I agree that homes selling quicker – evidenced by the lower market times – means crazy price increases. Sellers can get away with pricing their home at 5% to 10% above comps and buyers still come running.
How crazy is it?
More than half of our sales are finding their buyer in 14 days or less!
NSDCC November Sales
| Year | |||
| 2019 | |||
| 2020 |
Let’s also note that by the time we’re done, there will be close to 300 sales this month, which is unheard of for November!
Let’s use their formula (total sales/total listings) to calculate the NSDCC ratios.
(their ratios were from June, 2020)
NSDCC SFRs Sales/Listings over $1 million
June, 2020: 210/392 = 54%
October, 2020: 300/328 = 91%
We have it good!
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Read article here:
https://www.wsj.com/articles/buying-a-home-during-coronavirus-11603988728
We’re only three days into October so there will still be more reporting in the coming days….but September sales are pouring in! We had 52% more sales than we had last year in the La Jolla-to-Carlsbad market!
NSDCC Detached-Home Sales, September:
| Year | |||
| 2016 | |||
| 2017 | |||
| 2018 | |||
| 2019 | |||
| 2020 |
Until recently, you could expect that $10 million would buy you an oceanfront home in La Jolla.
But just in the last 30 days there were oceanfront sales of $14,000,000, $16,000,000, and this one in Bird Rock just north of Pacific Beach that sold for $19,250,000:
It’s October!
The La Jolla-Carlsbad market had an incredible September, with sales up 43% YoY, and the median sales price was +10%! We’ll have another 20-30 sales reported in the coming days too.
NSDCC Detached-Home Sales, September:
| Year | |||
| 2016 | |||
| 2017 | |||
| 2018 | |||
| 2019 | |||
| 2020 |
In September, 2013 we had 275 sales – the most in recent history. We’ll be over 350 this year!
The impending ‘upgrade’ of the MLS starts today at noon, and last until Monday. It will screw up my stats for usual Inventory Watch on Monday morning, so here’s a mid-week preview.
Today there are 491 NSDCC detached-homes in escrow, which the highest number I’ve seen. The huge number of pendings isn’t due to escrows not closing either:
NSDCC Detached-Home Sales, September 1-15
2012: 127
2013: 114
2014: 112
2015: 117
2016: 130
2017: 139
2018: 107
2019: 102
2020: 149
We still have late-reporters too, so this year’s count should get up close to 160!
But you can feel the slowdown coming, and I think it’s purely because there aren’t more houses coming onto the market. We already had the lowest number of August listings in recent history, and the rest of 2020 probably won’t get any better:
Are sellers waiting for the 2021 selling season? Probably! Buyers will be waiting!
Above are the North Coastal interactive graphs broken down by price (which includes Oceanside, which doubles the inventory of homes for sale under $1 million vs. NSDCC). Our total sales in 2020 should be about the same as they were last year, which is a reminder that 30% to 40% of the listings every year don’t sell – the more-casual sellers didn’t bother to list at all this year.
Interesting that the higher-end pendings are currently setting records for any time of year. The elite are taking advantage of the low rates and are on the move!
Here is the recent history of August sales of detached-homes between La Jolla and Carlsbad:
| August, Year | ||
| 2013 | ||
| 2014 | ||
| 2015 | ||
| 2016 | ||
| 2017 | ||
| 2018 | ||
| 2019 | ||
| 2020 |
The 2013 frenzy was a result of the renewed optimism coming out of the last foreclosure crisis – back when most of our sales (57%) were under a million! This August? Only 18% were under a million!
In August 2013, we had 12 sales over $3,000,000. This year? 44!
Plus we still have the late-reporters – we could hit 350!
Our San Diego Case-Shiller Index is 10% above the previous peak of November, 2005.
But that covers the whole county, so it made WC Varones speculate that the appreciation in NSDCC was higher – as much as 30% to 40% above peak.
Our peak was later, so I searched the 2006-2007 time frame for tract homes so the second sale probably wasn’t a result of a major remodel. The sellers may have added new carpet & paint, or maybe a pool. But for the most part, they were selling the same home that they bought.
Here are examples:
| Address | |||
| 3303 Corte Del Cruce | |||
| 3313 Avenida Anacapa | |||
| 3638 Sage Canyon | |||
| 3411 Camino Corte | |||
| 1186 Quail Gardens | |||
| 3210 Avenida La Cima | |||
| 7574 Circulo Sequoia | |||
| 511 Paloma | |||
| 13056 Seagrove | |||
| 5816 Blazing Star | |||
| 2433 7th St | |||
| 4475 Philbrook Sq | |||
| 13689 Winstanley |
The average is +31%!
The last entry on Winstanley is the home I sold in June, and I’ll never forget it.
The seller – who had been reading the blog – had told me when he bought it in late-2007 that he expected to lose $100,000 but he wanted to make his wife happy. I told him to hang in there, and let’s see how it goes!
We still have four days to go this month, so it looks like we’ll be setting new monthly sales records again, just like last month (even with a covid asterisk):
| Town or Area | |||||
| Cardiff | |||||
| NW Carlsbad | |||||
| SE Carlsbad | $1,165,000 | ||||
| NE Carlsbad | |||||
| SW Carlsbad | |||||
| Carmel Valley | |||||
| Del Mar | |||||
| Encinitas | |||||
| La Jolla | |||||
| RSF | |||||
| Solana Beach | |||||
| NSDCC |
I don’t have too much concern about changes to the median sales prices due to the smaller sample sizes, and I doubt there are any buyers out there who would say prices are down.
Last year we had 56 sales over the last four business days of August, so we’ll probably see 300+ this month when it’s all done. Will sales slow a bit towards election day? Only if the supply winds down?
We hear the term, ‘tight inventory’. What does it mean?
Fewer homes for sale?
Fewer of the lower-priced homes for sale?
Homes selling faster?
The best buys are flying off the market in the first day or two?
NSDCC detached-home statistics for Jan 1st – Aug 15th:
| Year | ||||||
| 2016 | ||||||
| 2017 | ||||||
| 2018 | ||||||
| 2019 | ||||||
| 2020 | ||||||
| 20vs19 |
The average and median Days-On-Market metrics are within the normal range, so generally-speaking, homes aren’t selling faster than before.
We’ve had fewer homes for sale (-12% YoY), but sales are only down 8% which isn’t bad. The drop in sales between 2017 and 2018 was slightly more at 9% so we’ve endured this previously.
The overall volume is only down 0.4% YoY ($3,000,850,233 vs $2,988,471,818) – so those on commission (realtors, lenders, escrow, and title) shouldn’t be too concerned with ‘tight inventory’.
Who should be concerned?
Buyers on the lower-end of every market.
We have eleven NSDCC houses for sale priced under $900,000 (in an area of 300,000 people):
Two of those aren’t on the market yet (coming soon!), and a third has a contingent buyer.
Tight inventory = buyers are getting squeezed up on price.
Are you looking for an experienced agent to help you buy or sell a home?
Contact Jim the Realtor!
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