Let’s break down down the active and pending listings by zip code to give the readers a closer look at their neighborhood stats. There will be some noise due to me changing to the CRMLS system, which is different than at the SDAR even though we are supposed to be data-sharing:
Remarkably, the pendings count is the highest since last May – the peak of the frenzy!
The Carlsbad market has been surviving quite well – there are 14% more pendings today than last July.
The other areas are all above the 2:1 ratio of actives-to-pendings (our standard for a healthy market). The number of actives in Encinitas DOUBLED in less than a month!
Last July there were 171 pendings, and it’s the same number today!
The pendings should steadily decline like last year, and by December the count should be around 110.
The number of active (unsold) listings has been on the rise, and is now 13% higher than it was a month ago – though I would still characterize the current market conditions as steady.
Compare your stats from this month to last June and July when higher rates had begun to take their toll. The rate-change was rather abrupt, and it was natural for buyers to wait-and-see about the impact which caused the active inventory to soar.
If your area looks similar to last June/July, it’s probably not a good thing.
The activity this year is more normal and typically what happens as the selling season closes out – sellers are too enthusiastic after a couple of hot months and don’t adjust their price expectations fast enough.
There have been 57 closings between La Jolla and Carlsbad this month, which is good. The monthly sales total should finish over 100, but it probably won’t get up to the 168 sales we had in May.
There will be a few more eye-popping sales, but generally the 2023 market is fading away.
Here’s another example of how the frenzy has taken a different path in each area.
Carlsbad, Encinitas, La Jolla and Rancho Santa Fe are rolling along with about the same or more pendings than last month – which should have been the peak – but the wheels have come off the wagon in Carmel Valley. There hasn’t been single-digit pendings in the 92130 since we started checking this two years ago! But there are homes for sale, which must mean the prices need some adjustment.
In 2020, there were 400+ pendings from June 22nd to Nov. 30th – with a peak of 491 pendings on Sept. 7.
We are in the middle of the home-selling season, which means this will be as good as it gets for 2023.
The balance of buyers and sellers has been remarkably steady. Over the last 90 days, the number of active listings has been in a tight 10% range, and the pendings haven’t budged, really, since the Super Bowl.
Those who planned ahead about selling during the season should have listed their home by now. There could be some daredevils who are waiting another 2-3 weeks before going live, thinking that a few more comps might close and help them achieve an extra 5% or so – but it could go either way.
The reason for breaking down the active and pending listings by zip code is to give the readers a closer look at their neighborhood stats.
Four areas have MORE pendings than active listings, which is a sign of a red-hot market, and all areas except Rancho Santa Fe are around the healthy 2:1 ratio. But the most interesting datapoint is how the number of active listings has been skidding downward ever since rates went up:
The demand may have dropped off, but the supply is shrinking just as fast, or faster. Virtually everyone who is thinking about selling their house this year is going to be on the market in the next 2-3 months, and so far, it doesn’t look like the number of springtime sellers will be anywhere close to what we’ve had in the past.
The number of 2023 NSDCC listings is already 20% behind last year’s count – which was the lowest ever.
The reason for breaking down the active and pending listings by zip code is to give the readers a closer look at their neighborhood stats.
Most areas look healthy (ratio of 2:1 or better), and those in red have very similar to numbers to last spring which was probably the hottest frenzy on record:
The number of pendings has risen 33% in the last month, and the active listings are restrained. There aren’t any signs of panic and there have been some eye-popping sales already this year that makes you think the frenzy conditions are still around.
We are set up for a boisterous selling season, in spite of high prices, high rates, and high skepticism!
The reason for breaking down the active and pending listings by zip code is to give the readers a closer look at their neighborhood stats. We have considered a 2:1 ratio of actives-to-pendings to be a healthy market. When there were more pendings than actives, the frenzy was out of control, and when the number of actives reaches a 3:1 ratio of higher, you know that the market is going the other way.
Lately, the ratio has benefitted from cancellations, and today’s A/P ratio is close to the June level:
The number of choices today is anemic, and not that much different than the frenzy levels. The combined totals of actives and pendings (underlined in purple above):
Feb: 384
Mar: 386
Jan: 386
Fewer are selling now because of listing exhaustion.
Of the 105 new listings in January:
Number of those on the market in 4Q22, and refreshed as a new listing this month: 44
Number of January listings that were purchased in 2020: 13
Number of January listings that were purchased in 2021 or later: 19
You can say that the inventory of exciting new offerings is extremely tight, especially for those buyers who have been looking since 2020 – you’ve previously seen 72% of the ‘new’ listings.
In 2020, we had 400+ pendings from June 22nd to November 30th – with a peak of 491 pendings on September 7th.
The reason for breaking down the active and pending listings by zip code is to give the readers a closer look at their neighborhood stats. Typically, we’ve considered any market to be healthy that has a 2:1 ratio between active and pending listings.
SW Carlsbad, Carmel Valley, and Encinitas all have a ratio that is better than 2:1 – and we are half way into December! Six areas (in green) have more pendings today than they did before Thanksgiving!
I’m declaring victory for 2022.
We survived the fastest rise in mortgage rates in history, and not only are sales still happening (38 closed in December so far, so we should get close to 100), but the new-pendings count has been hanging tough too.
Observations:
Maybe we can get a quicker start in 2023? If buyers are on vacation and come back next month to see some price reductions, we could have a decent January too.
The reason for breaking down the active and pending listings by zip code is to give the readers a closer look at their neighborhood stats. A healthy market is when there are two actives to every pending.
There are a couple areas (in red) where the number of pendings have dropped significantly. But in six of the more-expensive areas, there are the same number of pendings now as there were last month:
All we have to do is muddle through the next three months!
In 2020, we had 400+ pendings from June 22nd to November 30th – with a peak of 491 pendings on September 7th.
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