In the last week, there were 67 new listings between La Jolla and Carlsbad – the highest weekly count in 2024 and only the second time over sixty this year. But the appearance in the graph above was muted because there were 36 new pendings, and 42 closings – which is good flow! There have been 36 new pendings in three out of the last four weeks, which doesn’t suggest much of a slow down.
We’re already up to 165 sales this month, the same as last April! The median sales price YoY is up 8.3% too.
It’s just a matter of time before a big player brings the auction format to the residential resale market. These guys are in position – they are auctioning commercial properties, and with their sister company Homes.com wanting to be the #1 search portal, it would be a natural transition:
When Sotheby’s sells paintings at auction, no one thinks of them as being distressed.
So why does real estate sold at auction get a bad rap?
Ten-X, the world’s largest online commercial real estate exchange, makes a positive case for auctions as the fastest and most accurate way of finding a property’s true value. By combining 21st Century online sales tech with industry-leading data from CoStar, Ten-X cuts through the inefficiencies of the traditional sales process, finding sellers the right buyer in an average of 100 days from marketing to close.
TRD sat down with Ten-X President Steven Jacobs and Vice President Victor Gutierrez to learn how their platform is perfect for sellers feeling stress in the current market, who need to get assets off their books before they become distressed.
Ten-X’s sales platform is built to establish a property’s value from the start and then find the right buyer in a timely fashion with as little back and forth as possible. But what may seem like an obvious way of doing business is actually the reverse of how most real estate deals are done.
“The way traditional sales are done is fundamentally backwards,” says Gutierrez, who describes the inefficiencies of the normal process: “I give you a bit of information, and then you give me the price you’re willing to pay, and then I give you the rest of the information, and then you adjust your price, and now we’ve been going back and forth for months.”
“When you’re selling a property, by the time you get through the first and second round of offers, then the best and final round and pick an investor, it’s taken five or six months,” adds Jacobs. Only then does the due diligence begin, after which, “a majority of the time you get a retrade.”
In the end, months after going to market, the result is a deal for a lower price than the initial offer. “It becomes a negative experience,” says Jacobs.
With Ten-X, this order of operations is turned on its head. “The buyer does the due diligence before making an offer,” explains Jacobs. “As a buyer, by the time you come to the auction, you’ve read the rent roll, you’ve toured the asset, you’ve looked at the financials, you’ve seen the property condition report. You’ve had access to best-in-class CoStar data and documents. All the stuff that you typically have to do post-contract, you’ve already done beforehand.”
This transparency benefits both sellers and buyers. For sellers, they can complete a sale in a fraction of the time as a traditional deal while retaining a similar degree of control over the price thanks to their ability to set a reserve price under which they can choose not to accept an offer. For buyers, not only do they have all the information before making a bid, but the process is transparent and fair, what Jacobs describes as “an even playing field.”
Buyers, like sellers, access the Ten-X platform through a robust digital platform that puts all the information they need to make an informed bid at their fingertips. Ten-X has also brought Stripe technology to the platform, which has streamlined the buying process further by giving bidders the ability to securely link their bank accounts for instantaneous approvals and real-time proof of funds updates.
Saturday wasn’t enough! Join me today (Sunday) in Mission Hills for an encore open house from 12-1pm!
2235 Linwood, #A4, San Diego (off Bandini)
2 br/2 ba, 832sf
YB: 1987
HOA fee = $495/mo.
LP = $699,900
Live in Mission Hills among the multi-million dollar homes and share similar ocean views! This cute and cozy 2br/2ba single-level home is at the top level of the Terraces of Mission Hills and is walking distance to the fabulous Old Town historic district including the Old Town Mexican Cafe! Get to Petco Park/downtown, Mission Beach, Hillcrest, or OB within minutes – you’ll love this location! Two primary suites, good-sized kitchen, fireplace, and your own washer and dryer inside. This gated community includes two assigned parking spaces too – wow! Close escrow in time for the big Fourth-of-July fireworks show!
How bad can it be in Mississippi? Oh wait, don’t answer that.
Median-priced homes in these states cost $300,000 or less, a significant discount compared with the U.S. median price of $402,343.
While these 14 states may have cheaper properties available, there are trade-offs to consider, like higher rates of poverty and fewer high-paying jobs compared with the rest of the country. Many of them are among the most rural in the United States, and incomes in rural areas tend to be lower than in urban cities.
In contrast, you’d need to make $197,057 to afford a median-priced home worth $739,200 in California — the highest amongst all states.
In February, their annual appreciation guesses were in the 3% to 4% range. In March, they got excited and bumped all local areas up to 4.9% to 6.3%! They are back to the 2.2%-3.9% range, with Carmel Valley clocking in with a solid 4.3% over the next 12 months.
It probably means that pricing will be fairly flat until next year:
Carlsbad NW
Carlsbad SE Carlsbad NE Carlsbad SW
Carmel Valley Del Mar Encinitas La Jolla Rancho Santa Fe
There may be a lot of turbulence around real estate these days, but sales keep happening!
The pricing metrics are up 5%-6% since last April, and we’re not done yet with sales this month. Helped by Easter being on March 31st this year, the final count of closings for April, 2024 is probably going to exceed last year’s 165 sales – wow!
It was so great to start the tour today with Pete’s new listing on the Encinitas Ranch Golf Course whose owners succumbed to the problem at hand. They get hit by golf balls, so provide a barrier and live with it.
This is way better than the alternative where potential buyers have to wonder about the impact. Know this – when a golf ball hits your roof, it sounds like a bomb went off.
We lost Gregg LeNoir Allman in 2017 at age 70, and we lost Dickie last week at age 80 – rest in peace. We won’t see anything like this again. (hat tip just some guy):
“Melissa” (sometimes called “Sweet Melissa”) is a song by American rock band the Allman Brothers Band, released in August 1972 as the second single from the group’s fourth album, Eat a Peach. The song was written by vocalist Gregg Allman in 1967, well before the founding of the group. Two demo versions from those years exist, including a version cut by the 31st of February, a band that featured Butch Trucks, the Allman Brothers’ later drummer. Allman sold the publishing rights later that year, but they were reacquired by manager Phil Walden in 1972.
The song’s title is frequently referred to incorrectly as “Sweet Melissa” due to the lyric being sung at the end of each of the first two choruses.
The version on Eat a Peach was recorded in tribute to Duane Allman, who considered the song among his brother’s best and a personal favorite. He died in a motorcycle accident six weeks before its most famous rendition was recorded.
Gregg Allman penned the song in late 1967. He had previously struggled to create any songs with substance, and “Melissa” was among the first that survived after nearly 300 attempts to write a song he deemed good enough. Staying at the Evergreen Motel in Pensacola, Florida, he picked up Duane’s guitar which was tuned to open E and immediately felt inspired by the natural tuning. Words came naturally, but he stumbled on the name of the love interest. The song’s namesake was almost settled as Delilah before Melissa came to Allman at a grocery store where he was buying milk late one night, as he told the story in his memoir, My Cross to Bear:
It was my turn to get the coffee and juice for everyone, and I went to this twenty-four-hour grocery store, one of the few in town. There were two people at the cash registers, but only one other customer besides myself. She was an older Spanish lady, wearing the colorful shawls, with her hair all stacked up on her head. And she had what seemed to be her granddaughter with her, who was at the age when kids discover they have legs that will run. She was jumping and dancing; she looked like a little puppet. I went around getting my stuff, and at one point she was the next aisle over, and I heard her little feet run all the way down the aisle. And the woman said, “No, wait, Melissa. Come back—don’t run away, Melissa!” I went, “Sweet Melissa.” I could’ve gone over there and kissed that woman. As a matter of fact, we came down and met each other at the end of the aisle, and I looked at her and said, “Thank you so much.” She probably went straight home and said, “I met a crazy man at the fucking grocery.”
Allman rushed home and incorporated the name into the partially completed song, later introducing it to his brother: “[I] played it for my brother and he said, ‘It’s pretty good—for a love song. It ain’t rock and roll that makes me move my ass.’ He could be tough that way.” The duo produced a demo recording of “Melissa” that later surfaced on One More Try, a compilation of outtakes released thirty years later. In 1968, the duo recorded it during a demo session with the 31st of February, a band that featured Butch Trucks, the Allman Brothers’ later drummer. That version is thought to have featured the debut recorded slide guitar performance from Duane Allman, and the entire session was later compiled into Duane & Greg Allman, released in 1972. Gregg Allman sold the publishing rights to “Melissa”, as well “God Rest His Soul” (a tribute to Martin Luther King Jr.), to producer Steve Alaimo for $250 (equivalent to $2,190 in 2023) shortly thereafter. He had been tied up in Los Angeles, contractually bound by Liberty Records (who had previously issued albums by the Allmans’ first band, the Hour Glass), and used the money to buy an airplane ticket to fly back.
When Duane Allman was killed in a motorcycle accident in 1971, his brother performed the song at his funeral, as he had grown to like the song over the years. Gregg Allman commented that it “didn’t sit right” that he used one of his brother’s old guitars for the performance, but he nonetheless got through it; he called it “my brother’s favorite song that I ever wrote.” Both because he did not own the rights and found it “too soft” for the band’s repertoire, he never mentioned the song to the members of the Allman Brothers Band. Following Duane’s death, manager Phil Walden arranged to buy back the publishing rights in order to record the song for Eat a Peach, the band’s fourth album. Gregg brought it to the studio the day following his birthday and the band recorded it that afternoon at Criteria Studios in Miami, Florida. They felt it lacked a compelling instrumental backing element so guitarist Dickey Betts created the song’s lead guitar line.
They are only three months into their mega-launch of Homes.com, and CoStar founder and president Andy Florance is already taking victory laps. He is also the #1 cheerleader for buyers going directly to the listing agent, which will be the end result of all the changes underway. Here’s Andy talking in front of a group of realtors:
Florance said Homes.com’s “Your Listing, Your Lead” model was the antidote to agent and consumer frustrations, as evidenced by triple-digit traffic growth during Q3 2023 that gave them a contested lead on Realtor.com as the second-most-trafficked residential portal.
“In the rest of the world, when an agent has a listing, their name is on the listing, their phone number is on the listing, and there’s branding happening,” he said to riotous applause. “Only in the United States is it the portals’ brand goes on the listing rather than the agents’ brand. That’s bizarre.”
Although CoStar didn’t reveal its exact plans for Matterport, Florance did outline a plan to capitalize on digital twinning, a term used to describe hyper-realistic 3D listing experiences.
Florance said digital twinning could enable homebuyers to visualize what their current home furnishings would look like in a new home, play with renovation options for a fixer-upper, or walk with a virtual agent through a virtual listing.
“In residential focus groups, homebuyers are telling us that they prefer listings that offer 3D digital twins so that they can best understand the property,” he said. “Adding virtual reality to Matterport, you can take a virtual tour of the property with your virtual agent who will walk into the space with you.
Florance spent a few moments of the call focusing on buyer-broker commissions and reiterated Homes.com’s potential value when NAR’s settlement terms go into effect this summer. Florance said Homes.com will give buyers an avenue to directly connect with listing agents to view a home, bypassing the potential pressure to sign a representation agreement before they’re ready.
“Currently only 30 percent of buyer agents ever get a written agreement at any point in the transaction process,” he said. “Homes.com connects homebuyers directly with the listing agent, so they can arrange to see the house with no paperwork or commitments.”
“We are increasingly confident in our ability to build out the number one residential marketplace in terms of traffic revenue and profitability in the years ahead,” he added.
CoStar owns LoopNet, the website for commerical listings, as well asten-x.com/which is an online auction house for commercial properties. It won’t be long before they bring auctions to the residential market, will it?
