Michele and I cruise around twice a week looking at the new listings.
I love it because I get to pontificate about the business and give her guidance like a good broker should.
She asks many great questions, and today was no exception. She had read the blog post from 2009 where I said agents should know the hot buys. She asked about the definition of a hot buy.
Today there is an easy formula to identify a hot buy:
If the number of Zillow Saves is 5% or more of the Zillow Views, it is a hot buy.
If the Zillow Saves are 7% to 10% of the Zillow Views, grab your checkbook – because it is sizzling hot.
Of course, now that I’ve divulged my tip, a few agents will manipulate the counts so if the listing agent is a known scumbag, then don’t trust their counts. You know who the scumbags are, don’t you?
We came up with another idea too.
If the house is one-story, newer, and the price is attractive, it’s a hot buy. But then we went one better.
If the house has two of the three (one-story, newer, attractive price), it’s probably a hot buy anyway.
If the list price is attractive, that is enough to power any sale, but if the price is attractive and the house is either one-story or newer it will probably be a hot buy. In 2024, a newer one-story house doesn’t even need to have an attractive price – there are so few of them that they can ask anything they want.
We saw three houses for sale today that will demonstrate my theorem. All are one-story homes that have been improved and should appeal to the maximum number of buyers – especially the seniors who have the money and will only consider a renovated one-story in a good location with some view:
For those who desire a full ocean view from both the family room AND the primary suite and can live with 1,620sf built in 1986 on a smaller lot in Carmel Valley, you can’t do much better than this for $2M:
If you want a fully-renovated one-story house just east of the freeway in Solana Beach that overlooks the golf course, then this would be worth a look:
Want to step it up and buy a brand-new 4,194sf one-story house with ADU in a prime Del Mar location with ocean view – and price is no object? Then this is for you, priced at $16,995,000:
Why would these three list for sale now instead of waiting until next year? Well, I can’t help you with that. It is the most lucrative time ever for buyers to pause during the absolute peak wait-and-see period of all-time.
So if 1-2 of these go pending by the end of the year, it will show that the premium properties are always hot – and I wouldn’t be surprised if they all sell.
We flew back from visiting family in the Bay Area yesterday and got some photos along the way:
Torrey Pines GC
As we roll into the Lowball Season, we’re reminded of what happened in Carmel Valley at the end of 2022. Everyone’s home equity was built up fast and easy over the last 3.5 years, and the more desperate sellers might give it back in big chunks if they had to….and with 8% mortgage rates, they might have to.
How did it turn out last year?
The fourth quarter of 2022 was brutal for the entry-level homes in Pacific Highlands Ranch:
The list pricing was fairly optimistic, and after 30+ days on the market, the lowballers came out. By the time my listing hit the market (the last on the list), our list price was revised down to $1,599,000 to ensure we would sell right away – and hopefully for more, which we did, and stop the trend.
Did the pricing bounce back this year?
The first sale of 2023 closed right away for $1,690,000, and it seemed like the comeback was underway. But then the next sale was $1,560,000 – and it has hampered the pricing ever since:
The big threat isn’t going to be foreclosures. It will be the equity-rich sellers who dump on price to get out – and they will impact future sales. A couple of lowballs can turn into a trend!
Letters like these probably won’t help either:
I don’t know why they aren’t building homes any faster across the street – do you?
The 1+ acre lot was probably what sold this one.
Part of a nice flurry of July sales that are inline with the monthly sales counts in March-June. But the median sales price has a month-over-month change of -17%, which will cause the doomers to flip out. But it’s only because there were a bunch of lower-end sales this month.
Your home’s value didn’t drop 17% in the last 30 days!
I don’t know if they did it on purpose, but this was priced well below market at $1,295,000. On Friday it closed for $1,570,000. The open house started at noon – I got there at 2pm and it was still cranking.
This was the lowest-priced single-family-residence in Carmel Valley this year – by $200,000! It shows you that when you put a home on the open market and let everyone have an opportunity to buy it, the market will get you up close to retail. Two other listings of this model are pending, priced at $1.5 million. One of them was pending when this went on the market.
The local home pricing is still off the highs of early-2022, but not by much.
The smaller sample sizes (fewer sales) will make it harder to accurately identify the trends and cause more frustration/indecision for both buyers and sellers. Have we recovered, or just briefly paused the softness?
Most of all, it will expose the skill sets of realtors.
Get Good Help!
Survey results from our friends at 1000Watt:
For the buyers who want to live in a master-planned community with good schools, how bleak is it?
No one will be surprised to see the newer tracts hunkered down for another decade or longer, so let’s look at the older communities – those that are 20-25 years old. Those original owners are bouncing around in their empty nest, and should be cashing in and downsizing by now, shouldn’t they?
For homeowners who are planning their move carefully, April should be seen as the ideal month to list a home for sale. Yet look at the results:
The Carmel Valley tracts used were Belmont, The Breakers, and Lexington.
I know there are still a few days on April left this year, but it doesn’t look good for buyers so far!
I’m still doing the frenzy format. Sell the first weekend with multiple offers!
Plus, thoughts on a market floor (tight group of recent comps with a upward trend in pricing).