Home and Condo Sales Continued Rising in March

Sales of single-family, re-sale homes rose 15.4% from February, reaching the highest level since last August. Year-over-year, home sales were off 33.2%.

The median price for single-family, re-sale homes in San Diego County was flat in March at $440,000. Year-over-year, the median price of homes was down 24.1%. The average price for homes rose 5.2% from February, off 15.1% year-over-year.

Condo sales gained 17.5%, month-over-month, down 37.2% compared to last March.

The median price for condos was also flat at $295,000, off 21.3% year-over-year. The average price for condos fell 0.2% month-over-month, down 14.8% compared to last March.

Remember, these are statistical prices. When the market was going up, the large number of million dollar plus sales skewed prices upward. With the large number of bank-owned properties going through the system, prices are being skewed downward.

The sales price to list price for single-family homes fell 1.4 points to 93.1%. The ratio for condos dropped 0.4 of a point to 94.5%.

Days on market for homes fell three days to 81 days. Days on market for condos rose one to 87 days. Take these numbers with a grain of salt. If a property listing is canceled, withdrawn or expired and then re-listed, days on market is re-set to zero.

The real estate market is very hard to generalize. It is a market made up of many micro markets. As Leslie Appleton-Young, chief economist for the California Association of Realtors, recently said, "Knowing the median price is interesting, but it is as indicative of the value of your home as knowing the median temperature in America is to predicting the local weather." For complete information on a particular neighborhood or for an evaluation of your home's worth, call me.

San Diego Homebuyers' Expo

The first-ever Consumer Homebuyers' Expo coming to the San Diego Convention Center next month. The San Diego Association of REALTORS® and the Building Industry Association of San Diego County have partnered for this one-day event that will take place on May 10 from 10 a.m. to 6 p.m.

The expo will feature free seminars addressing a variety of topics in both English and Spanish including:

How to Qualify For a Home Loan;

the Dos and Don’ts of Home Buying;

Energy Saving and Green Opportunities;

How to Choose and Work with a REALTOR®;

Understanding Your Credit Score;

Finding a Loan that Best Suits Your Budget;

Understanding the Tax Benefits of Homeownership; and more.

Prospective homebuyers will learn how to navigate through Southern California's real estate market while getting the opportunity to meet with more than 200 industry vendors and experts.

Admission is free with this coupon!

655 to Zero in 5 Seconds

The current chaos in the lending industry is presenting us with new challenges all the time. A few weeks ago we were hit with banks reducing or freezing equity lines causing fits for those who were counting on their HELOCs as swing loans, or to purchase property when a good deal came around. So I advised my clients to take the money out now if they thought they were going to need it later this year.

Now we have another wrinkle - credit scores. Have you ever heard of someone having NO credit score? A FICO score of ZERO? This just happened to a buyer who was pre-approved for a loan, had a credit score of 655. Purchased a property. Then the lender went to double-check the credit score, and it dropped from 655 to zero overnight. The reason? The buyer didn't have enough "activity" going back two years to generate a score. It used to be that if you didn't borrow a lot of money and didn't havde a lot of debts to pay back, that was a good thing. Well in 2008 it's now a bad thing. FICO has decided that without enough recent evidence that you faithfully pay credit back on time, they will not issue a score.

The moral of the story is that if you want a credit score, you must have "activity" in the past two years. I don't know how much activity or what kind of activity, only FICO knows, and they hold your credit score in their hands. Scary.

Fun With Foreclosures

The foreclosure glut continues here in San Diego County, and there are new twists every day just to keep life exciting! For example, we have a bank who refuses to sign the Smoke Detector and Water Heater disclosure even though it is required by California law. The bank's response? "WE DON'T CARE WHAT CALIFORNIA LAW SAYS." So Mr. Buyer, if you want this bank owned property you have to buy it without the protections afforded you by law, because the bank DOESN'T CARE WHAT THE LAW IS. Definitely buyer beware!

And the buyers are out there clamoring for these properties. Just this morning I checked out 96 homes for a few potential buyers I'm working with in North County. Most of them were in bad areas or short sales. The best one is a bank owned property in Rancho Del Oro, a nice family area of Oceanside. 1919 square feet built in 1996, listed for $343,900.


This property has been on the market for 10 days, and if definitely a good deal. Here's the catch - there are 30 (thirty) offers on it as of this morning! Countrywide bank, the seller, has countered everyone verbally with "highest and best", meaning take your best shot. So the house will definitely sell for significantly higher than the asking price. As I said in a previous blog posting, you have to look at these things as an auction, with the listed price merely the starting point for the bidding.

How high will it be bid up? This last week we were working with a buyer who made a $350K bid, all cash, close in two weeks, on a bank owned property that was listed at $308,900. We didn't get it! I won't know what it sold for until it closes escrow, but it had to be more than $350K, or at least 13% above asking price.

Now here's the point I want to drive home - there were 30 offers! In this supposedly dead market where no one is interested in real estate anymore, thirty buyers were looking for property, saw this one and made an offer on it. Thirty! What does that tell you? What it tells me is that there is an enormous pent-up demand for housing in this highly desirable area of the country. I promise you, for every buyer who is out there trying to find a good property today, there are ten more who are sitting on their hands waiting for the bad news to blow over. And when it does, there will be buyers flooding the market, there will be panic buying, and prices will rise very quickly. Mark my words!