Are you thinking of going somewhere that doesn’t have bidding wars? You need to go a ways!
Just in case you haven’t heard, snagging a well-priced home in today’s real estate market can feel a bit like winning Powerball. It’s all about beating sky-high odds. Scant inventory, worsened by a pandemic-crush to buy new homes, has led to prices reaching new records and competition bidding them up even higher. All-cash bids and multiple offers way above asking are pricing many would-be homeowners right out of the market, or leaving them feeling hopeless.
“Demand has actually been growing stronger than supply going all the way back to 2014,” says Doug Duncan, chief economist at Fannie Mae. “It’s just that in 2020, incredibly low interest rates augmented that demand.”
In other words, we’ve found ourselves in an extreme seller’s market.
But not everywhere. The Realtor.com® data team found the places where buyers could actually have the advantage. Buyers in these spots—which tend to be smaller cities and college towns—have more properties available to choose from, and prices haven’t risen too much (if at all) compared with where they were at the start of the COVID-19 pandemic. This doesn’t mean home prices haven’t risen and the competition isn’t fierce in these cities—they’re just better than the rest of the country.
Looking ahead, buyers may get some more relief in the coming months as sellers become more comfortable listing their homes. Rising mortgage rates and the increase in inventory could slow down price gains. And while prices likely won’t drop, or at least by much, it could lead to a bit less competition.
But where can buyers get at least a little relief right now? To come up with our list of places, we looked at cities where home prices had not risen more than 10% in the past year (compared with 16% nationally) and calculated the number of homes for sale per 1,000 households—the more the better. All of the cities had at least 50,000 residents, and we limited the list to one city per state to achieve geographic diversity.
It’s getting to the point where it is so competitive that buyers will be tempted to make offers without contingencies to improve their chances of winning. But let’s face it, they would do so reluctantly.
Sellers should be very cautious about taking an offer with no contingencies.
You will be making a deal that would have maximum buyer’s remorse. If the buyers change their mind, and they insist on fighting for the deposit, it will tie up the property so you can’t sell it to anyone else.
Are you going to chase them around for 6-12 months to try to get their deposit and risk missing the peak – and screw up your plans for moving too?
Part of the challenge of the low-inventory era is to find the hidden gems. Travel into south Vista just two miles from Carlsbad and look how much further your money goes!
Here’s our new listing that overlooks the private Shadowridge Golf Club for only $699,000!
1990 Spyglass Circle, Vista
3 br/2.5 ba, 1,835sf
HOA fee: $165/mo
The former model home ideally located above the 8th green has been beautifully remodeled and is better than new! Hardwood floors, new carpet and paint, newer kitchen and tuned-up baths! Located in a highly-desirable community with low HOA and no Mello-Roos, plus community pool & spa. Check it out!
Our seasonally-adjusted Case-Shiller Index rose more in one month than any other U.S. metro area!
The increase in the three-month annual percentage was nearly 22%, and it doesn’t include March and April which have been hotter.
The San Diego index was still positive during the initial Covid months (but muted), so it’s safe to say that the year-over-year percentage increase for the next few readings will be substantially higher than February’s.
Could San Diego end up with 30% appreciation in 2021?
Zillow is optimistic that we will see more homes being listed for sale:
In prior years, inventory has generally increased in March, and the return to some seasonal normality is a positive sign that the market is reaching a more steady state and could see inventory rise more steadily going forward. With home values skyrocketing, vaccination rates rising, and employees getting long-term guidance on where they can work, we expect an increasing number of homeowners to enter the market and list in coming months. That will come as welcome news to home shoppers enmeshed in bidding wars and watching homes get plucked off the market weeks faster than usual.
But their graph shows an interesting trend. Our inventory had already been dropping since the middle of 2019, and is probably why the beginning of 2020 felt hotter than usual:
If we are nearing two years’ worth of declining inventory, than it wasn’t just a Covid-related event – which means the low-inventory environment will persist after Covid is gone.
If baby-boomers control our destiny and continue to age in place, then it may last for years to come.
But does it impact sales?
Here’s how this month’s numbers compare to the full month of April, 2019:
NSDCC Listings and Sales in April
Number of Listings
Number of Detached-Home Sales
We have already exceeded the number of sales for all of April, 2019 with a few days left to go!
These are the optimal frenzy ingredients of all-time!
If we do see more homes coming on the market, they should all get gobbled up and cause even crazier market conditions as buyers could have a new listing to consider every week, instead of every month. It might even put a dent in the pricing trend that has been going straight up:
San Diego had positive gains straight through the Covid-19 era:
San Diego Non-Seasonally-Adjusted CSI changes
The index should continue to rise more than 2% month-over-month over the next few readings.
Wifey did this for me because I left this morning before the new number was released. We’re heading for more than 20% appreciation this year! San Diego jumped into the #2 slot for the whole country too! From cnbc:
The cities with the largest gains continue to be Phoenix, San Diego and Seattle. Prices in Phoenix gained 17.4% year over year, followed by San Diego with a 17% increase and Seattle with a 15.4% increase. Nineteen of the 20 cities reported stronger price gains in the year ended February 2021 versus the year ended January.
Even as vaccines are distributed more widely and Americans start to emerge back into the economy, the desire for larger living spaces with more outdoor amenities appears not to be waning.
“This demand may represent buyers who accelerated purchases that would have happened anyway over the next several years,” said Lazzara. “Alternatively, there may have been a secular change in preferences, leading to a permanent shift in the demand curve for housing. Future data will be required to analyze this question.”
Two weeks ago we hit a slight dip attributed to the spring break, and the pendings have roared back:
Three Weeks Ago:
Two Weeks Ago:
One Week Ago:
While the +20 pendings over actives is impressive, the 362 is far from an all-time high. The total number of pendings was in the 400s between June 22nd and Nov 30th, with the high being 491 on September 7th.
These average $$/sf are touching new highs though, and the sellers will keep pushing:
NSDCC Detached-Home Active Listings
# NSDCC Active Listings
# Sold Last 60 Days
$1.0M – $1.5M
$1.5 – $2.0M
$2.0M – $3.0M
If you can buy a house between La Jolla and Carlsbad for less than $600/sf today, you’re doing pretty good!
This has a Del Mar address but Sun Valley is east of the 5 and feels more like Rancho Santa Fe, its neighbor down the street here. This sold for $2,675,000 last June, which seems like a relative bargain today:
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!