NSDCC October Listings

Next year, everyone will be talking about how mortgage rates in the 7s or 8s will be causing a lack of affordability, but I have bad news for those who still want to buy.

There probably won’t be many homes for sale.

It will only take one or two headlines about the real estate market being crushed by high rates to cause potential sellers to pack it in until “the market gets better”.

Look how few sellers came to market last month:

NSDCC Detached-Home Listings, October

Number of Listings
Median List Price

Before last year, the lowest October-listings count over the last twenty years was 312 in 2012, and back in the golden years of real estate, there were 452 October listings in 2001, and 510 in 2002!

510 vs. 174?


Hopefully, those who do list their homes for sale next year will be highly motivated, and, lucky for them, having so few competitors will cause their list prices to stay elevated.

Don’t be surprised if the 2023 spring selling season ends up being the Greatest Standoff Ever!

NSDCC October Sales, Preliminary

I’ve been hoping for 100+ sales per month the rest of the way this year.

Currently, the October count is 108, so it should get up to around 120 sales by mid-November.  Here are the monthly sales and pricing for 2022:

NSDCC Detached-Home Monthly Sales & Pricing, 2022


I noted last week that the September average and median sales prices were both 23% lower than they were in March. It looks like the final October data could end up being higher.

The average and median sales prices are easily affected by the types of homes that are selling.  The recent environment has had smaller, less-expensive homes selling, while the higher-end market has been languishing.

Let’s include more statistics to fill out the picture:

Average SP
Avg $$/sf
Avg SF
Median SP
Med $$/sf
Med SF

While the October average and median sales prices make it look like we’ve turned the corner, once you analyze the house sizes and $$/sf, you’ll see that buyers are still getting more for their money today.

Unfortunately, none of the talking heads in the media will look any further than the median sales price.

Once their house-hunting vacation concludes in February, all potential home buyers will do is decide if the change in the median sales price supports their mindset about purchasing.

NSDCC Pendings Since 6% Rates

The national bashing of the real estate market continues unabated, and I’m sure there are individual markets that are really feeling it.  But real estate is local, so let’s examine the facts.

To get a sense of what has been happening since rates got into the 6s, let’s review NSDCC homes that have gone pending recently. You don’t have to know the streets or the particular homes – just scroll through the bunch and you’ll get the feeling that frenzy pricing is still lingering. Click on any for the full listing:

NSDCC Median $/SF

Instead of using the median sales price as a gauge, let’s look at the history of the median $/sf to help bring the size of the homes into the equation.


I remember 2018 and 2019 being fairly flat and a bit of a struggle.  Rates had been in the 3% to 4% range during the 2015-2017 period, and once they got back into the mid-to-high 4s in the summer of 2018, pricing hit the skids.  Luckily, rates dropped under 4% in late-2019 which caused us to be optimistic about the selling season of 2020 – and you can see that pricing got off to a good start.

The Pandemic Stall caused a blip in April, 2020, but we recovered and charged into 2021.  You could say that local pricing took off like a rocket, rising 25% in five months:

Jan 2021: $559/sf

Jun 2021: $697/sf

Today we are under where 2022 started, and it could get worse. However, the median for the 38 sales closed this month is an impressive $823/sf, which is 4% higher than last month.

But we have a long way to go!

Speaking of a long way to go, Rob Dawg wanted to stir it up, like most Dodger fans.  We have been subject to endless taunting since making the playoffs, including Charlie Steiner suggesting that the Padres rivalry with the Dodgers would be like a nail having a rivalry with a hammer.

Just you wait!

Bob Melvin has engineered the greatest rope-a-dope since Muhammad Ali. Sacrificing the first game last night with Clevinger vs. Urias was ingenious, because Kershaw is washed up and due for a dud – and Darvish has been lights out.

The Padres win tonight, and then come home to the raucous crowd who hasn’t seen a playoff game in 16 years, and Petco Park will be rocking for Snellzilla. Then we got No-No-Joe for Saturday’s game and the Dodgers will have to bring back Urias early on three days rest and he won’t have enough.

This is the last chance to get on the Padres bandwagon!

NSDCC September Sales

The number of NSDCC detached-home sales in September is up to 133 today, which is pretty good.  There are only 138 pendings currently, but 34 sales have already closed in October so there is a decent chance that we’ll have 100+ sales this month too!

The drastically-lower YoY sales will give participants the idea that the market conditions keep deteriorating, but to me, it is a sign that sellers are holding out on price.

If we can just average 100 sales per month in the fourth quarter, I’d consider it a successful end to 2022!

It’s natural for most buyers to want to see what happens in springtime, and I think we can all predict what’s coming.  The 2023 home sellers aren’t going to believe that the old comps don’t matter any more – and they will price their home within 5% of the peak pricing.

Recent Sales By Zip Code

For those who are willing to investigate the sales data in our local areas, here are the detached-home sales from the last 90 days. Poke around a little, and I doubt you’ll believe that we’re getting ‘creamed’.

NW Carlsbad 92008 sales – last 90 days

SE Carlsbad 92009 sales – last 90 days

NE Carlsbad 92010 sales – last 90 days

SW Carlsbad 92011 sales – last 90 days

Encinitas 92024 sales – last 90 days

La Jolla 92037 sales – last 90 days

Rancho Santa Fe 92067 sales – last 90 days

Del Mar 92014 sales – last 90 days

Solana Beach 92075 sales – last 90 days

Carmel Valley 92130 sales – last 90 days

The highlights: three RSF sales over $10 million in the last 90 days; nine sales above $5,000,000 in La Jolla (and 60 sales overall!), 81 sales in Encinitas – more than one every business day; and of the 182 sales in Carlsbad, 46 of them were $2,000,000 and higher.

Summer Listings & Sales History

Chris asked how the current environment compares to the 2008 downturn.

In the summer of 2008, there were only 601 NSDCC sales between June 1st and August 31st, in spite of there being 1,348 listings that summer. For the next two years, the number of listings far exceeded the number of sales, and in the 2008-2010 period there were twice as many listings as sales. The 2010 ratio was the worst at 2.3 to 1.

This summer we only had 825 listings, and 504 sales, which is a 1.6 to 1 ratio!

The 2022 sales were 16% lower than the previous record in 2008, but there were 39% fewer listings!

We’ve never had so few listings to consider. Now that the Fed is making it so obvious that they intend to cause a recession, more potential sellers – who tend to casually read the headlines only – will delay their decision to move.  Does anybody HAVE to move in 2023?  Every potential seller will give it a second or third thought if they believe it will cost them several hundreds of thousands of dollars.

The NSDCC inventory next year will be the lowest ever – even Ray Charles can see that coming.

Estimating NSDCC Monthly Sales

The latest CPI number is out today, and the over-reaction will put more pressure on mortgage rates.  They are probably going to be around the 6% range for the foreseeable future.

Let’s predict the NSDCC monthly sales count for the rest of the year.

Today, we have 411 active listings, and we are back to the environment where we can expect that only 60% of those have a chance of selling.  It’s probably too late for any active listing to close in September, so let’s sprinkle those 247 probable sales over the next three months, or 82 per month.

There are 152 pendings today, and 111 of those went pending before September 1st. They have released all contingencies on most of those, but let’s say only 100 actually close, and 90 are September closings.

Of the other 41 listings that just went pending, only half of them will close, or 20.

There have been 45 sales already close in September, so adding the two is 90 + 45 = 135 sales this month.  Last September we had 269 closings.

NSDCC Monthly Sales, estimated:

September: 135

October: 110

November: 90

December: 90

4Q22 = 290

There will be other new listings over the next three months that will close, and it would be great if every month has 100+ closings – so the above is hopefully the worst-case scenario. But even if we have 300 or more closings in the fourth quarter, look at how that compares to recent NSDCC history:

4Q21 = 636

4Q20 = 977

4Q19 = 681

Even though the month-over-month change in the CPI looks very healthy, the panic will ensue and the real estate markets shut down until February….and probably get off to a slow start then.

People still want to buy, and people still want to sell.  Everyone will just be waiting around until February, hoping something will be different!

Post-Frenzy Coffee Bet

The last coffee bet began in 2006 when it was obvious to me and others that the market bubble was popping, so let’s examine the data back to those years to see if we can learn anything that might be helpful when trying to predict the future:

NSDCC Listings and Sales between January 1st and August 31st:

Number of Listings
Number of Sales
Median Sales Price

The most recent non-pandemic years, 2018 and 2019, were eerily identical, which suggests that the same market conditions can prevail for years in spite of rates (which varied from 4.03% in January, 2018 to 4.87% eleven months later, and then back down to 3.72% in December 2019).

The most stunning data point is how the number of listings has plummeted this year, even though sellers could have sold for all-time high prices. Record pricing used to motivate more people to sell, not fewer!

Agents sitting on unsold properties will ‘refresh’ their listings every month or two, and those days are back so we’ll probably have at least the same amount of 2023 listings just due to the extra 10% to 20% of refreshers. But the inventory is going to be bleak no matter what happens, so that alone will drive the market in 2023 and beyond. Here is a visual:

The thing I remember most from the last downturn was how the market turned earlier than expected. There was a blog post from April, 2009 entitled Coffee Bet 2 where I thought prices would go down another 25%, when that month ended up being the actual trough for the SD Case-Shiller Index.

Even with the buyers who over-analyze and stay on the sidelines for 2-5 years, there will be others – mostly those out-of-towners who don’t have a house here yet – who will buy when they find the right house.

Sales will likely be dreadfully low, and I think NSDCC pricing will be FLAT in 2023.

During the selling seasons, there will be some spectacular sales of those family estates with big yards and pool on culdesacs…..and prices trend higher!  But then as the inventory diminishes over the rest of the year, the pricing either goes flat or we give it all back in the second half of the year – like what happened in 2018 and 2019…and what will probably happen in 2022 too:

Here are NSDCC markers for this year:

January 2022:

Median List Price: $2,219,888

Median Sales price: $2,250,000

August 2022:

Median List Price: $2,200,000

Median Sales Price: $2,150,000

If it weren’t for those crazy three months before rates went up last spring, the 2022 data would probably have already looked fairly flat anyway, so it’s really not risky for me to guess that it will continue. There will be crazy-high sales, and stunningly-low sales too, but in the end, we’ll be living in Plateau City.

In the first coffee bet of 2006, I used the Davidson Starboard tract as a marker, and coincidentally I have a listing there now.  The neighborhood is arguably the best in the area, and La Costa Oaks South homes in general, are among the newest and most desirable homes in SE Carlsbad.

Let’s look up at the end of 2023 and see how the LCOS median sales price compares – even with it being inflated by early-2022 sales.  These closings are from the last six months:

Even if the median sales price deteriorates somewhat in the next 15 months, I predict that my sale will be the lowest Plan 2 sale in the interim, and there won’t be any LCOS sales below $2,000,000 between now and the end of 2023 (the $1.875M sale was FSBO).

The ultra-low number of listings in 2023 will throttle any big price changes in either direction.

My NSDCC pricing guess for 2022 was +/- 5%, and is close, and next year will probably be similar too.

I’m sticking with ZERO change in pricing next year – which isn’t a sexy number but will reflect the general malaise and discomfort among the participants we hope for lower rates but know they won’t change enough to make much difference anyway.

Frenzy Monitor – End of Summer

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’ve considered a 2:1 ratio of actives-to-pendings to be a healthy market.

Most areas today have the same or better stats as they did last month. The number of active listings hit their peak in August last year, as usual, and it’s likely that the count of unsold listings will drop slowly over the rest of 2022 (and the pendings follow). Prepare for 2-3 months of NSDCC sales being under 100!

NSDCC Actives and Pendings

Taking out the high-enders La Jolla and Rancho Santa Fe, the actives-to-pendings is 2.4-to-1 (291:121), which isn’t bad, all considered.

Mid-February, and the 2023 Selling Season, is only six months away!

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