He mentioned the slightly-negative turn in pricing last month, but I like these two graphs above. The pricing trend is going to bounce around – as long as we have sales counts close to previous years, we’ll be fine.
Hey, we had our first monthly increase since June!
Last year the index readings topped out in July, and if that pattern repeats, it will mean that today’s home prices will be the highest of the year.
San Diego Non-Seasonally-Adjusted CSI changes:
Over the last week, we’ve seen soundbites on how home prices declined in Southern California and San Francisco for the first time in seven years, but they are talking about the median sales price – which declined a measly 0.1%. Expect the talking heads to focus on up or down only.
We’re going to be lucky to keep pace with last year’s monthly increases:
Last year the February month-over-month increase was 1.1%, and this year it was only 0.1%. But because the focus is so binary (up or down only), we might escape further scrutiny as long as we can hit a +0.1% each month.
But it’s pretty likely that our local year-over-year readings are going to go negative next month – right as the selling season wraps up. Winter might start early this year!
With less than 24 hours to go in the REO auction, it looks like the seller got a little antsy and decided to push the bidding closer to their $1,499,900 list price. Will there be a flurry of activity right at the finish line? We’ll see!
This is a real estate blog, and I’m going to plow ahead. Let’s keep living!
Here’s a fascinating example of the current market conditions between La Jolla and Carlsbad, and it shows that it’s not just about price.
Today there are 62% more homes for sale priced under $1,000,000 than there were last year – you can buy a cheaper home! But buyers want quality – look at how the average list-price-per-sf of the pendings relates to the actives:
NSDCC Actives vs. Pendings
# of ACT
# of PEND
This is why pricing will likely plateau – people are willing to pay these prices if they can just get a suitable home. They are making their decisions based on location, condition, and schools, and are willing to pass on inferior homes even though they could save some money.
Buyers are decisive too, and are willing to act when they see the right fit. Look at how the average days-on-market compares:
NSDCC Actives vs. Pendings
# of ACT
# of PEND
The higher-end buyers are being very deliberate, but the rest are acting!
Wells Fargo foreclosed on this Carmel Valley home in November. It had been listed on the MLS for the previous 12 months, and it looked like the agent had been trying to process a short sale (it was marked ‘contingent’).
She had it listed for $1,500,000.
Her clients paid $1,650,000 in 2007, and financed $1,137,500 with World Savings. Times were tough for many, and these folks got their notice of default filed in August, 2010. It doesn’t look like they made any payments since.
Wells Fargo’s amount at the trustee’s sale was $1,365,016, which is typically the amount owed. So the former owners got a couple of hundred thousand dollars in relief, but waved bye-bye to their down payment of $512,500.
Wells Fargo then listed the house for sale in January for $1,499,000, and has now sent it to an online auction. The bidding started yesterday, and will remain open until Tuesday:
The auction website also notes that it needs to be a cash purchase, though it’s not mentioned in the MLS listing. The buyer has to pay a 5% buyer’s premium on top of the purchase price, and I assume they want you to close escrow with the occupants inside?
What will somebody pay for the home, under those conditions?
The current bid is $1,199,920, though note sure if that is actually a real offer or just the minimum bid.
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