Here are the histories, and forecasts, of our local Zillow Home-Value-Index for each area:
They are forecasting flat or declining prices in three of our larger areas – and they are also predicting a drop-off in values as the selling season will be getting underway in March, 2020 (which sounds far-fetched).
Their track record hasn’t been that great though. Here is their Carlsbad prediction in December, 2015, when they expected a 1.9% increase for 2016 – the actual was +7%:
The Carlsbad HVI has risen 19% since the beginning of 2016!
Can we agree on one likelihood? Prices probably won’t be going up much in the next year or two.
Being a casual home buyer is fine, and most people are.
They’re looking for the perfect home for them, and they will know it when they see it. But because virtually every house needs something – even new ones – it can be a long hard road in search of perfection.
Try this approach.
Instead of declaring yes or no on each house you see, put a number on it.
At what price would you buy it?
It takes more time to research the comps and compare the features, but it gets you onto the playing field. Here are some of the benefits:
Hone your home-evaluating skills.
Get more familiar with the comps.
Identify what features are most important to you.
If you do make an offer, it bolsters your case with seller.
Your offer negotiations have a specific target.
If you don’t make an offer, it prepares you for the next time.
When do you make an offer?
If your research concludes that you might pay within 10% of the list price, then make a written offer and see where it goes.
If your price is more than 10% below list, then call it in and see what the listing agent says. Nine times out of ten they will hang up on you….and you’re looking for the tenth!
The yes-or-no approach won’t buy you a house – instead, put a number on it!
The percentages are quite a bit higher this year. The title of the graph could be ‘Sellers Who Are Having No Showings’ because most are (overly) optimistic this early in the selling season and hold tight on price until later. Something must be rattling them – like no showings.
An excerpt from the UT article:
Home price reductions are still common when the market is red hot. It is sometimes a selling tactic — although not usually considered a good one — to price a home higher and then come down so the buyer feels like they are getting a deal. But, the number of reductions recently shows a big change.
For instance, 8.5 percent of homes had price reductions in November 2016. In November 2018, there were 29.4 percent.
Jason Cassity, a real estate agent based downtown, said the industry has a problem shifting when there has been a big change — such as a downturn in sales at the end of last year. He said some agents are operating like there will still be a bidding war.
“If you continue pricing like it is 2016, it is going to sit on the market a long time,” he said. “Or you are going to be one of those 20 percent (in February) that have to price reduce.”
He said a lot of the reductions he has seen were listings marked up too high out of the gate, something a lot of agents could get away with for years. He said sometimes homes are priced overly high just to meet sellers’ expectation of a huge payday, not the actual value.
Cassity said he presents news articles about the real estate market to clients before they decide on what price they are going to market with.
I went to the grand opening today of these $2,000,000 tract homes and thought because of the rain that I might be the only one there. Wrong! There were hundreds of people – and this isn’t Carmel Valley – not even close:
How can the market keep going? Generational wealth distribution!
Among respondents with an annual income over $100,000 who anticipate familial help with a down payment, the average expected level of support is over $50,000, enough for a 20 percent down payment on the national median condo price.
This is more than twice the expected down payment assistance of those making between $50,000 and 75,000, and over ten times that of those making less than $25,000, who expect to receive $4,358 on average.
This finding highlights the chronic nature of wealth inequality — not only do lower-income millennials have less purchasing power themselves, but their families have less support to offer.
We find that when it is available, familial down payment assistance can put homeownership much closer in reach.
Among millennials earning more than $50,000 and expecting help with a down payment, we estimate that 32.8 percent will be able to acquire a 20 percent down payment within the next five years, compared to 19.8 of those with similar earnings but no expected down payment assistance.
Among those earning less than $50,000, the prospects are notably worse, but those who expect down payment help still see a significant step up compared to those expecting no help. While help from family can make homeownership a more attainable goal, this option is available to a minority of millennials, with the largest benefits accruing to those earning the highest incomes.
"Jim and Donna Klinge are by far the most professional, personable and responsive realtors I have ever worked with. They provide VIP concierge level service in every area of the process of selling your home. My home was marketed so successfully that we received an offer the day after our first and only open house. Thanks to Jim's pricing and negotiating, our house is now the highest sold in our community... more "
by Ann Romanello
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