The squeeze is coming from several directions, and all are rooted in the fact that there isn’t enough business to go around. Thankfully, half of the realtors are of retirement age, and will drift away naturally.
The pending class-action lawsuits will likely de-couple the commissions, and sellers won’t be paying a bounty to buyer-agents like they have since the beginning of time. Agents who can justify their value and services can always contract with buyers, and we’ll see where that goes. But it won’t go very far.
There are also forces within the industry that are deliberately putting the squeeze on. Opendoor has developed a nice little package of exclusive listings presented to buyers at a 2% savings if they don’t mind just placing their order online:
Because the people who put this together have never been realtors, it never occurs to them that paying a buyer’s agent has value. Homebuyers who get good help are going to feel more comfortable paying more the home, and conversely, with no help, they will want to pay less to compensate.
Is the tease of a 2% discount enough? We will see. But it’s another example of the pressure to squeeze out the buyer-agents, and Opendoor thinks they are passing the savings along to the buyers. But does any seller want to have buyers floating around, hoping to figure out the buying details on their own and cope with buyer’s remorse? No! It’s why the I-Pay-One companies never last because they don’t get it – buyers need and want help.
Instead, what has developed during a raging seller’s market is the thought that eliminating buyer-agents is a good thing. The message is clear – we don’t respect what you do, we don’t think we need you, and we don’t care what you think about it.
Redfin has no respect either.
On homes that they own – and can pay any rate – they are down to 1.75%:
They are giving buyer-agents the double middle-finger salute, and they don’t care what you think about it. Another option would be for them to pay a healthy commission and earn some respect for themselves, but that doesn’t occur to them either.
It would be worth it to champion the value that buyer-agents bring to the table, but nobody appears interested in that angle. Instead, they think the cost-cutting somehow justifies it, without considering – if it results in buyers paying less, then did you get anywhere?
I mentioned the strategy we employed on Avenida Sierra.
After a low-priced new listing came on the market at $1,350,000 the day before we were going to launch, we lowered our list price from $1,595,000 to $1,395,000 to ensure that we were as attractive as any of the six competing listings (four of which had hit the market in the previous week).
Because the $1,350,000 was only seven doors up the street, we had to go head-to-head. You can’t just shrug it off – if we would have launched at $1,595,000, all we would have done is help them sell!
How did it turn out?
We received multiple offers, and I ran our sales price up to $1,550,000!
It is easier to go up on price, than down!
We are the only listing that has been marked pending too:
I raised the list price to reflect the sales price, and send a message to others that more is possible!
We knew at the beginning of June that we wouldn’t get to 200 sales, just by the number of pendings:
NSDCC June Listings and Sales
Year
# of Listings
# of Sales
L/S
2015
527
340
1.55
2016
513
312
1.64
2017
416
360
1.56
2018
476
299
1.59
2019
435
282
1.54
2020
448
274
1.64
2021
386
357
1.08
2022
301
170
1.77
Our precipitous drop in the number of listings has to be considered when examining the current market conditions – and not only are there fewer listings than ever, but the quality of the homes coming to market is on the lower end. People are hanging on to the best homes!
After rates and prices have doubled, if you are going to buy a home now, you want to hold out for a good one! Yet we have fewer quality choices than ever before.
More on one of the proposals to spend the state’s budget surplus. It doesn’t make the homes any cheaper, so home buying will still be limited to the affluent who can afford the payments:
First-time buyers often rely on family gifts to afford the down payments on their homes. Now California Legislators want the government to fill the role of generous relative.
Lawmakers are proposing creating a billion-dollar fund in this year’s state budget that would provide California’s first-time buyers either all of the money they need for a down payment, or very close to it, in exchange for partial ownership stakes in those residences.
Atkins said the California Dream for All program is aimed at creating opportunities for lower- and middle-income buyers in a rapidly rising market, including those who have faced racial and economic barriers to homeownership.
“The California Dream for All program will give more people the chance to break free from the cycle of renting,” Atkins said last month. “This has the ability to change people’s lives.”
The proposal is the subject of negotiations between the Legislature’s Democratic supermajority and Gov. Gavin Newsom, also a Democrat, on how to spend a projected budget surplus of $97.5 billion. The legislature passed a budget on Monday that includes the proposal, though negotiations with Newsom continue on a final overall spending plan.
A spokesman for the governor declined to comment on the proposal, citing the ongoing negotiations. It was not included in the governor’s original budget nor in his May revised budget.
The housing proposal – which would call for issuing revenue bonds of $1 billion a year for 10 years to create the fund — is the largest in a slew of proposals intended to promote homeownership this year. The proposal also includes $50 million in the budget this year, and $150 million per year after that to pay for the administrative costs of the program and the interest costs of the revenue bonds.
The program envisions helping some 7,700 borrowers a year, according to estimates made by the program’s designers based on home price projections. A start date for the proposed program has not been indicated.
You can still buy a Village Park home in the $800,000s! This one feels like a detached-home too, and is surrounded by greenbelts. One-story, new flooring and paint, private backyard, 2-car garage, air-conditioning, laundry room, plus the primary bedroom suite has a fantastic travertine shower and huge walk-in closet! A house across the street is listed for $1,900,000 – this is the right neighborhood! Walk to the Park Dale Lane Elementary School and the Village Park Recreation Club too – enjoy all the benefits of the Village Park clubhouse, pool/spa, & tennis courts in this dog-walker’s paradise with flowing green belts throughout the area. Wow!
My guess is we’ll be 400+ at the end of the year, or about the same as February. A flat-pricing environment is the easiest of all the choices for buyers and sellers – just sell for the same amount as the last guy.
San Diego Non-Seasonally-Adjusted CSI changes
Observation Month
SD CSI
M-o-M chg
Y-o-Y chg
Jan ’20
264.04
+0.2%
+5.1%
Feb
265.34
+0.5%
+4.6%
Mar
269.63
+1.6%
+5.2%
Apr
272.48
+1.1%
+5.8%
May
273.51
+0.4%
+5.2%
Jun
274.91
+0.5%
+5.0%
Jul
278.00
+1.1%
+5.4%
Aug
283.06
+1.8%
+7.6%
Sep
288.11
+1.8%
+9.4%
Oct
292.85
+1.6%
+11.5%
Nov
295.64
+1.0%
+12.3%
Dec
297.52
+0.6%
+13.0%
Jan ’21
301.72
+1.4%
+14.3%
Feb
310.62
+2.9%
+17.1%
Mar
320.81
+3.3%
+19.1%
Apr
331.47
+3.3%
+21.6%
May
341.05
+2.9%
+24.7%
Jun
349.78
+2.6%
+27.2%
Jul
355.33
+1.6%
+27.8%
Aug
357.11
+0.5%
+26.2%
Sep
359.88
+0.8%
+24.9%
Oct
363.80
+1.1%
+24.2%
Nov
367.62
+1.1%
+24.3%
Dec
374.48
+1.8%
+25.9%
Jan ’22
383.92
+2.5%
+27.2%
Feb
401.45
+4.6%
+29.2%
Mar
416.64
+3.8%
+29.9%
Apr
426.08
+2.3%
+28.5%
Home price increases slowed ever so slightly in April, but it is the first potential sign of a cooling in prices.
Prices rose 20.4% nationally in April compared with the same month a year ago, according to the S&P CoreLogic Case-Shiller Index. In March, home prices grew 20.6%. The last slight deceleration was in November of last year.
The 10-city composite annual increase was 19.7%, up from 19.5% in March. The 20-city composite posted a 21.2% annual gain, up from 21.1% in the previous month.
In a change from the last five months, when most of the 20 cities saw month-to-month price gains, only nine cities saw prices rise faster in April than they had done in March. Cities in the South continued to see the strongest monthly gains, including Charlotte, North Carolina; Tampa, Florida; Atlanta, Dallas and Miami.
“April 2022 showed initial (although inconsistent) signs of a deceleration in the growth rate of U.S. home prices,” Craig Lazzara, managing director at S&P DJI, wrote in a release. “We continue to observe very broad strength in the housing market, as all 20 cities notched double-digit price increases for the 12 months ended in April. April’s price increase ranked in the top quintile of historical experience for every city, and in the top decile for 19 of them.”
Tampa, Miami and Phoenix continued to lead the pack with the strongest price gains. Tampa home prices were up, with a stunning 35.8% year-over-year price increase, followed by Miami, with a 33.3% increase, and Phoenix, with a 31.3% increase. Nine of the 20 cities reported higher price increases in the year ending April 2022 versus the year ending March 2022.
Cities with the smallest gains, although still in double digits, were Minneapolis, Washington and Chicago.
Not only are these price gains for April, but the index is a three-month moving average. The average rate on the 30-year fixed mortgage just crossed the 5% mark in April after rising from around 3% in January. By June it had crossed 6%.
“We noted last month that mortgage financing has become more expensive as the Federal Reserve ratchets up interest rates, a process that had only just begun when April data were gathered,” said Lazzara. “A more challenging macroeconomic environment may not support extraordinary home price growth for much longer.”
The housing market is already cooling, with slower sales and reports of price drops among some sellers. The supply of homes for sale has also increased steadily, as more listings come on the market and homes already on it sit longer. Active inventory last week was 21% higher than it was the same week one year ago, according to Realtor.com.
“For buyers and sellers, the road ahead will require more flexibility in pricing, brushing up on negotiation skills, and acknowledging that market conditions today are different than even six months ago,” said George Ratiu, senior economist at Realtor.com.
Huge turnout for my open house – more than 70 people!
There were four open houses in the neighborhood each day, so the buyers were able to make plenty of comparisons. My guess? The two homes offering the best values will sell this week!
My new listing at 3534 Avenida Sierra, priced at $1,395,000, is one of six for sale in Lomas Serenas – four of which have listed in the last week. When you have a competition like this, you want to be the first one to sell and avoid a potential price war which could erupt in 30-60 days if the market doesn’t respond.
When evaluating how much to pay for a home today, I made the case with buyers that logically I’d like use the original list prices of comps . Those listing agents of recent sales nearby have probably used the over-bid prices of comparable sales, but at least those were from closings as far back as last summer. I also throw out any of the sales of homes sold off-market, because those resulting prices were never tested on the open market (and probably had some extra $$ added to incentivize the seller to not go on the open market).
How about with sellers?
What are the possible pricing strategies of a new listing in the post-frenzy aftermath?
Use the recent sales prices nearby, even the ones that were bid up 10% to 20%.
Take a little off the radically bid-up comps.
Use the original list prices.
Here is a simple comparison of how myself and another agent priced similar homes this week.
This is the most recent sale in the tract. It listed on April 4th for $1,300,000, and was bid up to $1,750,000:
I thought my new listing was very comparable, but we are past the hottest frenzy conditions and there were other comps that were lower. It didn’t seem realistic that we could get the full $1,750,000, so my recommended list price was $1,595,000. At least I could tell buyers that they were paying under the latest comp, and because my listing has the most-popular features – fully remodeled one-story on a low-maintenance half-acre lot, 3-car garage, private pool/spa, hardwoods, etc. – we would have mass appeal.
But then on Thursday, this house listed for $1,350,000 and it’s only seven doors up the street from my new listing – and listed by the same agents who sold Vista Rocosa for $1,750,000:
While my listing is in better condition, it is smaller and only has 3 bedrooms, instead of four. I couldn’t ignore the new listing and just go on the open market at $1,595,000, because all that would do is help sell the competing listing – and then that would end up being the latest comp anyway.
I had to have the tough conversation with my sellers.
They agreed to lower our price to $1,395,000, and compete head-to-head with the other active listing:
Trustindex verifies that the original source of the review is Google.
Jim & Donna Klinge helped us sell our home of 30 years in Ocean Hills. We were very happy with their service and would HIGHLY recommend them to anyone looking for an Honest, Knowledgeable, Skilled, Informed Efficient realty team. Both Jim & Donna were so helpful in different ways and complemented each others skills. Please refer to a more detailed review that we wrote on YELP. Thank You Both for all your help!!!
Jesse O'Hara
June 12, 2025
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A+ thank you
Lisa Tuomi
June 11, 2025
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Many years ago, we purchased a home in Carlsbad, using a realtor that was recommended to us - Jim Klinge. Fast forward to 2025, we recently had the privilege of selling 2 homes in Carlsbad, CA and didn't hesitate to reach out to Jim and Donna Klinge of Klinge Realty Group to guide us through the sales. The transactions were very different, each with its own unique situation, opportunities and challenges. From start to finish, Donna and Jim helped navigate the pre-sale preparation, the listing, showing of the house, buyer negotiations, the final close and all of the paperwork and decisions in between. What stands out with both transactions is the professionalism of Jim and Donna (and their team), wonderful communication (timely, relevant, concise), their deep understanding of market dynamics (setting realistic expectations), their access to top-notch contractors, and last, their ability to guide us across the finish line successfully. We wouldn't hesitate to use Jim and Donna in the future and highly recommend them for anyone looking to buy or sell a property in North San Diego County.
Jerry Meyer
March 28, 2025
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We sold a home with Jim and Donna and from beginning to end they were consummate professionals. Their initial walk through the property resulted in a list of items to be repaired or updated. They supplied a list of vendors and job quotes to do the repairs and updates. We originally wanted to sell ‘as is’ and just get it over with. They gave us a selling price for ‘as is’ and options for doing a few updates/repairs to doing it all with the selling price for each option. We agreed to do all they suggested and we sold for the exact price they predicted. For every dollar spent we got back more than $2 back in the selling price. And they got that price in a rising interest rate environment! Donna and Jim are extremely detailed and guide you through ever aspect of the sale. There were no surprises thanks to their guidance. We couldn’t be more pleased with their representation.
Thank you Donna and Jim,
Jerry and Mary
Heather Quejada
March 27, 2025
Trustindex verifies that the original source of the review is Google.
We have known Jim & Donna Klinge for over a dozen years, having met them in Carlsbad where our children went to the same school. As long time North County residents, it was a no- brainer for us to have the Klinges be our eyes and ears for San Diego real estate in general and North County in particular. As my military career caused our family to move all over the country and overseas to Asia, Europe and the Pacific, we trusted Jim and Donna to help keep our house in Carlsbad rented with reliable and respectful tenants for over 10 years.
Naturally, when the time came to sell our beloved Carlsbad home to pursue a rural lifestyle in retirement out of California, we could think of no better team to represent us than Jim and Donna. They immediately went to work to update our house built in 2004 to current-day standards and trends — in 2 short months they transformed it into a literal modern-day masterpiece. We trusted their judgement implicitly and followed 100% of their recommended changes. When our house finally came on the market, there was a blizzard of serious interest, we had multiple offers by the third day and it sold in just 5 days after a frenzied bidding war for 20% above our asking price! The investment we made in upgrades recommended by Jim and Donna yielded a 4-fold return, in the process setting a new high water mark for a house sold in our community.
In our view, there are no better real estate professionals in all of San Diego than Jim and Donna Klinge. Buying or selling, you must run and beg Jim and Donna Klinge to represent you! Our family will never forget Jim, Donna, and their whole team at Compass — we are forever grateful to them.
Lou F
March 27, 2025
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WeI had the pleasure of working with Klinge Realty Group to sell our home in Carmel Valley, and I cannot recommend them highly enough!
Jim and Donna demonstrated exceptional professionalism, offering expert guidance on market conditions and pricing strategy, which resulted in a quick and successful sale.
Communication was prompt and we were well-informed throughout the entire process.
For anyone looking for a dedicated and knowledgeable real estate team, look no further!
---
William Sams
March 25, 2025
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Donna and Jim Klinge of Klinge Realty Group have our highest possible recommendation. From Donna and Jim’s first visit to our house through closing their advice and counsel was candid and honest in all dealings. They kept us fully informed throughout the process. The house sold less than three days after listing with a two-week closing. My wife and I have sold several houses during our lives. This was by far the best experience. Klinge Reality is a premium service realtor. You can’t make a better choice for someone to sell your home fast and for top dollar.
Emily Hernandez
December 29, 2024
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Donna and Jim provided exceptional support and professionalism throughout the entire process. We couldn't have been happier with their efforts. They made our house shine, and thanks to their expertise, it sold above the listing price in the very first weekend! Truly a fantastic experience from start to finish.
Jesus Adrian Sahagun
November 11, 2024
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This year has been difficult on our family, mainly due to having to sell our home. Thankfully we knew God had a plan for us and working with the Klinge team was a key part of it. It was an obvious decision to work with them again after such an amazing experience when purchasing the same home we needed to sell. The challenge was, how will we do this in so little time with so much going on? Jim and Donna held our hand every step of the way. Whenever an unexpected issue arose they found and provided a solution. Never once did we feel pressured to make a decision and the Klinges were always reassuring after providing the information that the decision was ours to make. Despite the curve balls, they never panicked and exemplified the “can do” attitude, making us feel optimistic and taken care of. Their expertise and professionalism was superb. But of all the reasons to work with the Klinges, the most impactful and valuable is their compassion and genuine care for their clients. We pray that we can one day purchase our forever home and you better believe that Jim and Donna will be representing us - as long as they will have us of course. Thank you again Klinge team! Your execution, experience, and care are unmatched.
SABIHA PASHA
July 23, 2024
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Jim and Donna were fantastic! Jim understanding my needs, recommending potential places, pointing out the pros and cons of each property was invaluable. Then when the offer was accepted Donna’s organized guidance through the inspections, paperwork etc made the whole process seem effortless.
So grateful that I had them on my side!
