RSF Fire
Back in the days when anyone could be a drone marauder I was active for a year or two and caught one fire incident in Rancho Santa Fe up close and personal:
Look Out World
The succession plan is underway!
We will be working around Natalie’s dance career for a while, but she has been doing a tremendous job of doing just that since she began as our full-time marketing director four years ago – she even squeezed in a world tour!
While the current outlook for new realtors is fairly bleak, if anyone can make it, she can! Go Natalie!
Inventory Watch
It’s looks like we dodged the 500 bullet – there were 496 active listings last week and it appeared we were heading for 510 or more by now. But instead, today’s count is 479 actives, and it’s doubtful there will be any big surge of new listings this late in the game.
The drop in the number of actives wasn’t because a bunch went into escrow.
There were only 37 new pendings, which is about average for a week. Another 28 withdrew or cancelled their listings, suggesting that the cancellation parade should start sooner this year due to the crickets heard wherever a home is just slightly overpriced. If you haven’t had any showings for weeks, it’s easy to blame “the market” and hang it up for now.
Don’t be surprised if we have a load of ‘new’ listings in 2025 – get in and out in the first quarter!
The pricing of the unsolds is following the same trends from last year:
On a side note, here’s a good article with specific examples of cash purchases in Manhattan:
Link to Free Article in the NYTHuge Property-Tax Windfalls
Twelve straight years of record-high revenues – hope you can get by on that! Not sure how that makes San Diego more affordable though. The new homeowners must feel like they are carrying an inordinate amount of the burden.
San Diego County’s tax-assessed property value reached a record high of $768 billion in 2024, $40.6 billion higher than last year, county Assessor Jordan Marks announced.
Marks said in a news release that the 2024 figure “reflected unprecedented property tax savings” of over $300 million for homeowners, charitable groups, disabled veterans, small businesses and affordable and homeless housing projects.
Marks added that the figure applies to over 500 residents affected by the severe winter storms in late January. This is the 12th straight year that the county Assessor’s Office has delivered “record-high revenue for key government services and record-high property tax savings, making San Diego more affordable to live and thrive,” Marks said.
According to the Assessor’s Office:
– with 1,017,929 parcels, San Diego County is the fifth-largest assessment jurisdiction in the United States;
– the county saw $32.2 million in property tax savings for 460,104 homeowners using the homeowners’ exemption;
– the highest assessed value growth rate was 7.46% in the city of San Marcos, while the lowest assessed rate was 3.33% in the city of El Cajon;
– the county saw $29.5 million in property tax savings for 17,763 disabled veterans/surviving spouses;
– the largest assessed value increase was $19.3 billion, and
– Proposition 13 protection applied to 91% (or 929,563 properties), limiting the tax increase to 2%.
Marks also credited department employees for their leadership in closing the tax roll on time.
“If we don’t close the tax roll on time, then county services will be interrupted, taxpayers impacted, and we would see a cascading effect that would impact revenues for public safety, schools, libraries, parks and other key government services,” he said.
https://thecoastnews.com/county-sees-record-high-of-768b-in-tax-assessed-property-value/
30A Florida
How about moving to the Florida panhandle around Highway 30A! Condos under $200,000!
Link to Zillow 30AWill Home Prices Drop?
Here are four tepid responses to the question on whether home prices will drop this summer:
https://www.cbsnews.com/news/will-home-prices-finally-drop-this-summer-heres-what-experts-say/
The lame last paragraph sums it up:
The bottom line
The real estate market seems unlikely to experience significant price decreases nationally this summer, but it’s possible that in specific local markets, there will be dips. Still, until conditions change, like with more housing inventory, it could be tough for prices to decrease. Even then, it could take time for pent-up demand to temper, but it’s possible that overall affordability at least increases, such as if mortgage rates drop.
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You can’t come to much of a conclusion about summer pricing in July, but let’s check the data! How we measure the pricing has been strong all year between La Jolla and Carlsbad:
The world is too crazy for something not to give. My opinion of the pricing trend above is that the higher-priced superior homes are gaining in market share (who wants to buy a dump in this environment?) and it’s providing a head-fake that disguises the truth.
What’s going to give is the number of sales – we may not see 152 monthly sales the rest of 2024.
The commission debacle will be discouraging to the marketplace, mortgage rates aren’t going down enough to make a difference, and the political firestorm will get worse. The only way a buyer will ignore all of that and keep buying is if they see the perfect home.
There will be some nice deals for those who are willing to dig them out.
But I think by the screwy ways we measure it, the NSDCC pricing will look fairly strong, but the best precursor of the future – the number of sales – will be dropping the rest of the year, which will create even more softness. Buyers won’t feel confident about the price they are paying unless they have some decent comps to rely on, and those will be few and far between.
Happy 90th Mom!
It’s my Mom’s 90th birthday today!
Mom and me
My Mom and Dad with Kayla – their first grandchild!
Sister Kathy, Brother Dave, Mom, Brother Charlie, me and Uncle Tom her brother
X – Fourth of July
Dave Alvin wrote this song and he’s on guitar and backup vocals here!
https://www.farmaid.org/donate/ways-you-can-support-farm-aid/
Historic Wealth Transfer
San Diego is already an affluent market, and with the extreme weather conditions now affecting the rest of the country year-round, we have to look like a fantastic upgrade to people who just came into some big money. From Leonard Steinberg, the Compass chief evangelist:
Over $82 TRILLION will transfer from older to younger generations in the US over the next twenty years…..that is over $4 trillion of stimulus per year, every year, for the next 20 years!
Over the next 10 years, 1.2 million people worth at least $5 million will transfer an estimated $31 trillion to their heirs and about two-thirds of that extraordinary amount of wealth – or $19.9 trillion – is forecast to be passed on by 2033 by about 155,000 individuals with a net worth of $30 million or more according to research firm Altrata. That is MULTIPLES of the amount of stimulus spent on ALL Americans during COVID that many attribute to spiking inflation…..concentrated in a much, much smaller group, mostly wealthier already.
Yes, luxury market pricing could grow well beyond our imagination.
What might this do to luxury real estate? It’s very possible that we’re about to enter an era of RUNAWAY Luxe-flation. The ability for markets to keep up the supply for this growing demand is almost certain to trigger massive price hikes. That $1,000 per night hotel room that is now $1,750 per night could easily go to $3,000. That $50 million Palm Beach mansion that now sells for $100 million could become a $250 million mansion. Yes, luxury and ultra luxury markets will see massive infusions of capital that may result in lowered buying power per dollar as prices soar.
If this capital infusion is not limited to luxury markets and spreads into other markets that simply cannot afford the higher prices, we may have a problem. Sadly, the pressures for less-wealthy people to squander their money on things that buy them perceived status keeps growing. If builders focus more on more profitable, more expensive properties, everyone else will suffer the consequences too.
The Decoupling Adjustment Period
We know that the current DOJ wants to de-couple commissions, and have buyers pay for their own help. How does Team Trump feel about real estate commissions? I checked with Project 2025:
Project 2025 proposes significant changes to the traditional real estate commission structure to promote more transparency and direct negotiations between consumers and real estate professionals. Currently, in many U.S. real estate transactions, the seller typically pays a combined commission of 5-6% of the sale price, which is split between the listing agent and the buyer’s agent. This conventional arrangement has been criticized for creating potential conflicts of interest and lack of transparency regarding the actual costs associated with buying a home.
The new guidelines suggested under Project 2025 aim to shift this dynamic. The recommendations encourage a system where buyers directly pay their agents, allowing for more transparent negotiation of services and fees. This change is expected to lead to a more competitive market for real estate services, where commission rates are negotiated separately and may potentially decrease as a result.
One significant component of these changes is the move away from blanket offers of cooperative compensation to buyer’s agents on multiple listing services (MLS). Instead, buyers will negotiate and pay their agents directly, fostering a clearer understanding of the costs involved in their transactions. This is anticipated to lead to a more consumer-friendly environment where buyers have greater control and can choose services that best fit their needs and budgets.
Geez…it sounds identical to the current DOJ solution! It will be the worst thing that ever happens to the real estate market, mostly because weaker agents will oblige.
To clear things up for consumers, we should change one word.
Real estate commissions are NOT negotiable. They are DIFFERENT!
Everyone (especially NAR) is pushing the catch phrase, Commissions Are Negotiable, so they don’t get sued any more. But that isn’t helping anyone. All it does is make the consumer think they just need to find an agent and then work them over for a lower commission rate.
But if we said, Commissions Are Different, then consumers would wonder what is different – and conduct an investigation among agents to determine the differences, and what is best for them. It’s what has been missing all along!
Instead, it will be about beating down agents on their pay, without realizing that an inferior experience will be the likely outcome.
How is the experiment going so far?
It is still legal to advertise seller-paid commissions in the MLS, but some think it’s a good time to try out the idea of offering little or no seller-paid commissions to the buyer-agent to save some money. Here are three active (unsold) listings that have been lingering:
True, there are also hundreds of unsold listings piling up that offer a 2.5% commission so it’s not just the discounters/experimenters who are having trouble with today’s market. We don’t know if it’s the lack of commission or the list price that is causing these not to sell, but after two months on the market, you can expect buyers will want concessions on one or both….or maybe they will just wait until next year.
With the market already stuttering a bit, sellers may want to consider getting it done now while they can still pay a commission to a buyer-agent. It will not be easier to sell during the ‘decoupling adjustment period’ that commences on August 17th. In fact, between the adjustment period and the political circus, the market will be in stallout mode for at least the last four months of this year.
Hopefully there will be an announcement any day about the brokerages suing NAR that might postpone the elimination of seller-paid commissions. Can we at least put it off until Spring, 2025 please?
