The housing market has been looking slightly better over the last few month and Freddie Mac July economic report reflects that fact. They also maintain a fairly rosy picture of the economy as a whole.
They note that the 30-year fixed-rate mortgages (FRM) dipped below 4.0 percent at the end of May and has remained there “amid concerns over trade disputes, a possible economic slowdown, and market anticipation of a Federal Reserve interest rate cut.” This has caused a spike in mortgage applications for both purchase and refinancing and they predict that low rates, along with a thriving labor market, will help sustain the housing market, not just short term, but for at least the next year and a half.
They have, in fact, revised down their quarterly forecasts for mortgage rates over that period, forecasting an annual rate for the 30-year fixed-rate mortgage of 4.1 percent this year and an even lower 4.0 percent in 2020.
As to other rates, while not predicting a cut in the Federal Funds rate after today’s Federal Open Market Committee (FOMC) meeting, they still expect “cuts” in the second half of the year and project an effective rate of 2.3 percent in the third and fourth quarters with an average of 2.4 percent for the year, unchanged from their earlier forecast. The average next year will be 2.3 percent in 2020 and they see no further FOMC cuts.
The lower rates will turn investor interest towards more lucrative stocks and away from government bonds they say, and forecast that the 10-year Treasury rate will decline to 2.3 percent in 2019 and stay at the same level in 2020. Also, maintaining the spread between government bond yields, they see the 1-year Treasury rate to be 2.2 percent in both 2019 and 2020.
They say the strong homebuilder confidence and lower mortgage rates will lead to a recovery of housing starts and sales from their 2018 slump and that housing starts will end this year at 1.26 million and increase to 1.34 million in 2020. Home sales will be 6.0 million in 2019 due to the continuing shortage of inventory but will return to 2017 levels of 6.12 million next year.
The recent home price reports have sent mixed signals, but the report’s authors expect home prices to rise by 3.4 percent this year. They have revised their expectations for next year down to a 2.6 percent appreciation rate.
Here’s the official announcement, but the WSJ said that bringing in Dragoneer probably means that the IPO is getting close:
On Tuesday, Compass announced its $370 million Series G round of fundraising at a valuation of $6.4 billion — a 45% increase in valuation in 10 months. This brings its total capital raised to more than $1.5 billion.
New and returning investors cited Compass’ consistent growth, proven scale across the largest real estate markets, and proprietary technology as the key reasons why they invested. They view Compass as uniquely positioned to build a real estate platform that makes the search and selling experience intelligent and seamless to deliver superior results for you, the Compass client.
This round of financing positions Compass to:
Fuel our technology investments and advancements, including hiring additional Product & Engineering talent and accelerate software development, such as our upcoming launch of a revamped consumer search experience, which will help me get the best offer for your home.
Further invest in programs like Compass Concierge, which empowers home sellers to sell their home faster and for more money by fronting the cost of home improvement services like staging, painting and more, which will help sell your home faster and for a better price.
This investment brings us steps closer to realizing our mission to help everyone find their place in the world, and I am excited for this next chapter!
Q: Why did Compass decide to raise more capital?
A: Funding from investors makes it possible to invest in our proprietary technology to create a next generation platform for home transactions and ownership, and also to support other programs such as Compass Concierge, which help us empower our agents and grow the company.
As with past rounds, the decision to fundraise was not made due to lack of capital. We will use this funding to drive investment in industry innovations that attract both sellers and buyers to the Compass platform, delivering superior results that, in turn, empower our agents to grow their business.
Q: Who are the investors?
A: Participating investors include a select group of longstanding partners and new investors including Canada Pension Plan Investment Board (CPPIB), Dragoneer Investment Group, Softbank Vision Fund and Qatar Investment Authority (QIA), among others.
Q: Why did investors decide to invest?
A: New and returning investors cited Compass’s consistent growth, proven scale across the largest real estate markets, and proprietary technology as key drivers of their investment. They view Compass as uniquely positioned to build a modern real estate platform making the search and selling experience intelligent and seamless to deliver superior results for buyers, sellers and their agents.
“If mortgage rates remain near recent lows, we could see prices pick back up as a result of improved affordability as well as the possibility of more limited inventory available,” said Danielle Hale, chief economist for Realtor.com.
The supply of homes for sale had been rising for much of this year but flattened in June. Some are predicting inventory will be lower again this fall. That is causing more competition in the market.
“Homes are selling at a breakneck pace, in less than a month, on average, for existing homes and three months for newly constructed homes,” said Yun. “Homeowners’ equity in real estate has doubled over the past six years to now nearly $16 trillion. But the number of potential buyers exceeds the number of homes available. We need to see sizable growth in inventory, particularly of entry-level homes, to assure wider access to homeownership.”
Regionally, the Realtors’ pending home sales index rose 2.7% in the Northeast month-to-month and was 0.9% higher than a year ago. In the Midwest, the index grew 3.3% monthly and 1.7% annually. In the South, the index increased 1.3% monthly and 1.4% annually. In the West, pending sales jumped 5.4% monthly and were 2.5% higher than a year ago.
They should identify the locations so homebuyers are aware:
Sober living homes have become a contentious issue with residents in the neighborhoods where they have developed. As a result, the City Council formally approved an ad hoc committee to address them during its July 23 meeting.
Thousands of sober living homes have popped up throughout the state, mostly in Southern California from Los Angeles to Orange and San Diego counties.
Serving on the committee will be council members Keith Blackburn and Barbara Hamilton.
“It would be to address the issue of sober living homes, to engage community stakeholders, listen to and discuss their concerns and recommendations regarding sober living homes and to recommend potential state and local regulatory and legislative strategies for the City Council to pursue,” said Jason Haber, assistant to the city manager.
3022 Segovia Way, Carlsbad 3br/2ba, 1,542sf one-story on a 13,033sf lot.
Sold for $835,000
Dreaming about the perfect backyard? Check out this extra-large and flat 13,033sf lot with plenty of privacy too! It backs to the park, and is easy walking distance to La Costa Heights Elementary School (rated a 10 at greatschools) in the Encinitas school district. This one-story house is light and bright with high ceilings (no cottage cheese) with new stove/oven and newer flooring, water heater, and furnace. Plus there’s no HOA or Mello-Roos either. City encourages a 640sf granny flat too – easy to add!
COMPS: Model match in identical condition with an illegal bedroom addition and BACKED TO RSF RD closed for $808,000 last August (3117 Quebrada Ct). Another in original condition with old pool closed for $850,000 in July, 2019 (7732 Anillo Way). A smaller single-story in mostly original condition closed for $851,000 in April, 2019 (7967 Represa Circle). And 3103 Cadencia just closed for $1,075,000.
If my listing was on a regular-sized lot, it would be easily valued at $800,000 today – how much premium for the double-sized lot??
Now that we’re reaching some equilibrium, let’s dissect the buyer pool. As recently as two years ago, 60% of buyers were probably interested in properties priced 10% over comps. Now it needs to be a real specialty product to garner attention if priced above retail – and having interest is different than actually paying over retail:
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!