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NSDCC September Sales

There might be a few stragglers left to report, but this gives us a good reflection of how the summer wrapped up after the frenzy started cooling in June:

NSDCC September Sales

Remember when sales prices were lower than list prices?

  • The median sales price in September is 5.3% higher than the median list price.
  • The median sales price rose 34% year-over-year.
  • The sales count is the third highest ever.

If there were more homes for sale, nobody would be talking about a cooldown!

Inventory Shortage

The NSDCC Monthly Sales were hopped up in April and June of this year, but are now getting back in line with previous years. Is the demand ‘cooling off’, or is it because we don’t have enough homes for sale?

NSDCC Listings & Sales

Year
June Listings
July Listings
August Listings
3 mo. total
August Sales
Median SP
2018
476
447
433
1,356
275
$1,325,000
2019
435
459
418
1,312
262
$1,354,500
2020
448
487
457
1,392
350
$1,419,812
2021
386
357
307
1,050
267
$1,950,000

If the number of listings between June-August is usually around 1,350, we are 22% below that this year.

Yet the number of August sales is about normal. But the 37% YoY increase in the median sales price suggests that the demand is not only strong but that we’d have more sales if there were just more listings!

Frenzy Monitor

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.

Our Big Three – Carmel Valley, Encinitas, and SE Carlsbad – continue to carry substantially more pendings than active listings, but both La Jolla and Rancho Santa Fe have similar pending counts, which is incredible given their much-higher price points:

NSDCC Actives and Pendings

The average days on market is creeping upward, but still no big concerns. There will always be sellers who would rather wait for the lucky sale, than adjust their price – and longer average market times indicate more sellers doing the former:

The $1,500,000 – $2,000,000 range has been the hottest all year, but their average DOM is at its high – while the rest are well below theirs!

NSDCC Year-to-Date

This year, we are ahead of both of the previous years in total sales, in spite of having 14% fewer listings – and prices being 30% to 40% higher!

NSDCC Listings & Sales, Jan 1 to Aug 31

Year
# of Listings Between Jan 1 – Aug 31
# of Sales
S/L %
Median SP
2019
3,585
1,922
54%
$1,310,000
2020
3,245
1,846
57%
$1,409,677
2021
2,805
2,245
80%
$1,875,000

Prices probably need to go a bit higher to slow this thing down!

The NSDCC Weekly Pendings are tracking similar to 2019, so there should still be some gas in the tank:

None For Sale Under $1,000,000

And only three for sale under $1,100,000!

It’s not the end of the world, though.

It’s not even the end of homes for sale under a million – there will be others.

But it is the velocity of the frenzy that is astonishing.

Detached-Homes For Sale Under $1,000,000 Between La Jolla and Carlsbad, 2nd Week of August:

2018: 115

2019: 101

2020:  33

2021:   0

Leading up to 2020, the market was balanced, orderly, and behaving about like you’d expect.  Buyers were critical, and there were plenty of homes not selling.

Then a virus hits, and blows the roof off!

NSDCC First-Half Report

The number of NSDCC first-half sales are 15% higher than the 2017-2019 average number of sales, and

THE MEDIAN SALES PRICE IS +32% YoY:

NSDCC Sales, Jan 1 to June 30

Year
# of 1H Sales
Median SP
# of Sales Over $2M
Over $2M/Total Sales %
2017
1,585
$1,225,000
292
18%
2018
1,411
$1,325,000
311
22%
2019
1,379
$1,300,000
298
22%
2020
1,145
$1,400,000
267
23%
2021
1,674
$1,850,000
737
44%

In 2009, there were 756 NSDCC sales for the entire year, and only 76 of those were over $2,000,000.

In 2021, we’ve had 737 sales over $2,000,000 in the first six months!

Back to Normal

Random thoughts:

Having 130 NSDCC homes in June sell for $100,000+ over list price should be an all-time record. If we had half that many, it would be astonishing!

But those were decisions made in April and May.

It feels like the market is in the deceleration stage, where fewer homes are worthy of a bidding war.  Sellers and agents who insist on adding an extra 5% to 10% to their list price will need to be selling an exceptional property AND present it perfectly to generate offers.

The inferior homes/locations (the ones who really benefited during the peak frenzy) will be the ones that feel it the most. The gap between the dogs and the creampuffs will widen.

Listing agents who “have comps”, and around $5, can get a cup of coffee.

Open houses will help with the transparency.  Buyers and lookers will be able to experience the upgrades in person, and get a better read on the traffic.  The art of determining the difference between lookers and buyers will be renewed.

There will be eye-popping sales.

We will find peace with these higher prices.  We would have gotten here eventually – it just happened faster than we ever thought possible.

Higher interest rates won’t have a big impact – there’s too much cash in play to soften the blow. One thing you can count on – sellers won’t care about higher rates.  They aren’t in a hurry, they don’t have to sell, and they aren’t going to give it away!

If prices were to come down, it would be slowly and over time.  There will be occasional deals that give hope to lower pricing, but then a couple of high sales will happen right behind them.

The ibuyers might be the only candidates who could influence the market in a panic, but they could rent their homes for a while if they had to. They are big corporate entities who are used to losing money, so no real pressure.  The old accounting rules REQUIRED banks to sell their properties quickly, but those days are long gone.

More potential sellers will give up the thought of moving, and the number of homes for sale could stay restricted – or even go lower. The hope of there being a post-covid surge of sellers will wane.

If there were an occasional surge of new listings, they would all be priced based on recent sales…..or priced higher.  If buyers don’t like today’s prices, having more inventory priced the same won’t help.

The statistics will bounce around more as we pull into Plateau City.

All of the above (except #1) should remind you of how it used to be!

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

NSDCC May Listings & Sales

We’re still waiting for that flood of inventory!

NSDCC May Listings and Sales

Year
# of Listings
Median LP
# Sales
Median SP
Avg. $/sf
Median $/sf
2017
507
$1,370,000
345
$1,200,000
$525/sf
$418/sf
2018
522
$1,399,450
273
$1,325,000
$592/sf
$480/sf
2019
502
$1,450,000
297
$1,365,000
$598/sf
$502/sf
2020
484
$1,579,716
143
$1,395,000
$565/sf
$488/sf
2021
396
$2,000,000
301
$1,989,000
$769/sf
$655/sf

Last month’s sales didn’t set a record, but they were very strong given the shortage of inventory which was about 25% under the usual number of May listings.

Check the YoY price increases for May:

Median Sales Price: +43%

Average $$/sf: +36%

Median $$/sf: +34%

No matter how you measure it, pricing is through the roof!

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