There will be sellers wondering if they should pack it in and wait for next year.
Why? Because the frenzy might be slightly past its peak?
One of the primary guides on when to list your home for sale is to hit the open market when there aren’t any other homes for sale around you.
Is this one of those times? Homes for sale that are 3,000sf to 6,000sf:
The recent sales around your house have never been so high-priced. Mortgage rates are still 3%. Buyers hoping to move before school starts will be anxiously awaiting the new listings over the next few weeks.
It’s an alluring combo of benefits for sellers. Once the word gets out that the frenzy has cooled, it will be difficult to recreate these market forces next year! Let’s go!
Having 130 NSDCC homes in June sell for $100,000+ over list price should be an all-time record. If we had half that many, it would be astonishing!
But those were decisions made in April and May.
It feels like the market is in the deceleration stage, where fewer homes are worthy of a bidding war. Sellers and agents who insist on adding an extra 5% to 10% to their list price will need to be selling an exceptional property AND present it perfectly to generate offers.
The inferior homes/locations (the ones who really benefited during the peak frenzy) will be the ones that feel it the most. The gap between the dogs and the creampuffs will widen.
Listing agents who “have comps”, and around $5, can get a cup of coffee.
Open houses will help with the transparency. Buyers and lookers will be able to experience the upgrades in person, and get a better read on the traffic. The art of determining the difference between lookers and buyers will be renewed.
There will be eye-popping sales.
We will find peace with these higher prices. We would have gotten here eventually – it just happened faster than we ever thought possible.
Higher interest rates won’t have a big impact – there’s too much cash in play to soften the blow. One thing you can count on – sellers won’t care about higher rates. They aren’t in a hurry, they don’t have to sell, and they aren’t going to give it away!
If prices were to come down, it would be slowly and over time. There will be occasional deals that give hope to lower pricing, but then a couple of high sales will happen right behind them.
The ibuyers might be the only candidates who could influence the market in a panic, but they could rent their homes for a while if they had to. They are big corporate entities who are used to losing money, so no real pressure. The old accounting rules REQUIRED banks to sell their properties quickly, but those days are long gone.
More potential sellers will give up the thought of moving, and the number of homes for sale could stay restricted – or even go lower. The hope of there being a post-covid surge of sellers will wane.
If there were an occasional surge of new listings, they would all be priced based on recent sales…..or priced higher. If buyers don’t like today’s prices, having more inventory priced the same won’t help.
The statistics will bounce around more as we pull into Plateau City.
All of the above (except #1) should remind you of how it used to be!
As long as there are more pendings than actives, the market is doing just fine.
Oh well – that was last week’s thought.
As you can imagine, it’s the high-end market that is loaded with actives. This week an agent commented on what a delightful experience he had showing higher-end homes in Rancho Santa Fe, where listing agents were happy to book appointments at the buyers’ convenience, didn’t go crazy about having to submit financials just to see a home, and were paying regular commissions. A few of the homes had been sitting around for months!
My guess is that most of the disappointed sellers will pack it up and wait until next year, rather than consider selling for today’s top dollar – which might be slightly less than they thought (but 10% to 30% more than it was 2-3 years ago).
How’s the action in the more reasonably-priced categories?
There are 100 active listings, and 191 pendings priced under $2,000,000 today.
A home’s outward appearance plays a big role in whether potential buyers want to tour the interior. Here are ways to give the home’s curb appeal an instant makeover:
1. Update the light fixtures
Updated light fixtures can change the way the front of a house looks but has an added benefit of making it safer when you use brighter bulbs too. Most outdoor lighting fixtures are much smaller than they should be. (That may had been intentional on the builder’s side; smaller fixtures are less expensive.)
Tip for choosing the right fixture: When you’re choosing a new light fixture, take cues from the home’s architecture, color, and your location. For the size, choose a fixture that’s one-third of the height of the door if you have only one light and one-quarter the height if you have a light on both sides of the door.
2. Upgrade windows and doors
Updating your windows and doors are a great way to improve the overall look of your home while also being energy-efficient. Consider adding window boxes, shutters, or even painting the trim for an added pop of color.
When upgrading the front door, choose a new door that matches the home’s style. Or you could follow the latest front door trends for 2021–glass elements, custom hardware, wood stains, or darker paint colors.
3. Paint
Painting your house is a huge task, but it can pack a huge punch! Just imagine the statement you’d make by ditching the boring beige, dulled white, or dated yellows. If you want to modernize your house, consider painting the house black or navy blue. Or, if you want to achieve that comfy-cottage look, try a light shade of gray or even a very pale shade of pink.
4. Add wood and/or stone elements
Adding wood or stone elements to the exterior can help give a home a “wow” factor. Even if you don’t want to put stone veneers on the exterior, you could add stone and wood elements in other ways, like by using stone to line the walkway, a wooden fence, or even stone or wooden lawn ornaments.
5. Hire a professional landscaper
There’s a huge difference between do-it-yourself landscaping and landscaping that’s completed by a professional. A professional landscaper can make your lawn a luscious green carpet that’ll make you want to kick off your shoes. They’ll know which native plants to choose to make a yard warm and inviting. They can also create water features, intricate flower beds, build retaining walls, and more.
6. Refinish walkways and the driveway
The walkways and driveway get a lot of use, and all that wear and tear will need an update over time. A professional landscaper or hardscaper also can upgrade your driveway and walkway by using stone, brick, or cement. But if you’re on a budget, a good power-washing may also give a curb appeal boost.
As we roll into the post-frenzy era, we’ll see more national news about the changes – but all we know for sure is that it’s less hot than it was. Note the gray line above.
Fannie Mae said “Consumers are increasingly adamant that it’s a good time to sell, bad time to buy a home” as it released its June Home Purchase Sentiment Index (HPSI). The index, based on the company’s monthly National Housing Survey, shows a growing difference in the number of consumers who hold one or another of those opinions.
The HPSI was largely unchanged in June, dipping from 80.0 in May to 79.7, but questions of whether it is a good time to buy a home or to sell one produced notable results. Only 32 percent of survey respondents said it was a good time to buy, down from 35 percent in May and with an 8 point increase in those who thought it was not.
As a result, the net who were upbeat about buying fell 11 points to -32 percent, 66 points lower than in June 2020. Conversely, the net who said it was a good time to sell rose 20 points in June to 62 percent and was 69 points higher than at the same time last year.
“The HPSI remained flat this month, although its underlying buy and sell components continued to diverge, setting record positive and negative readings, respectively,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “Consumers also continued to cite high home prices as the predominant reason for their ongoing and significant divergence in sentiment toward homebuying and home-selling conditions. While all surveyed segments have expressed greater negativity toward homebuying over the last few months, renters who say they are planning to buy a home in the next few years have demonstrated an even steeper decline in homebuying sentiment than homeowners. It’s likely that affordability concerns are more greatly affecting those who aspire to be first-time homeowners than other consumer segments who have already established homeownership.”
The percentage of respondents who say home prices will go up in the next 12 months gained one point to 48 percent while the percentage who expect a decline went from 17 percent to 21 percent. There was a 4 point increase in those who expect no change. The net who expected an increase was 27 percent, down 3 points for the month but 18 points higher than last June.
More than half of respondents expect mortgage rates to go up, resulting in a net of -52 percent who expect further declines. This is 8 points lower than May.
Job confidence increased slightly. The number of respondents who said they were concerned about losing their jobs dipped 1 point to 11 percent with a corresponding increase in the share who said they were not. The net who were not concerned rose 2 points to 77 percent.
Duncan continued: “Despite the pessimism in homebuying conditions, we expect demand for housing to persist at an elevated level through the rest of the year. Mortgage rates remain not too far from their historical lows, and consumers are expressing even greater confidence about their household income and job situation compared to this time last year, when the pandemic had shut down wide swaths of the economy.”
The HPSI is up 3.2 percent compared to June 2020.
The National Housing Survey from which the HPSI is constructed, is conducted monthly by telephone among 1,000 consumers, both homeowners and renters. In addition to the six questions that are the framework of the index, respondents are asked questions about the economy, personal finances, attitudes about getting a mortgage, and questions to track attitudinal shifts.
This just closed for $7,200,000 cash, which was $5,000 above its list price. It had been on the market for almost two years with two different agents and had a couple of refreshings:
Donna’s tribute to Kayla (from our newsletter) will be the perfect way to kick off more contributions:
Tomorrow (July 9th) is a very special day. 30 years ago I became a Mom and I remember like it was yesterday. Filled with uncertainty – can I do this? Emotional – lots of hormones! But filled with lots of love and wonder as I took a look at our little girl Kayla Marie.
I remember fondly 3 year old Kayla who loved “Mommy and Me” Saturdays which were basically errands but to her it was an important outing just the two of us. Kayla has a way of making everything special. We always ended up sitting in the car feeding McDonalds French Fries to the seagulls in Carlsbad – the car would be filled with squeals because those seagulls can get aggressive. With Kayla you can always count on laughing until your stomach hurts.
Kayla found her voice through dance – she used to be very shy as a toddler. But anyone who knows her now knows Kayla can talk to anyone about anything – she makes friends easily. When she decided three years ago to move to New York City because she has always wanted to live there ever since Gossip Girl, I was so impressed by her courage to just go for it. I will never forget her saying to me “Mom we just got to walk on in like we own the place” when we were figuring out what to do at this event. I watched her walk into this room and own it – it was a memory.
But what I love the most about Kayla is her huge heart. Her 2nd Grade teacher Angie told me about how big her heart was and she was right. You just feel it. 30 years and she has never stopped living her life that way. She would do almost anything for anyone she cares about. She will give you everything she has. She is a loyal and fierce friend. She remembers everyone’s birthday – just ask her and she can tell you without looking it up on her phone. When you are with her and she’s focused (sometimes she isn’t), you feel special and just fortunate you are in her world. Of course she is not perfect; she drives me crazy at times and there are days I just need a break. It can be exhausting! But then she wouldn’t be Kayla with all her glory, fun and charm.
Happy Birthday sweet girl – I am so glad you chose me to be your mom! I love you lots and I am so proud of the woman you have become. Here’s to you – 30 and Fabulous! Enjoy your special day.
The stories started early last night, and the favorite was her memory of us going to Disneyland when she was a kid, and waiting in line for autographs from a boy band who was playing that week.
Before we got to the front of the line, they shut down the signings – and Kayla was crushed.
That night, she talked me into taking her back, just so she could get her autographs. Over Mom’s objections, we returned the next day and she got what she wanted!
She is equally determined to stay in Manhattan for the duration, and make it as a realtor. She had two sales set up for closing next week, which would have been a new record for her.
But one of the sales just got delayed because the seller didn’t feel like moving until middle of August. Because the sale was in a co-op building where the owners have to approve of the new buyer, the purchase contract (authored by attorneys) doesn’t specify a closing date due to the uncertainty of the approval process.
It’s part of Kayla’s job as buyer’s agent to submit a ‘board package’ so they can review the buyers and their financials, which she did well in advance and got it approved. But without a closing date set in advance like we do it in California, her buyers will have to wait another month before moving in, which was fine – but different!
Happy Birthday Kayla – it is my life’s joy to be your Daddy! I love you!
