Others including Bill Walton are thinking the Miramar open space would be ideal for housing – an excerpt:
San Diego has the nation’s best year-round weather and ample adjacent federal lands, making it the perfect site for the start of a national solution to homelessness. Sunbreak would soon prove successful in San Diego and could then be quickly replicated up the West Coast and across America.
We need help in three ways to launch the Sunbreak initiative:
1. We need our President and federal government to lease 2,000 acres of MCAS Miramar land to Sunbreak Ranch at $1 per year, and to designate this land as a temporary “federal emergency homeless help zone.” This will eliminate local red tape and opposition.
2. We need our President to deploy the military and security services to build a tent city for Sunbreak Ranch on this site with surplus equipment from the Afghan and Iraq deployments. Our military and security services have the manpower, expertise, and equipment to build out this entire tent city within weeks.
3. The cost of this Sunbreak experiment is minimal compared to the untold tens of billions of dollars currently being spent (to no avail) on homelessness annually.
To prove the viability of Sunbreak, we need significant individual philanthropists or organizations to step up and seed-fund this three-year Sunbreak initiative with up to $275 million.
This funding would include the proviso that when the first Sunbreak Ranch succeeds, the federal government will step in and begin fully funding a ranch outside of every major U.S. metropolitan center that agrees to return to the Rule of Law on their streets.
Homelessness is ultimately a public sector responsibility, but we first need the private sector and philanthropists to illuminate the pathway forward.
Won’t somebody just produce an all-encompassing (pardon the pun) website to facilitate homes sales? There is a new disruptor every month with their unique solution, and it’s ALWAYS born out of their frustration with buying a home recently so they are happy to bash agents and the current process.
But consumers have become more adept at searching online, and because there are so few quality homes for sale in 2023, their standards will probably relax further as their frustration mounts. Pretty soon, they will accept just about any risk, just to get their home search over with.
If a bigger company with some brand recognition put together the right website at the perfect moment when the consumers’ frustration is mounting and agents are flailing, it might catch fire. Something like this:
I’d prefer an auction company because it would be more effective at selling homes fairly, and for top dollar. But the winner will be the company that advertises the most.
I spoke to a few agents on the broker preview yesterday about business this year, and the common theme was that agents are have big trouble finding people who want to sell their home. It suggests that the inventory of quality homes will be extremely low this year.
What happens, when that happens?
It means that when listing agents get a hot new property to sell, they will be tempted to find their own buyer first, and/or spoon it to a select few of their agent friends, and then maybe expose it to their office mates before putting it on the MLS/open market.
The extinction of buyer-agents is well underway.
As the market tightens further, more listing agents will be tempted to sandbag their listing and not put it on the open market. Look what happened to the agent this week who received 20+ offers (they told me the final count was 30 offers). After the listing was put on the open market, the flood of offers caused regrets about the workload, so they just grabbed one and shut it down.
Last night I popped off in the comment section about how the business gets shadier every year.
Here’s proof – not every listing with zero days on market was sandbagged, but let’s face it. If you mark your listing pending within a few hours of it going live on the MLS, you didn’t get full exposure.
NSDCC Annual Closed Sales With Zero Days On Market
Year
Annual Detached-Home Sales, Total
# With Zero Days on Market
Percentage
2016
3,107
84
2.6%
2017
3,084
99
3.2%
2018
2,799
84
3.0%
2019
2,834
100
3.5%
2020
3,190
116
3.6%
2021
3,184
173
5.4%
2022
1,939
124
6.4%
When agents see other agents touting their off-market business, they think it must be ok, so they do it too. It feeds on itself, especially when the allure of double-ending the commission is so strong in a tight-inventory environment.
This disease among agents is everywhere. You will notice it at every open house you attend – the agents conducting the open house can’t wait to tell you about their off-market opportunities to get you to sign up. You’ll see it mentioned on social media daily – agents don’t think there is anything wrong with promoting off-market deals. Heck, everyone is doing it!
I regularly ask the agents who have a quality home for sale how they will handle multiple offers, and the answer is always the same: “I don’t know”, before they stumble and mumble something about the seller will decide (oh, thanks for that!) so the agents don’t get blamed for the end result. It’s embarrassing that they don’t have any strategy, and want to leave the door open for shenanigans later. No wonder they want to do an off-market deal, with no scrutiny.
Because no one is doing anything to intervene, the off-market deals will continue to be an accepted practice, and exacerbate the trend towards single agency (and the extinction of buyer-agents). Within the next year or two, every buyer will just go to the listing agent and take their beating.
I don’t think anyone in the realtor industry recognizes the harm being done to the consumers by squeezing out the buyer-agents. The good ones offer a valuable service by assisting homebuyers with the complexities of purchasing a home; a challenge that is tougher than ever in 2023.
For example, let’s say you come across a good buy – what do you do with this?
This weekend, the listing agent got 20+ offers and shut it down. Then he just accepted one. Game over.
None of the other buyers got a chance to win. But at least they had a chance to offer.
If buyers were directed to the listing agent, do you think the realtor teams would have 20+ buyer-agents ready to serve everyone who wants to make an offer? Or would they just write offers with the first couple of buyers and shut it down?
I can’t tell you how many times we see in the confidential remarks, “PLEASE NO MORE SHOWINGS”. We already have an environment where listing agents believe there is no incentive to keep taking offers – especially if/when they already wrote an offer with their own buyer and will double-end the commission.
It’s only going to get worse. Forces within the industry are conspiring to eliminate buyer-agents altogether, and are conspiring to create a system that makes it even harder for buyers to get a fair chance. The local MLS companies are launching a new search portal that directs all inquiries back to the listing agent.
Do you think an outside buyer-agent will have any chance of selling that listing now? If multiple buyers contact the listing agent, then what happens?
With the goal to “promote a more competitive marketplace,” three of the largest multiple listing services announced plans to launch a new consumer home search portal this spring.
Called Nestfully, the website will be owned and operated by California Regional MLS (CRMLS) and Bright MLS, under a joint venture, and REColorado has signed on as a participant. The founding MLSs designed the site and its features, and real estate tech company Constellation1 is providing technology services.
Key points:
Nestfully is expected to debut by April 1 with listings from a pool of 240,000 agents and brokerages that are MLS subscribers.
Agents will get leads at no cost, and consumers will have direct access to the property’s listing agent.
“With Nestfully, we believe we are in the best position to deliver what agents want and need in this changing market,” said Brian Donnellan, CEO and president of Bright MLS.
With the goal to “promote a more competitive marketplace,” three of the largest multiple listing services announced plans to launch a new consumer home search portal this spring.
Called Nestfully, the website will be owned and operated by California Regional MLS (CRMLS) and Bright MLS, under a joint venture, and REColorado has signed on as a participant. The founding MLSs designed the site and its features, and real estate tech company Constellation1 is providing technology services.
“Nestfully is run by MLSs whose primary goal is to promote an open, clear, and competitive marketplace,” Art Carter, CEO at CRMLS, told Real Estate News. “We are a neutral source working in the best interests of consumers, brokers and their agents.”
For agents, Nestfully offers a financial advantage over advertising-powered portals. The site will not have ads, and leads will be delivered directly to agents and their brokerages at no cost, “taking a significantly escalating cost out of the existing system,” Carter said.
Agents and brokerages companies will also have access to a lead management platform on Nestfully with lead tracking, analytics and metrics that gauge success.
“We believe we are in the best position to deliver what agents want and need in this changing market,” said Brian Donnellan, CEO and president of Bright MLS, adding that the new search engine will “serve as an extension of the agents’ marketing initiatives to promote listings, attract qualified lead prospects and forward these opportunities directly to the agent at no cost.”
The goal is not to monetize the consumer search, he said, but to help answer consumer questions about properties for sale and connect potential buyers with property listing agents or with a local agent or broker in their communities.
Asked in an interview if MLSs will be compensated for the initiative, a company spokesperson said that “financial arrangements are not being disclosed.”
Will they advertise enough to compete with the established search portals? They will need to promote some new whiz-bang feature…..which will be that buyers should go direct to the listing agent, and use their fancy new portal to do so.
I don’t think they have a clue – or they are flat out ignoring – how they will be putting buyers at a bigger disadvantage, and destroying our business as we’ve known it for the last 100 years.
I was going to ignore one more forecast by a financial services company (what do they know about selling homes?), but this is from the squid, plus Derek mentioned it in the comment section.
None of these forecasts provide any evidence or reasons for their conclusions. They are just guessing, apparently, and merely searching for more eyeballs.
They are probably transfixed on the median sales price, one of the worst tools available.
San Diego County Detached and Attached Homes, Median Sales Price
April: $871,000
December: $757,250
Diff: -13%
There you go – the county’s median sales price has dropped 13% so far.
Do you see that much in the market?
I’ll give you a better example:
NSDCC Detached-Homes, Median Sales Price
March: $2,625,000
December: $1,895,000
Diff: -28%
Do you see houses between La Jolla and Carlsbad selling for 28% less than they did in March? Me neither. NSDCC sales dropped in half (207 vs 101), and the homes that are selling are smaller (average square footage is -13%) and more inferior which explains why the median sales price should be dropping. But nobody mentions the additional variables.
We are being dumbed down by the squid, and others.
It’s impressive to see so many high-enders go into escrow this quickly – these are the NSDCC homes listed over $4,000,000 than have gone pending since the first of the year:
Not mentioned above is the listing that hit the MLS on January 3rd, went pending on the fifth, and closed on the 17th – and went back on the market the next day for $620,000 more:
It’s doubtful that any 1031 changes will get passed this year, but they are going to keep knocking. If you are a longtimer who would like to sell your primary residence but don’t want to pay the hefty tax, I recommend doing the double move as the best solution (move temporarily for two years – rent your primary residence then exchange it):
Potential changes to the 1031 exchange
The President’s 2023 budget currently includes some proposed tax changes to the 1031 exchange benefit. The proposed changes, if passed, could limit 1031 exchanges to an annual maximum deferral of $500,000 per person. This means that if you sold a rental property for a $800,000 taxable gain, a 1031 exchange may only help you defer up to $500,000 of that gain and the remaining $300,000 could be taxable in the current year.
To be fair, there is no indication that this section in the proposed budget will pass and become law anytime soon. But even outside of the potential law change, there are times when a 1031 exchange is not the most ideal solution when it comes to tax deferral. With the hot real estate market, it can sometimes be difficult to identify and close on properties within the timeline and monetary restrictions of a 1031 exchange. In addition, investors may be interested in keeping some of the cash from the sale and not roll all of it into another property. Or if you are no longer interested in being a landlord and prefer to be a passive investor, then a traditional 1031 exchange may not be as appealing to you either.
So, this brings up the question:
Are there alternative ways to offset taxable gain outside of using a 1031 exchange?
If you have a healthy gain built up in your real estate, here are some other strategies that can potentially help you to minimize the tax bite.
I’m just happy to see someone – anyone – step up to the microphone and discuss relevant facts about the real estate market. To also have my boss be so enthusiastic about the company and its future is an added bonus. Plus, our stock is up 50% (from $2 to $3!):
