Virtually everyone is reluctant to predict the future of the real estate market. Even most realtors will throw their hands up and declare, “Who knows?”.
But around here, one fact has been clear and it tells us what we need to know about the rest of the year. The number of NSDCC listings in January ends up being 8% to 9% of the total for the year:
NSDCC Listings and Sales Data (La Jolla, Del Mar, Solana Beach, RSF, Cardiff, Encinitas, and Carlsbad)
It means that by mid-February we will be able to predict how many listings there will be in 2025, and thus, give us the likely direction of the market for the rest of the year.
I’ve been saying for three months that there is going to be a surge of listings, and it could be 15% to 20% more than there were in 2024. We’ve been doing the contest for Padres tickets to help put a spotlight on the January listings, and it has never been more interesting to see how many will hit the market this year!
Tomorrow, I’ll do a summary of the guesses so far and give everyone the rest of the week to enter or revise their guess so come back Monday morning.
The chart above gives more data for the analytical folks to craft their guess.
My Thoughts:
The last frenzy before Covid was in 2013. Pricing was stuck in a fairly tight range for the previous five years, but listings dropped and sales took off in 2012 and pricing followed in 2013 with a little more inventory. The variables weren’t all the same as today, but you may want to apply a similar effect from the animal spirits to today’s market. Or maybe not?
With another 9% increase in the median sales price and cost-per-sf in 2024, it shows that there really hasn’t been any limits on pricing. Will 2025 be the year that it changes? If so, will it be caused by another surge in listings? Or is there enough money floating around that more listings will cause more sales at higher prices like it did in 2024? It could go either way.
What about the political climate? Pro-Trump supporters are elated and will gladly join the buyer pool. Anti-Trump people are fearing the worst, but like we saw during the pandemic, fear is a fantastic motivator and it causes people to want to hunker down…at any price.
I had more people attend my open house yesterday on La Costa Avenue than I’ve had at the previous seven OHs. Most were just getting started, and the basic need for housing will keep them looking around. Will they buy? We’ll see.
We round-tripped four of our 17 listings in 2024 – and three of those were since the commission debacle on August 17th. Successfully working with buyers had already been a major challenge for agents, and now it’s worse. The affluent buyers will probably always want professional help, but will there be many, if any agents left who are willing to devote months of effort just to have their commission rate dangled in front of the seller for their approval?
Will the market survive it all? Yes, because there isn’t anything that price won’t fix!
