May 2012 – San Diego Real Estate Market Reports

Greetings from The Taylors,

Most of you who know us realize that we are not the ones to constantly tout that the market has turned around and prices are on the upswing.  We continually advise our clients that the future of the market is unknown.  We do feel that the pace of decline is slowing and may begin to trend up sometime soon, but we still have not declared that the bottom has passed.  Each year we have a “Spring Time” bump in the market and this year is no exception.  Currently there is a trend of slight price increase, coupled with the severely reduced number of homes for sale and the continually low finance rates; it appears that we have turned the corner.  At least, that is what the news is saying.

Our advice is that you buy or sell based on your needs and not because you are attempting to “Time” the market.  Over the long term you will be much happier because you will get to live in and enjoy the home you really want.

Just today one of our clients paid us a big compliment.  The client said “You understand what customers want and move forward solidly”.  We hope that this is what all of our clients believe of us.  The greatest compliment that one can receive is the trust and confidence of their clients.

Here are this month’s San Diego Real Estate Market Reports:

HomeDex Report

San Diego Area Market Trends

HomeDex Annual Report

We want to make sure that we never fail to ask for your business.  We have the ability to help anyone no matter where they may need help.  We can represent buyers or sellers in both Residential and Commercial Real Estate.  Please remember that Prudential California Realty has world wide connections and we are always here to help.  We also welcome your referrals so please do provide our information or forward this message to anyone you like.

Thanks again for your continued support,

Janet & Nick Taylor

The Taylors

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As of May 1st we are seeing mutliple bidding wars on homes. The inventory is limited at this time. Will we see another run away real estate market with sales over the asking price going forward?

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The TBWS Daily show recently produced this video regarding the number of foreclosures on the horizon.  For the past several years the nomber of foreclosures coming to the 'For Sale' market has been very limited.  As the state in this video, since the beginning of the current downturn, we have had about 4,000,000 foreclosures nationwide.  In this video they predict that we could be looking at an additional 8,000,000 foreclosures during the next few years. 
As a buyer, this could mean that prices could remain at the current level or decline slightly.  As a seller, this means that prices could remain at the current level or decline slightly.   As I see it, we are in a market that will not experience a tremendous amount of price adjustment to either the upside or downside.  So, if you are waiting for prices to go up or go down, that probably will not happen very soon. 
With interest rates at such low levels, we may someday discover that this was the absolute best time to either buy or sell a home.

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In this video, George Chamberlain, Executive Editor of the San Diego Daily Transcript, interviews the President of the San Diego Association of Realtors.  As you will see in this video, the market is strong.  Prices are firming, sales volume is up, and most of all the number of homes for sale has declined sharply.  This video is called 'The Scoop' and is a service of the S.D.A.R.

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Each month Prudential California Realty publishes Market Trend Reports for San Diego.  We find that both people considering the purchase of a home and likewise those considering listing their home for sale, want information that they can use to help make the buying or selling decisions.  This is a good source of information regarding trends in the Real Estate market.  This report is also provided for the upscale market.

Click here to view the April San Diego Market Trend Reports 

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Are we finaly in a 'Real Estate Martket' where it makes sense to just 'DIVE IN'?  

For what has now become at least a 5 year period of waiting for some people, it may be that perfect time to just go ahead and buy that home you have been waiting for.  In this video, Stan Humphries, Zillow Chief Enonomist, predicts that prices will continue to decline very modestly through out 2012 and then stabilize in 2013.  Looking forward, the prediction is that in 2014 and 2015 the prices will remain flat or possibly tick up slightly.  And then in 2016 we will begin to see a normal but somewhat modest rate of increase in the 3% to 5% range.

Depending upon what you believe to be the situation with home loan interest rates, this may be the year to buy......

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Should you Rent or Buy?

A few minutes ago I sent this Rent vs. Buy presentation to a client who is relocating to North San Diego County.  I think that this is a presentation that bears consideration.  I certainly welcome different points of view, so please tear this thing apart.  Remember, I already said that “Cash Flow” in not a factor in this presentation.

A few weeks ago I was holding an open house at which I met a couple of Physicians.  They were coming to this area and were going to be here for only three years.  When I asked why they were not going to just rent their reply really made me think.  The said that they could rent for about $3000/month or buy a similar home for about $500,000.00.  In the three years that they were going to be in the area they figured that they would pay out $108,000.00 in rent.  The way they looked at is was that if they bought for $500,000.00 they would put $100,000.00 down and have a monthly payment of around $2600.00.  At the end of the three year period they would sell and probably get most of their initial purchase price back.  (We have to remember that CASH flow is not a factor in their argument).

The formula that they used for the return of their initial purchase price went something like this.  If they were able to sell for the same price that they paid, then after paying all of the costs to sell they would wind up with about $462,500.00.  They used 7.5% as an estimate of what their costs to sell would be.  Then if they applied the savings in income tax, things like the interest deduction, property tax deduction, depreciation of the portion of the home used for business, etc.  Their cost of owner ship would be even less.  When I presented the argument that interest is a tax deduction vs. tax credit and that their tax savings would be their effective tax rate as it applies to their interest expense their response was that if they pay 4.0% interest their total expense would be around $42,000.00 over the three years, maybe less.  Their effective tax rate is 35% so they save $14,700.00 on Federal Income Tax plus what they save on their state taxes.  The same theory would apply to the Property Tax expense.  

Anyhow to make a long story short, these folks figured that if they sell the home for exactly what they paid ($500,000.00) they would loose $37,500.00 in sales costs, $27,300.00 in interest after the federal tax formula is applies, and $10,725 in property tax (again after application of the federal tax formula).  There for they feel that after adding up all of the after tax expenses they would spend about $75,525 as a true cost of ownership versus $108,000 actual cost of renting. They also figured that if the prices were to drop an additional 5% during the time that they own the home they would loose an additional $25,000.00 and still they would break even.

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The 2011 HomeDex Annual Report was just released this week.  We always look forward to this annual edition as it reflects the entire year as opposed to the month over month reports.  Because the entire year's sales volume is used, there is a more accurate portrayal of what took place in the Real Estate market during the past year. 

It is pretty easy to be a 'Monday morning quarterback' when we read this sort of report, the real challenge is to firgure out what will happen to the market in the months or even the years to come.  The fun thing about all of this is that even when we are in the middle of the heat of the market we usually do not know what really happened until about three months have passed.

Here are a couple of high lights from this years annual report:

The median price for a North San Diego County single-family detached homes sold in 2011 was $430,000.  The represents a 6.52% decline from the 2010 price, which was $460,000.  The 2010 price of $460,000 was up $50,000 from the 2009 price of $410,000.  And, the 2009 price was down 9.69% from the 2008 price of $454,000.

Even more interesting is that Fallbrook (92028 zip code), Oceanside (92054 zip code), Rancho Santa Fe (92067 zip code), Solana Beach (92075 zip code), and Carmel Valley (92130 zip code); all showed an increase in the median price over 2010.

The median priced single-family attached home in North San Diego County dropped 4.13% to $232,000 from $242,000 in 2010.

HomeDex is provided by the North San Diego County Association of Realtors

Click on this link to view the entire report.   2011 HomeDex Annual Report

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Traditional Sale and No Mello Roos! This spectacular home offers 5 Bedrooms, 4 Full Baths, with a bed/bath on the main level, and a 3 car garage. Spacious master suite with a retreat room, master bath suite, dual vanity sinks, large tub and oversized walk-in shower. Enjoy the deck off the master suite and ocean view. This is a chef's dream for entertaining indoors and out. GE Monogram Stainless Steel applicances and a lush landscaped back yard with Built-in BBQ and firepit. Partial ocean views. - San Diego MLS# 120006936, $759,000.00, Call Nick or Janet Taylor 760-707-9291 or 760-710-7234 to learn more about this home.

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December 27, 2011 |  8:11 am

Home prices in the nation’s largest cities fell in October for the second straight month, continuing to dash hopes that the sluggish housing market is headed for an upturn.

The Standard & Poor's/Case-Shiller index, a measure closely followed by economists, showed price drops in 19 of 20 cities since September. Overall, prices slipped 1.2% month-over-month and fell 3.4% compared with October 2010.

The decline is typical of the season, when home buyers back off after the busy summer period. But coming off of five straight months of increases, the retreating prices in the fall suggest that weakness in the market may stretch into 2012.

Atlanta was on particularly shaky ground, according to the index. Prices there declined 5% in October after falling 5.9% in September and were down 11.7% over the last 12 months. Atlanta, along with Cleveland, Detroit and Las Vegas, had average prices that were lower than they were in January 2000.

In Los Angeles prices were down 1.5% in October after sliding 0.8% the month before. Year over year, L.A. prices are down 4.9%.

The Case-Shiller data cast a pall on recent, more promising market feedback. Last week, the Commerce Department said construction of new homes and apartments was up 9.3% last month from October and up 20.1% compared wikth November 2010.

Sales in California were up 4% last month compared with the same period a year earlier, though they fell 4.2% from October, according to real estate research firm DataQuick. The median home price in the state was $244,000, down 4.3% from a year earlier but up 1.7% from October, the report found.

original link: http://latimesblogs.latimes.com/money_co/2011/12/home-prices-fall-in-october-says-case-shiller-report.html 

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Carlsbad Investor Scammed out of $250,000

The investor was a victim of two Oceanside men who were both sentenced to prison today.

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Before you read this article. One of the top spots is California. However, do not expect to buy a home as the picture shows next to the ocean for under $300,000. Very misleading. The good news is you can buy a home that size for $300,000 +/-. Southern California is experiencing some tremendous buys for $300,000 or less for first time home owners and investors. Homes in the $1M+ range in certain areas are experiencing out of state and international buyers taking advantage of the buys. Don't wait, give us a call to help with your real estate needs. 

10 U.S. hotspots for smallest house sizes

By Inman News
Inman News™

Six of the 10 U.S. areas with the smallest homes are in the Midwest, based on the median square footage of homes for sale on Realtor.com in September.

Realtor.com reported that the median size of homes for sale in Washington, D.C., was the smallest in the country that month, at 1,000 square feet. The nation's capital was also the only area to post a median two bedrooms for the typical home -- every state in the top 10 posted a median three bedrooms.

The six Midwestern states among the top 10 with the smallest homes are: Michigan, Iowa, Ohio, Illinois, Missouri and Wisconsin. Two of the states are in the West: Hawaii and California. One Northeast state is on the top 10 list: Maine. Washington, D.C., is the only area in the South to make the list.

The two areas at the top of the list -- Washington, D.C., and Hawaii -- also had the highest median list prices of the bunch: at $432,500 and $575,000, respectively.

The two areas varied widely in lot sizes. While Washington, D.C., had the smallest median lot size among the top 10, at 2,375 square feet, Hawaii's median lot size in September was 21,778 square feet. Maine had the biggest lot size among the top 10, at 44,431 square feet, followed by Wisconsin at 30,000 square feet.

Michigan had the lowest median list price among the 10, at $118,900. The median price data reflects all for-sale property listings on Realtor.com, including land, single-family homes, condos and co-ops. (View the full list of median house sizes for all 50 states and Washington, D.C.)

State: California

Beach house along California's coast. Sahani Photography/Shutterstock

Original URL: http://lowes.inman.com/newsletter/2011/11/10/news/160671 

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NEW YORK, Nov. 9, 2011 /PRNewswire via COMTEX/ -- Excluding their current state, if Americans had to say where they would most like to live, the top three mentions are states typically associated with sunshine and the beach: Hawaii (1), California (2) and Florida (3). These states have consistently been in the top 3 the last 8 times this question has been asked. However, this year marks the first time since 2001 that California has not been the top mention.

 

 

These are some of the results of The Harris Poll of 2,463 adults surveyed online between October 10 and 17, 2011 by Harris Interactive.

Rounding out the top 5 this year is Texas (4) and Colorado (5). Texas saw a nice jump this year, up to 4 from 8 last year, while Colorado dropped from 4 last year, to 5 this year.

The remaining 10 states on the list cover every geographic region of the country:

In the Pacific Northwest Oregon (7) and Washington (9) are Top 10 mentions;

The Southwest is represented with Arizona (8);

Nevada (14) makes the Top 15 for the West;

Montana represents the Midwest (13);

New York does so for the Northeast (11); and,

Virginia, Tennessee and South Carolina all come through for the South (10, 12 and 15, respectively).

Favorite Cities

In terms of cities Americans would most like to live in, the Top 15 mentions cover a wide range of geographical areas and climates this year as well. Unchanged since 1999, New York is the most frequently mentioned city that Americans would like to live in, followed by San Diego, which remains in the 2nd position, consistent with last year. The third top mention this year is Seattle, which seems to be steadily climbing, up from 4 last year and 5 the previous year. Similarly to the jump Texas made as a desirable state to live in this year (to 4 from 8 last year), its city of Dallas also made an impressive showing this year, coming in as the 4th most popular city. This is particularly notable because Dallas was not in the Top 15 last year at all, and only at number 10 the prior year. The countless entertainment and culinary options may be what appeals to some about Las Vegas, which is the 5th top city mentioned this year, followed on the list by San Francisco (=6) and Boston (=6), Chicago (8), Honolulu (9) and Denver (10). The Top 15 this year are rounded out with Nashville (11), Orlando (12), Los Angeles and Portland (tied for 13) and then two southern cities--on opposite sides of the country--are tied for 15: Atlanta and Phoenix .

Least Favorite Cities

While fantasizing about where you would most like to live can be fun, it can be equally fun to think about where you might least like to live. Thinking about these places can make a harsh Northeast winter or a sweltering Southern summer seem not as bad, depending on your geographic woes. Although New York has been the top favorite city for some time, it's also an extremely unappealing place for many people and it comes in, similarly to last year, as the least favorite city to live in. Despite reports of a rebirth, comeback and major gentrification efforts, Detroit remains as the 2nd least popular city, followed by Los Angeles (3), Washington D.C. (4) and Chicago (5). While some people are feeling excited about Texas, many are not as Dallas and Houston come in at 6 and 7 on the least favorite city list respectively. Further down the least favorite city list is New Orleans (8) and Miami (9), followed by four polarizing cities, which appear on both the favorite and least favorite lists: San Francisco (=10 least favorite), Last Vegas (=10), Atlanta (12) and Phoenix (13). Tied for 14 on the least favorite list are Cleveland, OH and Newark, NJ.

So What?

While sun-belt states have traditionally dominated the Favorite State list, this year with the inclusion of Washington, Oregon, Montana and New York in the Top 15, the list seems more diverse. And, looking at the Least Favorite City list, where 8 of the top 15 also appear on the most Favorite City list, it's clear what appeals to some definitely does not appeal to all.

Original URL: http://www.marketwatch.com/story/3-sunny-states-remain-top-choices-for-where-americans-would-like-to-live-2011-11-09

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ActivCare® at Bressi Ranch Serves Individuals with Alzheimer's and Related Dementia
http://www.sacbee.com/2011/11/01/4021965/residential-community-exclusively.html

Let The Taylors know if we may be of help selling your loved ones homes. This new facility will most likely fill up fast. Located in a wonderful community of Bressi Ranch, Carlsbad, CA 92009.

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By Les Christie October 24, 2011: 6:05 PM ET

NEW YORK (CNNMoney) -- In the latest attempt to address the ailinghousing market, the government on Monday announced changes to a federal program that will make it easier for struggling homeowners to refinance to today's near-record low rates. 

Under the new program, homeowners who owe more on their homes than they are worth will be able to refinance no matter how much they are underwater, as long as they are current on their payments.

More than 1 million homeowners could get cheaper mortgages as a result, officials estimated.

The revamped Home Affordable Refinance Program (HARP) will also streamline the refinancing process, doing away with certain types of appraisals and underwriting requirements, and reducing or eliminating fees that prevented homeowners from refinancing in the past.

More than 890,000 homeowners have already refinanced under HARP, which is available to borrowers with loans backed by Fannie Mae and Freddie Mac originated before May 31, 2009.

But hundreds of thousands more could not qualify -- mainly because of the previous 125% loan-to-value limit on the program or because banks would not take on the risk.

The 4% mortgage -- good luck getting one

"We know there are many homeowners who are eligible to refinance under HARP and those are the borrowers we want to reach," said Edward DeMarco, acting director for the Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac.

Currently, about 11 million borrowers are underwater on their mortgages, with about 4.7 million of those loans meeting or exceeding the 125% loan-to-value limit, according to CoreLogic, a financial analytics company.

By the time HARP expires in 2013, the federal housing agency estimates, up to 1 million more borrowers may benefit from the new regulations.

Many of those borrowers will be from states like Florida, California, Nevada and Arizona where home values have been hit the hardest. In metro areas like Las Vegas, for example, prices have plunged nearly 60% from their early-2006 peak.

The new rules and other details have yet to be finalized, but FHFA said that should all be worked out by Nov. 15. Banks may be able to start issuing refinanced loans by Dec. 1.

Lifting the loan-to-value restrictions may still only help a limited number of borrowers, according to Jaret Seiberg, an analyst for MF Global Inc.'s Washington Research Group, which analyzes public policy for institutional investors.

The problem: Mortgage holders still must be current on their payments for the past six months -- with no more than one missed payment in the past 12 months --and they also must be able to qualify for a new loan.

However, Seiberg believes, the changes should allow banks to refinance loans without worrying that Fannie Mae (FNMA, Fortune 500) and Freddie Mac (FMCC, Fortune 500) will force them to repurchase the loans if the borrower defaults.

In the past, banks have been reluctant to refinance loans because they didn't want to take on that liability, explained Shaun Donovan, the secretary of the U.S. Department of Housing and Urban Development. By doing away with that liability, more lenders will compete to refinance the loans, which he believes will make them more affordable for borrowers.

That should help remove one of the biggest barriers to refinancing through HARP, said Gene Sperling, director of the National Economic Council.

What about us? Responsible homeowners get left out in the cold

Under the newly-revamped program, Fannie and Freddie will also reduce the fees they have charged in the past in order to enable borrowers to better afford the new loans.

Among the fees that may be reduced or eliminated are those for loan level price adjustments. Going forward, borrowers may not be penalized for less-than-perfect credit scores, for example.

Fees will also be waived for some underwater borrowers who refinance into 20-year or other, shorter-term loans. By doing so, it could help homeowners get above water faster.

A homeowner who has a $200,000 balance on a 30-year mortgage with a 6.5% rate and a home value of $160,000, for example, currently makes payments of $1,264 a month.

If they refinance into a 20-year fixed-rate loan at 4.25%, it will reduce monthly payments to $1,238 and slash the balance to $160,000 in just five-and-a-half years. If they refinance to a 30-year loan at 4.5%, however, their monthly payments will be much lower, $1,038, but it will take 10 years to reach $160,000.

"It's an opportunity for borrowers to improve their household balance sheets by repaying their mortgages much quicker," said DeMarco. 

Original URL: http://money.cnn.com/2011/10/24/real_estate/housing_refinance/index.htm?hpt=hp_t2 

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Watch this video about informative information on San Diego Real Estate

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Traditional_SD_Market_Report.pdf Download this file

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