North County Coastal monitor

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Submitted by sdrealtor on August 12, 2020 - 4:30pm

Time to move this onto the forums for some added visibility and discussions. Ive been tracking this data since the beginning of April when the market was just coming out of a month where the market was frozen in place withe the shelter in place order. Since then the market has come roaring back here.

A few parameters. This data is for detached homes only in Encinitas (92024) and the two S Carlsbad zips (92009 and 92011). I run the data mid afternoon on tuesdays to allow for a day or two of negotiations after the weekend. New listings mostly come on the market between Wed Night and Saturday Morning. New pendings mostly reach agreement between Sunday night and Tuesday Afternoon. I also exclude new homes as its generally a different market.

Im not gonna rehash all the old data but may refer to trends. Anyone wanting to see data can ask or refer back to home page threads.

Submitted by sdrealtor on August 12, 2020 - 4:40pm.

Late Summer and the market should be snoozing.

New listings 31 same as last week.

Very much in line with what we have been seeing since mid-June.

New Pendings down to 31 way down from 55 last week

Thats the lowest count since Mid/late May. Inventory is way down and choices are very limited. The end of Summer seasonality should be showing up also. Will be of note to follow where it goes from here

Net-net inventory may have bottomed and it should start climbing a tad after ten consecutive weeks of falling inventory around my 3 zips.

Closed sales at 37 the high point since early April and reflects all the frenzy of last few months.

Price reductions at 15 which is pretty much where its been or lower. Sellers know the market is hot.

Total houses for sale 121

Submitted by The-Shoveler on August 13, 2020 - 7:02am.

I was talking to a realtor in TV,

No way to verify but he said that last house he sold had 40 offers.

Submitted by Andrew32 on August 13, 2020 - 9:10am.

Appreciate the ongoing info Sdrealtor. We’re looking at S. Carlsbad for early 2021. Currently renting in PQ to test the area before buying and want a neighborhood that has more younger families and closer to the coast. In late 2017, we bid above asking in Encinitas and countered but the owner took an all-cash, no inspection, no contingency offer from someone else at the same price. Felt defeating and so we are only now exploring going for it again. And as a result, that has pushed us a little further north than we were originally looking.

Submitted by sdrealtor on August 13, 2020 - 10:26am.

The-Shoveler wrote:
I was talking to a realtor in TV,

No way to verify but he said that last house he sold had 40 offers.

I ran into about 20 on a 1.2 house in 4S Ranch. I'd believe him but likely an exception with a very desirable house. The good ones always attract a crowd. Most likely realtor was chest pumping as if they had something to do with it. When you see that many it's always the house and the market

Submitted by sdrealtor on August 13, 2020 - 11:50am.

Andrew32 wrote:
Appreciate the ongoing info Sdrealtor. We’re looking at S. Carlsbad for early 2021. Currently renting in PQ to test the area before buying and want a neighborhood that has more younger families and closer to the coast. In late 2017, we bid above asking in Encinitas and countered but the owner took an all-cash, no inspection, no contingency offer from someone else at the same price. Felt defeating and so we are only now exploring going for it again. And as a result, that has pushed us a little further north than we were originally looking.

Happy to help! Ive been in my home on the S Carlsbad/Encinitas border since it was built in 99 and Encinitas a few years before that. My guess is you were bidding on a 1 story in Encinitas. There are a lot of them and its one reason Encinitas has become such a magnet for downsizers and retirees relocating here as its also close to the beach and such a charming town. Here are a few tips.

Along the NCC 60 to 70% of what you are buying is land value. When you see a crappy old house on a nice lot in a nice location remember this.

92009 is actually complicated with a wide variety of neighborhoods nearly all good but feeding into the 3 different school districts. Take the time to become familiar with that. The good news is when I moved here the differences were much substantial than they are now and all are exceptional now IMO.

That leads to next point which is to consider southwest 92078 which borders Carlsbad, has some great neighborhoods with great homes and is more affordable.

Next point, consider moving up your timeline. Things are quietest between Mid October and Mid Jan. Thats is your best chance to get great home with less competition. What I consider my best sale ever and would put up against any sale along the NCC in the last 10+ years as the single best home and deal purchased on the open market by any agent was put together in late November.

Last point, we are blessed with a lot of very good, knowledgeable and ethical agents here. We also have a lot who arent. These are shark filled waters. Make sure you know who you are dealing with and that they are familiar with the agents they are dealing with.

With that said this is a phenomenal place to live and raise a family. I hope things work out well for you. Feel free to ask questions on this thread or privately if you prefer.

Submitted by Andrew32 on August 13, 2020 - 12:01pm.

It was a 4/3 two story in Encinitas but came in more affordable bc it had a zero lot line on one side. Lots of privacy still and the previous owner was a G&E executive so the appliances and kitchen was unreal.

Thanks for the timeline advice. We’re currently looking at 92011 and 921009.

Thoughts on the upcoming Treviso phases at the end of Poinsettia? There is a 5/4 “next gen” floorplan that are all perimeter lots and the HOA/MR feels priced into the sticker price fairly.

Submitted by sdrealtor on August 13, 2020 - 3:21pm.

Gotcha and knowing Encinitas it had to be in one of a small handful of neighborhoods one of which I used to live in. For whatever reason people like writing Encinitas on their return address and they sell for a healthy premium over similar homes in adjacent 92009 despite using all the same local services including the same schools. It just is what it is.

I stopped by Treviso several months ago and liked the floorplans. It seemed like a more than fair value to get a newer home in 92011. I understand wanting new also as I bought new in 99 as did all my neighbors. It was great and there was a real comradery but understand this is a mobile place to live. In the first 5 years the house next door sold twice, my kids lost their best friends to relocation and some of what I romanticized about growing old with neighbors and kids did not come to be.

Also when Poinsettia opens up it could be a very busy thorofare. Right now there is a ton of traffic from San Marcos, Vista Shadowridge, Oceanside, Rancho Carillo and beyond that uses RSF/Olivenhain/Leucadia Blvd to get to the 5. A lot of that traffic could well end up on Poinsettia so I would put a big premium on getting a lot/location away from the noise and visual path of that.

Here is one more big consideration. For a nice, new home with a good location it looks like a very good value and it is right now. But I beleive appreciation over time will be below average due to lot sizes. When you buy a house you are essentially buying an expensive car on a prime parking space in Manhattan. Over time that parking space gets more valuable but the car depreciates unless you upgrade it or replace it. Homes are no different. It will hold its value as a newer home with a more modern floorplan on the low end of the price range in 92011 but in 15 to 20 years it will be an older home in need of remodelling on a small lot. As land becomes more scarce and valuable that is where the above average returns are likely to be.

Bottom line there is a lot to like about Treviso especially on the right lot/location but in the end it depends upon personal situation and goals.

One more note on timing with an anecdote. Lots of opinions get thrown around by agents many of which are dead wrong. One is that to move up you need to spend as much as 50% more than your current home to make it worthwhile. What you need to be is patient, smart and take advantage of seasonality.

Case in point, last Fall I sold a friend/clients 2200 sq ft 35 year old home on a busy neighborhood feeder street in 92011 and they upgraded to a 3700 20 year old home on a quiet cul de sac with a great view in 92011 for 10% more than the house they sold. The house they sold was very nice as he was in the kitchen/bath remodelling business but it was pretty maxed out. And here's the kicker, they bought their new home with a contingency on selling their present home. It was an amazing feat to pull off and no way it would have happened anytime other than Fall. Thats the power of seasonality!

Submitted by Reality on August 13, 2020 - 10:50pm.

The-Shoveler wrote:

No way to verify but he said that last house he sold had 40 offers.

In the first 5 minutes it was listed to boot!

Submitted by sdrealtor on August 19, 2020 - 2:13pm.

Back to school time! Market should be paused up here. It isnt!

New listings 32 same as last week.

Very much in line with what we have been seeing since mid-June. They keep coming at a slow steady pace not meeting demand.

New Pendings up to 44 back up from a lull last week. Did not expect that! Thats 12 more than the new listings. Inventory has now been declining for 3 solid months.

Closed sales at 37 again the high point since early April and reflects all the frenzy of last few months.

Only 10 price reductions.

Total houses for sale back down to 112.

Market still cruising

Submitted by evolusd on August 19, 2020 - 2:56pm.

sdrealtor wrote:
Back to school time! Market should be paused up here. It isnt!

New listings 32 same as last week.

Very much in line with what we have been seeing since mid-June. They keep coming at a slow steady pace not meeting demand.

New Pendings up to 44 back up from a lull last week. Did not expect that! Thats 12 more than the new listings. Inventory has now been declining for 3 solid months.

Closed sales at 37 again the high point since early April and reflects all the frenzy of last few months.

Only 10 price reductions.

Total houses for sale back down to 112.

Market still cruising

Thanks for the update!

Submitted by mom2dmd on August 25, 2020 - 12:16pm.

How are things looking this week?

Submitted by sdrealtor on August 25, 2020 - 1:04pm.

I run my data late afternoon on Tuesdays. Will know in a bit but don't always get it up same day

Submitted by sdrealtor on August 25, 2020 - 10:00pm.

Kids are back in school! I've got 4 high school seniors out back each day attending virtual classes in a large pop up tent. Gonna be an interesting few months until schools hopefully re-open for physical attendance.

New listings 19 is the lowest since early April when it was 18.

As one might expect with back to school and hopefully they bounce back up the next few weeks.

New Pendings up to 41 so the buyers didnt take a break! That ripped a big chunk out of active inventory here. Did not expect that! Thats minus 22 compared to new listings. Inventory keeps declining. It is particularly low in the two South Carlsbad zips. Maybe the lowest Ive seen in 20 years.

Closed sales at 36 reflecting all the activity through Summer.

Slight uptick with 16 price reductions. If your house isnt selling with inventory this low its time to take a hard look at price.

Total houses for sale down to 103. There are as many in Encinitas as the 2 S carlsbad zips. Ive never tracked that but experience tells me thats astounding and reflects the fact that Encinitas is becoming increasingly high end.

We have about 1/2 month inventory around here and most is very high priced

Market still cruising but with so little on the market I think these pendings gotta start dropping in a big way soon.

Submitted by mom2dmd on August 26, 2020 - 7:36am.

Appreciate the update!

Submitted by evolusd on August 26, 2020 - 2:16pm.

That new one on Durango Cir in 92011 seems like a deal for someone that only needs a 3/2 and has attached rental. Bet it gets bid up.

Submitted by sdrealtor on August 26, 2020 - 3:47pm.

Agree. I think its mispriced and even though it will get bid up it wont reach the level it could have sold for. But it will sell quickly, thats for certain!

Submitted by evolusd on August 28, 2020 - 11:00am.

sdrealtor wrote:
Agree. I think its mispriced and even though it will get bid up it wont reach the level it could have sold for. But it will sell quickly, thats for certain!

Pending already!

Submitted by sdrealtor on August 28, 2020 - 4:46pm.

Of course. I thought it was listed at least 10% too low, maybe 20%. ADU's are so new and there is no data on the market to value them. IMO Id want to shoot high and test the market. They started low and let the market dictate. Not saying thats the wrong approach just that Id come at it differently. Over time it will get figured out one way or the other.

Submitted by mom2dmd on August 28, 2020 - 7:15pm.

It seems as though ADUs are helping properties West of I-5 in Cardiff and Encinitas sell faster and at higher prices.

Submitted by sdrealtor on August 30, 2020 - 9:38am.

I dont know about that as I havent seen any good examples. Can you provide examples? Also everything is selling fast and for high prices so I would not necessarily attribute it to that. This is how I would look at it.

A 1BR condo in this area (not west of 5) starts around $350K and comes with high HOA fees plus RE taxes. Rents for a 1BR start around $1700. It costs at least $150K and likely more to build a decent one. Purely as an investment property I cant see how one wouldnt add at least $150-$200K or more to the value of a property until proven otherwise. While it is till a hypothesis I think its a very strong one. Id certainly want to test that valuation if I was a seller in this market

FWIW I have a client that built a beautiful 2/2 ADU west of the 5. Because it got classified as an ADU he cant do rentals less than 30 days. He does monthly rental fully furnished. His annual rental income would drop your jaw on the ground.

Submitted by gzz on August 31, 2020 - 2:55pm.

"Because it got classified as an ADU he cant do rentals less than 30 days."

Most of the "Let's regulate AirBNB" proposals in San Diego treat ADUs better than condos in terms of short term rental regulation.

What people seem to really hate are the big AirBNB companies that rent out dozens of places or convert apartment complexes to AirBNBs.

An ADU has the owner right on site and able to police noise issues etc.

Anyone know of the new creature called a "Junior ADU" actually existing somewhere?

"Junior Accessory Dwelling Units Law In California

The State of California recently adopted legislation (SB 13, AB 68 and AB 881) that defines the standards local jurisdictions can apply to Accessory Dwelling Units (ADU) and Junior Accessory Dwelling Unit (JADU). This legislation is contained in the California State Government Code Section 65852.2. Read more
Junior Accessory Dwelling Unit (JADU) General Provisions

A. There is a limit of one JADU per lot zoned for single-family residences. The JADU shall be constructed within walls of a proposed or existing single-family residence.
b. Maximum size is 500 square feet, however, an additional 150 square foot expansion beyond the physical dimensions of the existing structure is permitted strictly to accommodate ingress and egress to JADU.
c. The JADU shall include a separate entrance from the main entrance to the proposed or existing single-family residence.
d. The JADU shall include an efficiency kitchen, which includes:
i. Cooking facility with appliances (240-volt service outlets now permitted)
ii. Food preparation counter and storage cabinets that are of reasonable size in relation to the size of the JADU
iii. No restriction on maximum waste line diameter
e. A deed restriction is required and must include the following stipulations:
i. Prohibition on the sale of the JADU separate from the sale of the single-family residence.
ii. Restriction on the size and attributes of the JADU.
iii. If a JADU is rented, the unit shall not be rented for a period of less than 30 consecutive calendar days
iv. Owner occupancy of one of the units on-site is required* *Owner-occupancy is not required if the owner is another governmental agency, land trust, or housing organization.
f. The JADU may share sanitation facilities (i.e. bathroom/shower) with a primary residence.
"

Submitted by gzz on August 31, 2020 - 2:58pm.

I see now, the anti-AirBNB 30-day minimum rental provision is if you want to use the state law to "force" the right to build an ADU within a single family zone that doesn't allow them.

Submitted by sdrealtor on August 31, 2020 - 5:54pm.

The ADU is in Encinitas. They didnt have to use the regulations they got trapped by them not getting the benefit of waivers on permits and impact fees when they permitted prior to those but it didnt get finished until the new rules went into force. They got the worst of both ends. Since it is classified as an "ADU" which is meant to help Encinitas address a big affordable housing issue it has to be rented out at least 30 days. He's booked through next Summer already. People have been staying a few months, extending and requesting to come back annually. Its a beautiful unit. Income approximates long term rental rates on a $2M house. Long term they will move into the unit and rent the main house which is not subject to restrictions on rental period.

Ive been walking 5 to 10 miles a day through neighborhoods nearby. I see several JADU's under construction in garages.

Submitted by sdrealtor on September 2, 2020 - 10:05am.

Time for this weeks broken record report

New listings 25 and uptick from last week but still below average.

New Pendings of 38 so the buyers still beating the bushes out there! That took inventory down another notcth with pendings 13 higher than new lisitngs.

Thats 3 solid of months of declining inventory. I took a quick look at the actives. A traditional SFR (not a detached condo, zero lot line or PUD) now starts around $1M. Under that is gonna be something funky, a fixer or in an impaired location.

Closed sales at 38 highest all year.

Back down with 12 price reductions.

Total houses for sale down to 92 with a median around $1.5 in the active inventory. Pendings held up this week but gotta start falling soon with so little inventory

Submitted by sdrealtor on September 9, 2020 - 12:59pm.

Sorry for the late update. I got in a bit of a banger and totaled my car on Friday. Walked away but it threw me for a loop.

New listings 31 another uptick from last week and closer to average for this time of year.

New Pendings of 37 so the buyers sare still very active. Its hard to see how they are still finding things to buy as the pendings were 6 higher than new listings.

Closed sales at 29 so a step down but typical for early in the month. Buyers push to close before month ends to minimize prepaid interest at closings.

Back down with 9 price reductions.

Total houses for sale down to 87 with a median around $1.77 in the active inventory. The low end barely exists at the moment for detached homes up here

Submitted by evolusd on September 10, 2020 - 9:13am.

Thx for the update, sdr. Sorry to hear about the crash! On the bright side, new car!

Submitted by sdrealtor on September 10, 2020 - 11:07am.

My pleasure and thx. Car (Tesla Model 3) wasnt that old and Id get another just like it. May have saved my life and the driver that pulled out in front of me

Submitted by profhoff on September 12, 2020 - 10:50am.

Wondering how all this activity will impact west of 5/east of 5 values.

I'm wondering what all you real estate experts think about what will happen to east of 5 property values?

West of 5 is skyrocketing - I mean there are properties on Eolus in the high two - three millions!

Del Mar Heights is solidly at $3m+ for the fancy flips.

Cardiff homes near the composer district are flying off the shelf in mid-two millions.

Will this *permanently* influence values east of 5, or is east of 5 a bubble waiting to pop?

New construction off Urania near Leucadia Blvd and east of 5 is almost mid-2s. Shea just listed the model off Leucadia Blvd just north of Urania for $2.

Even Caudor, Sparta area is getting pretty pricey.

For as long as I can remember (decades and decades), west of 5 is like a meditation mantra for North County Coastal real estate.

Will the current real estate situation change that?

Submitted by Escoguy on September 12, 2020 - 12:23pm.

Also glad you are safe, my wife has VIN 3333 on her 3.
Perhaps consider a Y.

Also appreciate the added commentary.

You are right, buyers are coming in hot out there. After we contracted in 92127 4S, two came on the market and were both gone in days, one 30K above list and another listed (same floor plan as ours) at 23K higher and probably went for 10-15K above list.

Can't always predict when that will happen. The real number of days on the market was like 3 as it just took time to sort the bids.

Submitted by sdrealtor on September 12, 2020 - 6:10pm.

profhoff wrote:
Wondering how all this activity will impact west of 5/east of 5 values.

I'm wondering what all you real estate experts think about what will happen to east of 5 property values?

West of 5 is skyrocketing - I mean there are properties on Eolus in the high two - three millions!

Del Mar Heights is solidly at $3m+ for the fancy flips.

Cardiff homes near the composer district are flying off the shelf in mid-two millions.

Will this *permanently* influence values east of 5, or is east of 5 a bubble waiting to pop?

New construction off Urania near Leucadia Blvd and east of 5 is almost mid-2s. Shea just listed the model off Leucadia Blvd just north of Urania for $2.

Even Caudor, Sparta area is getting pretty pricey.

For as long as I can remember (decades and decades), west of 5 is like a meditation mantra for North County Coastal real estate.

Will the current real estate situation change that?

Sold a good friend a place west of 5 in Encinitas around 2011. I'd put the deal against anything anyone has bought in the last 10 years along NCC as the best anyone got anywhere. Paid just over $1m and it's now well over $3m. It's also not replicable anywhere around here. Literally a gated estate that looks like it could be in Brentwood.

East of the five is just as hot. Maybe some minor retracement at some point but not coming down in a big way. I've been predicting this for years. This place has fundamentally changed and been discovered by the masses. Wait till the new hotel opens and really rich people find out what's here. Hope you were well advised over the years and got yourself something great too

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