under the Copyright Act. Additionally, the company claims McMansion Hell may “[interfere] with Zillow’s business expectations and interests.”
Zillow got sued for using photos without authorization, so now they are going after the little people with a vengeance? Where will they stop?
When a buyer’s agent calls the listing office to inquire about making an offer, the usual response is, “Send it in, and we’ll get back to you.” More questions don’t reveal much else, and the buyer’s agent is left wondering if there is any hope of selling a house.
There is big money being thrown around these days, and how your listing agent operates determines your fate. Sellers should hire a agent who demonstrates what they do to sell your house for top dollar, not just process your paperwork.
With so much focus on HGTV real estate shows, it’s inevitable that our marketing will go Hollywood too:
A woman in a red dress twirls with a dark and mysterious man through light-filled hallways. Music flutters and surges in a romantically lit courtyard overlooking the twinkling city. A mischievous coda plays, and then the credits roll.
It’s a classic scene plucked straight from Hollywood. But this eight-minute mini-movie is far from a silver-screen blockbuster. It’s a real estate advertisement for an $8.5-million, 1.5-acre compound in Encino:
Successfully marketing a mansion now requires much more than panning shots from an iPhone or even expensive videos shot by drone. Real estate agents with luxury listings are now experimenting with full-on property movies — films featuring actors, story arcs, scores and Tinseltown-caliber cinematography.
“The classic old-school walking tour of the house is becoming more and more obsolete — with all the content that’s thrown at us these days, it’s hard to hold someone’s attention with that,” said Kristine May, who directed the Encino shoot and owns If I May Films in Woodland Hills. “People get attached to a story, and they want to stick around and see what’s happening.”
So what if the narrative and performances are sometimes more Razzie than Oscar? Real estate agents contend that movies showcase their properties in a way that helps buyers envision themselves there.
Real estate agent Ben Bacal, an early innovator of high-gloss property films, worked with married clients Ori and Nafisa Ayonmike to craft a $20,000 film to market their home in Hollywood.
The Ayonmikes star in a fictional narrative that begins with Ori skulking through the sleek, contemporary rooms of his 5,500-square-foot, five-bedroom estate. In the next 11 minutes, Ori tells Nafisa he wants a divorce, a passionate fight ensues, Ori gets kicked out and Nafisa chucks her massive diamond ring into the pool.
Amid all the high drama, production company Rafiki captures the home’s 20-foot ceilings, high-tech security system, marble fireplaces and tony Hollywood Hills neighborhood. The video of the property listed at $3.65 million has generated nearly 61,000 views since being posted on YouTube last year.
Online video platforms have become a key component in property sales. Some 36% of home buyers used YouTube, Vimeo or another video hosting website in their search last year, despite only 8% of real estate agents using film in their marketing strategies, according to the National Assn. of Realtors.
Bacal posted another movie trailer-esque listing video last year for a Bel-Air property, in which two children develop Ferris Bueller fevers and spend the day playing hooky. The pair splash in their infinity pool, shoot golf balls over the Los Angeles skyline from their lawn, try on outfits in their generous closets and have a puppy delivered by drone.
The 14,230-square-foot spread sold in December for $39 million.
Typically, the filmmaking cost is covered by either listing agents, sellers or both. Movie-style real estate videos can cost anywhere from $5,000 to upward of $30,000 to make, directors estimated.
The N.A.R. Chief Economist Lawrence Yun was befuddled in his previous press release, and now this:
“Home prices keep chugging along at a pace that is not sustainable in the long run,” Yun said. “Current demand levels indicate sales should be stronger, but it’s clear some would-be buyers are having to delay or postpone their home search because low supply is leading to worsening affordability conditions.”
Yunnie is an old-fashioned guy who relies on historical norms. But more people are probably thinking the same – this run-up in pricing isn’t sustainable.
Or is it?
We are in an environment where we are peppered with lottery ads daily. People dream about getting rich quick, and selling your house is about the closest most people get – and it’s not enough just to sell your house for an all-time record price. Instead, every seller wants more than the last guy got.
Won’t there be a point where we run out of ready, willing, and able buyers? Yes, but unless a seller NEEDS to move, they aren’t going to budge. They aren’t going to lower their price until they are absolutely convinced that they must – and it’s more likely that sellers will withdraw their listing and try again later.
If sellers do need a solution, there are more alternatives than ever:
Once we reach the point where the market stalls, it will stagnate for years until sellers and realtors realize they must adjust their price to sell. Realtors themselves struggle to accept the rules of supply and demand – they just keep hanging onto their listing until the market catches up.
Rising rates, economic downturns, political drama, world calamities – none will be as influential as a seller’s ego when it comes to adjusting on price.
Watch the number of sales – they are the precursor. If/when sales start to decline, all it means is that fewer sellers are willing to adjust enough on price.
Will their reason for moving be powerful enough to not seek an alternative, and sell for what the market will bear? It’s doubtful, and as a result, a market that is this hot will take time to re-calibrate – if it does at all.
"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... more "
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