May 2020 housing charts

Submitted by Rich Toscano on June 22, 2020 - 9:12pm

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Submitted by sdrealtor on August 4, 2020 - 4:18pm.

Also want to clarify one other thing after hearing from a client. What i am reporting on are detached homes in a mid high end to high end market. The attached market is quite different around me and presents lots of great opportunities to live in nice newer homes at far more affordable prices enjoying the same schools, amenities and overall quality of life. Its mostly the detached home market that is soaring out of reach for most and that is what I am reporting on now. Ultimately I believe that will impact the attached market more but for now its still attainable for most.

Submitted by Coronita on August 4, 2020 - 5:48pm.

sdrealtor wrote:
Update time!

Aaahhhh Summer! Late July/Early August...traditionally one of the sleepiest markets each year. Time to sneak in one last vacation before the kids head back to school. What no vacations? Kids not going back to school? So whats that done to the market????? Kabooooommm!!!

New listings back to 31 which is 10 more than last weeks low number but very much in line with what we have been seeing since mid-June.

Pendings? Up by 20! Easily the highest count of the year. Must be those young families rushing to get settled before end of Summer? NOPE 36 were priced $1.25M or higher! 40% were over $1.5M and the strength continues all the way up the price spectrum.

Net-net an astounding loss of -24 homes of inventory on the market. That makes ten consecutive weeks of falling inventory around my 3 zips.

Just to reset this data is for Encinitas 92024 and S Carlsbad 92009/92011. On average there were 2 houses that went pending every day between $1.5M and $2M and 1 house each day over $2M. This is unbeleivable strength and lest you think it is purely low interest rate driven? My clients closed a jumbo loan last week they were well qualified for and it was brutally tough underwriting for rates not near the low conventional numbers we are seeing. There has gotten be some serious cash changing hands in this market.

Which brings us to serious cash locally. Last week after having been pretty range bound between $50 and $80/share for the last decade our largest private sector employer QCOM's approx 13,000 San Diego employees are sitting at $110/share with analyst price targets as high as $140.

I remember arguing with old timers 10 years ago that SD had fundamentally changed. They would roll out the "its never different this time" tropes. Well they are all gone now and SD has fundamentally changed economically. Its no longer a sleepy beach town over reliant on the military and tourism as it was 20 years ago. Its an economy driven by high tech, life/health sciences with military tech on top of military personel and tourism. The shift to working from home will only drive others to relocate here for its quality of life vis a vis other high end job markets.

Need more proof? This is being built in Encinitas.

This is not a resort for millionaires its a resort for those with eight, nine and even ten figures net worths. Thats billionaires folks. Rooms at this brands other hotels around the world start around $2000 a night. Dont know that they will go that high here but I would not expect to see average nightly rates below $1,000.

I said it before 10 years ago and I'll say it again. This place I call home is changing and changing fast. It feels like we are taking the next leg up with a new floor being laid. Now dont get me wrong, there are always cycles with bumps in the road. Prices could and should swing back down a bit at some point but my feeling long term remains. We've taken another step up the high end market ladder in the US and in the World.

Oh yeah, just to be complete. Closed sales up to 36 which is 5 more than last week and at the highest levels this year. Price reductions less frequent with sellers digging their heels in and often being rewarded for it.

In my zip (92009) there are 37 actives and 79 pendings so well under a 1/2 month inventory. End of the month last week so we had lots go from pending to sold so total pendings not up that much.

This market has been chewing bubblegum and kicking ass but it just ran out of bubble gum. Who knows what is next? Until next week....

In Qualcomm, AMD, Tim Apple, Microsoft, Pfizer, Moderna,UPS, FedEx, Costco we trust.... I think I missed a few others that blew numbers out of the water and are all at 52 week highs despite the covid recession that everyone predicted....:)

This has been an insane month for tech and biotech earnings....Cha-ching

Submitted by sdrealtor on August 4, 2020 - 10:13pm.

For RE around here also. I know not everywhere in SD is like here nor is attached or urban real estate as hot as detached and suburban. But to some degree we are interconnected over the long term and I just view the changes here as an indicator of what is going on +/- a bit around SD County

Still open to adding another area to follow if anyone would like to suggest one as a good belleweather

Submitted by Andrew32 on August 4, 2020 - 10:42pm.

On the flip side, any noticeable fall out from the 700+ jobs Intuit cut a little over a month ago? I heard engineering jobs were a good portion of that cut and I imagine some of those employees live along the 56 neighborhoods.

Submitted by sdrealtor on August 5, 2020 - 9:53am.

Good question and I havent seen it yet. Having recently had a client who bought in that area I have a firm grasp of what is going on there and wrote about it upthread. 4S Ranch couldnt be hotter, Del Sur is very strong and Torrey Highlands is blazing with little to nothing coming on the market the last few months. I wouldnt expect much if any impact.

FWIW I think my clients beat the market a bit. Got one of the few values available and were able to negotiate some very favorable terms as we avoided a multple offer situation that we had been running into on every other one they were interested in.

Submitted by gzz on August 5, 2020 - 1:42pm.

Pretty far from your area, but the other part of SD that interests me is North Park, South Park, and City Heights.

If the new trend is shiny new distant burbs, not gentrification of older semi-suburban areas, they may do poorly.

Submitted by sdrealtor on August 5, 2020 - 4:37pm.

Ok lets focus in a bit. Detached or attached?

Also I think City Heights is a bit behind those two in gentrification. Id suggest North Park and South Park only but if I was gonna expand it would likely be plus University Heights and Normal heights rather than CH.

Update: took a look and its a bit more complicated as I pull the data by zips and the South park zip spans a pretty broad spectrum from South Park (very gentrified) to Golden Hill (quite a bit behind) to Chollas View/Webster (another discussion). I think its best to track a mostly homogenous area so I'll propose North Park, University Heights and Normal Heights which while not completely homogenous is close enough. How does that sound?

Submitted by gzz on August 8, 2020 - 4:29pm.

Wow City Heights gentrification is now priced in. No deals there like even 2 years ago, last time I looked there. Maybe multifamily.

92107: active inventory is 1.2x July closed sales.

Rates: We haven’t broke the Covid-panic all time low of March 9, but the 10 year has never spent so long below 0.6% in US history. Refis meanwhile have ticked down a bit. Put the softening demand for rifis together with lower 10Y rates, nationwide average mortgage rates may drop another 0.2% the next week or two.

Submitted by sdrealtor on August 12, 2020 - 4:22pm.

Update time and Im gonna change something up. I ran numbers yesterday so I have the data but for continuity and to add a metro suburban category Im gonna move this over to the main forums under housing market. Hopefully this will help get more discussion and contributions going.

Submitted by Coronita on August 16, 2020 - 6:44am.

Andrew32 wrote:
On the flip side, any noticeable fall out from the 700+ jobs Intuit cut a little over a month ago? I heard engineering jobs were a good portion of that cut and I imagine some of those employees live along the 56 neighborhoods.

My understanding was San Diego intuit location was not nearly impacted as other locations. San Diego location is mostly Turbo Tax group, and cuts mainly came from the QuickBooks and small biz groups which are more based out of Mountain View and North Carolina?. everyone still needs to do their taxes and in a lot of ways it's a lot more complicated then it ever was. I think what they mostly did in SD was freeze hiring and suspend open recs.

On the flip side, I think Medtronics is running night and day shifts making ventillators. I see a bunch of mobile guys just got hired by biotech companies and they are paying them way more than I could afford to pay them... Several of these companies I think also do covid related testing. Not sure why they need mobile guys but oh well

My company let a lot of engineers go. On my team, 7 mobile engineers we let go found a job in less than 2 weeks, some saw a 20% pay bump. And no, I wasn't paying them low.

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