Happy Birthday Kayla!
She’s a New York girl now!
Market Improvement Coming
Oh you buyers are being very coy, aren’t you.
Go ahead – be very picky and patient these days about the homes for sale. Keep chuckling to yourself about how the inventory is fat and heavy with OPTs and prices seem to have nowhere to go but down.
Enjoy it while it lasts. It won’t be long.
Jerome Powell’s last day is May 15, 2026, and Trump will be riding him all the way to the end. The new Fed chief will be named in advance, and the bond market will probably get ahead of it too because Trump will be bellowing about how he can’t wait to drop rates back to 1%.
They don’t care about the amount of the federal debt amount – it’s the payments that are burdensome. Once the rates go down – boom, problem solved and Trump ends up being the hero who saved the federal budget.
And the housing market.
All we need is to get mortgage rates down into the 5s. Trump’s new guy should have those in place easily by the end of May, and – dare I say it – we could have mortgage rates between 4% to 5% as soon as next summer!! Wahoo!
There will still be a flood of inventory, but at least more buyers might step up.
Frenzy 2026, here we come!
Over List, June
The market may seem a little soft but 24% of the buyers are still paying over the list price. About half of those were under $2,000,000 which is understandable. If some segment of the market is still competitive enough to warrant an over-list offer, it would be the low-end.
Both the average and median sales prices were at their lowest ponts of 2025, plus the differences between the LP and the SP were the largest of the year too:
Inventory Watch
It looks like the inventory has finally peaked for 2025 – phew!
But it also means that there be fewer creampuffs – and more refreshed listings – coming to market the rest of the way. Think the inventory is stale now? It will most likely get worse.
Want to predict the future?
Look at the green line in the graph above. The pendings lagged a bit after Liberation Day, but bounced back in early May to pick up the pace again. If it weren’t for that blip, the pendings have mirrored the path from last year – and it will probably do the same the rest of the way.
Home sellers should get ‘er done now, rather than risk having to compete with a surge of inventory next year. In fact, I think we can re-define the selling season for the next few years.
Hot in January and February. Then sluggish the rest of the way as inventory loads up which causes the second half of the year to be particularly unnerving and less productive except for the sharks.
The Rest of 2025
Based on the current market conditions, it’s going to be a long cold winter.
I can go on and on about the sluggish market, but it doesn’t matter. Over the next three months, all that matters is whether sellers are motivated enough to move that they surrender. Give up the fight and cut a deal. Capitulate.
At least 3/4’s of them won’t.
Then once we get close to December, the remaining home sellers won’t feel as desperate because the joy and optimism of the new year will seem close enough that they will just wait – instead of giving their house away.
There will be buyers who cave and just pay the price because they’re tired of waiting. Or Trump could get lucky and Powell leaves early so a new Fed chief can get busy with getting mortgage rates back down to 3%. Trump should just offer Powell $100 million to leave.
Windansea History
https://macmedadestruction.com/history-and-timeline-of-la-jollas-windansea-shack
Top of the Hill
In the last five years, there have only been three sales of these older homes on Skyline Drive – and only one was on the west side of the street. The easterly view is a sleeper benefit too – enjoy terrific sunrises every day! The interior is original from 1956 (including the knotty-pine look) but the home needs to be rebuilt anyway so who cares:
Link to ListingRio Verde, AZ
Are you looking to retire in an area that has similar people around? This article said that 86.6% of the residents of Rio Verde are over the age of 65!
Here’s a local realtor talking about it:
There are 2,200 people in Rio Verde, and there are 124 homes for sale – with many of them priced under $1M:
Happy 4th, Mom
My mother was born on the Fourth of July – so this will be our first without her. It was a particularly tough month – not only did my mother pass away in early June, but Richard also lost his mom this past Monday.
We had my mom’s funeral service at St. Leo’s Church in Oakland, the same church where my parents were married and where my dad and grandparents also had their final mass. It’s the church we attended whenever we were in town, and after mass, the kids would always drag our parents over to Fenton’s Creamery for an ice cream. After my mom’s funeral service, we re-lived our past and went over for an ice cream again.
In her honor, I’m going to get an ice cream today too. I love you Mom!
Great-grandsons
Just Wait?
This agent is expressing the same thoughts being told to sellers all across the country today. The vast majority of realtors have only known a raging seller’s market over the last 15 years, and they don’t know any different.
But what if the buyers don’t come?
It’s why I’m certain that sales will start suffering long before anyone thinks about lowering their price. Hope the sellers don’t mind the wait and inconvenience.
Sellers deserve to know that it’s possible we’re at the all-time peak. As boomers age out, home pricing could start a slow, gradual decline – especially if we’re out of buyers willing to pay $2 million for a 30-yr old tract home in Carlsbad.
Because buyers are on their own now, they will probably just buck up eventually and pay the seller’s price – unless they wait long enough for more sellers to get antsy and one of them undercuts the existing unsolds to get out.
