The last paragraph (above) might be the worst misread in the history of forecasting. I’m not sure why they are sticking with it.
Mortgage servicers have stated that they will modify the delinquent mortgages and extend them for another 40 years if necessary – making it a great time to be a deadbeat.
Wouldn’t any of their “plummeting sales volume”, be supportive for pricing?
If we had fewer sellers than we have today, then prices would go up. Demand would have to evaporate for both sales volume and prices to go down.
As for their revisionist history about the 2008 recession, real estate market performed better in the higher-end areas during the last crisis. We’ve had a 10-year trend of buyers purchasing their forever home since then, which will deter any wholesale dumping of properties.
So who is going to dump now? Seniors? Their heirs? Nothing suggests that today.
Mitt Romney has sold his oceanfront La Jolla home for $23.5 million. The Utah senator, and former Republican presidential candidate, completed the sale June 30, according to the San Diego County Recorder’s Office.
A small part of American history, the home became an example of what opponents in the 2012 presidential election said was an example of Romney being out of touch as he attempted to build an elevator on the property for his cars. The “car elevator” house was often tied to Romney’s opposition to the bailout of the auto industry during the Great Recession. “The cars get the elevator, the workers get the shaft,” said former Michigan Gov. Jennifer Granholm in one of the most often-quoted speeches from that time.
The sale price makes it the fifth-most expensive home sale in San Diego County history, and the third-most expensive for La Jolla. The biggest purchase in San Diego County history remains the 2007 sale of an oceanfront home in Del Mar for $48.2 million. The same house was later sold to Bill and Melinda Gates for $43 million in April 2020.
The grant deed said the Romney home was sold to William Rastetter, and his wife, Marisa. Rastetter has been a force in San Diego’s biotechnology and venture capital scene for more than three decades. He’s perhaps best known for his 20 years at IDEC Pharmaceuticals, where he served in leadership roles including chief executive, president and director. While there, he was the co-inventor of Rituxan, the first monoclonal antibody cancer treatment approved by the U.S. Food and Drug Administration. IDEC merged with life sciences giant Biogen in 2003 for $6.8 billion.
Rastetter also served as board chairman of gene sequencing giant Illumina for 11 years, and has been a director at myriad other local life sciences firms. They include Neurocrine Biosciences, Regulus Therapeutics, Fate Therapeutics and Receptos, which was acquired by Celgene Corp. in 2015 for $7.2 billion.
Romney and his wife, Ann, purchased the property at 311 Dunemere Drive in 2008 for $12 million. The existing 3,009-square-foot home was torn down to build an 8,153-square-foot mansion with five bedrooms, six bathrooms and 65 feet of ocean frontage. It is one of roughly 30 beachfront homes in La Jolla.
The home was sold off-market, making a photo of the notorious “car elevator” hard to find. A 2020 assessment of the property, valued at $15.3 million, said the four-car garage was completed.
Room for parking in San Diego beach communities is rare. The most expensive La Jolla home sale, $24.7 million at 8466 El Paseo Grande in January, has a two-car garage. Romney’s campaign in 2012 said the lift was necessary to create a four-car garage because he has many children and grandchildren.
Romney revealed he had sold the home in late June in a virtual discussion about infrastructure sponsored by the Salt Lake Chamber, and was first revealed by The Salt Lake Tribune . At the time, his staff declined to discuss the details, including the price.
The San Diego Union-Tribune reported in 2015 that Romney had been considering selling the home near the end of its rebuild. The project was opposed by several neighbors and conservationists for what they said was an out-of-place design in La Jolla.
Romney was not the only well-known person to live at the property. The original home was owned by former San Diego Mayor Maureen O’Connor and her late husband, Bob Peterson, founder of Jack in the Box restaurants.
Mitt Romney recently paid $12 million to buy a home on the ocean in La Jolla, Calif., near San Diego. His son Matt lives in the same area. The former Massachusetts governor, whose main residence is in Belmont, Mass., says he has no plans to become a California resident, and the purchase has nothing to do with a possible future presidential run.
“I’ve always wanted to have a place on the beach where you could hear the crashing waves,” Romney says. “And you know, I’m 61; I’m not going to live forever. I said, ‘Ann, I want to get a place on the beach. I don’t care what size it is, but I want a place on the beach.’ And this spot, it’s not a huge home, it’s 3,000 square feet, but it is right on the beach, and you open the windows and hear the waves crash. It’s heavenly.”
Of the 1,682 NSDCC houses sold this year, the median list price was $1,800,000, the median sales price was $1,850,050, and the median days on market was 12.
An excerpt from the UT article linked below – the lack of homes for sale is stunning:
If you look at the overall number of homes for sale in San Diego County, it is still at historic lows. There were 3,990 homes for sale from May 24 to June 20. That is below even 2020 with stay-at-home orders in place when there were around 6,260 at the same time. The same goes for 2019 with 8,561 homes listed; 2018 with 8,064 and 7,185 in 2017.
So, while there have been more new listings in recent weeks, they have been selling so fast that inventory totals don’t have the chance to grow. For instance, around this time last year, about half of homes were selling in two weeks or less (compared with more than 70 percent now). That meant a home that went on the market in May might still be there in June or July — whereas now there is no buildup in supply because new listings are snatched up so rapidly.
The Covid Frenzy has had remarkable shift in market efficiency like we have never seen.
Historically, we have had so many listings that 35% to 40% of them didn’t sell.
This year we had 977 listings hit the market in 1Q21, and 80% of them have already closed escrow! Of the remaining listings that haven’t sold, two-thirds of them were cancelled, withdrawn, or expired which usually means that the sellers either changed their mind or refreshed their listings. Of the 977 listings, only 47 of them remain as active (unsold) listings, with a median list price of $6,900,000!
Yet, the extremely active marketplace isn’t causing more people to sell.
The total number of 2021 listings is 8% behind the covid-impacted 2020!
NSDCC Listings and Sales
Month
2018
2019
2020
2021
2021 L/S
Jan
426/149
418/150
353/182
285/187
1.52
Feb
358/162
361/174
360/184
311/224
1.39
Mar
446/258
498/211
368/206
381/252
1.51
Apr
469/270
494/265
288/156
382/357
1.07
May
522/273
502/297
484/143
404/301
1.34
Jun
476/299
435/282
448/274
357/340
1.05
1H Totals
2,697/1,411
2,708/1,379
2,301/1,145
2,120/1,661
List/Sales
1.91
1.96
2.01
1.28
There were 357 new listings last month, and 340 sales?!?! The lack of inventory or the rapidly-rising prices aren’t slowing down sales! If only there were more houses to sell under $2,000,000!
If sales were to retreat, it would seem obvious that it would be due to the lack of supply. There have been more losers of bidding wars than winners, and that demand has yet to be satisfied.
But we are going to hear more doomer talk in the media. Here we have Larry predicting that more homes will be listed in the latter half of 2021 – which would cause MORE sales – yet check the headline:
An excerpt:
What happened: All regions saw an uptick in pending sales, led by a 15.5% surge in the Northeast. The South saw the smallest increase, with a 4.9% uptick.
The big picture: The uptick in pending sales could be sustained, Yun argued, because of the strong stock market and rising home prices. He predicted that more homes will be listed in the latter half of the year, which would help to slow the pace of home-price growth.
Still, economists generally anticipate that the second half of 2021 will see a slowdown in real-estate transactions. To get an idea of where home sales are headed, look no further than the data for mortgage applications.
“Sales lag mortgage applications, and the 26% plunge in the latter between December and April is now working its way through the sales numbers,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a research note. He went on to argue that “sales will soon hit bottom, given the flattening in mortgage demand over the past couple months.”
The latest mortgage-applications data from the Mortgage Bankers Association would back up that prediction. The trade group’s index that measures the volume of applications for loans used to purchase homes was down 17% from a year ago as of the week ending June 25, and had declined 6% from the previous week.
Hit bottom? Bottom of what?
The ‘26% plunge’ in mortgage applications between December and April didn’t slow sales – they are higher in every market. But determined to find some doom, he surmises that the lower number of purchase applications will catch up to sales some day?
It doesn’t occur to the ivory-tower types that the market was going ballistic last summer, and this week’s mortgage apps being 17% lower than last year is not alarming. We had 350 NSDCC sales last August, and another 361 sales in September – both record highs!
Yet the media publishes this garbage without a thought. They could unwittingly cause a slowdown just when more homes might be coming to market – which would goose sales higher, not lower.
