OCTOBER/NOVEMBER 2010 Chris Heller

Inside This Issue Keller Williams Realty

171 Saxony Road, Ste. 205
> LOCAL MARKET TRENDS ..................... 1
Encinitas, CA 92024
> MORTGAGE RATE OUTLOOK ............... 2 (888) 255-5565
> HOME STATISTICS .............................. 2 chris@hellerthehomeseller.com
> STATISTICS: GAUGING THE MARKET .... 3 http://www.hellerthehomeseller.com
DRE #00851991
> CONDO STATISTICS ............................ 3
> CHARTS: SP/LP & SALES YTD .......... 4

The Real Estate Report

local market trends NORTH COASTAL SAN DIEGO COUNTY
Trends at a Glance
(Single-family Homes)
Sep 10 Aug 10 Sep 09
Median Price: $ 375,000 $ 377,425 $ 366,750
Av erage Price: $ 487,418 $ 480,200 $ 463,088
Home Sales: 1,720 1,868 2,004
Seasonal Slowdown Begins Pending Sales:
Inv entory :
2,946
11,244
2,954
11,669
3,738
9,898
The seasonal slow-down in sales begins in price and list price is 5%, as a general rule. (Condos/Town Homes)
September and runs through the holiday sea- The median ratio since January 2001 has Median Price: $ 210,000 $ 220,000 $ 225,000
son. You can see this in our Sold Prices & Unit been 97.3%. In September, the ratio was Av erage Price: $ 270,281 $ 262,110 $ 266,996
Condo Sales: 830 936 1,073
Sales chart in which we use a 3-month moving 97.1%. The highest the ratio has gone is Pending Sales: 1,549 1,521 2,073
average to smooth out month-to-month fluc- 99.6% in November 2009. The lowest is Inv entory : 5,568 5,845 5,048
tuations yet still maintain seasonal variation. 94.7% in November 2007. The sales price to list price ratio for con-
What is of interest is not the seasonal slow- Another interesting statistic to gauge the mar- dos/townhomes was 97.8% last month. The
down, but the year-over-year numbers. They ket is Days on Market (DOM). A short period lowest the ratio for condos has been over the
show some continuing weakness in the San points to a sellers' market, while a large period past ten years is 95%, while the median is
Diego County market. Sales of single-family, points to a buyers' market. Days on market, 97.9% and the high is100.4%.
re-sale homes were down 14.2% from last which we calculate in San Diego County as Days on Market for condos was 86 in Septem-
September. Year-to-date, home sales are the number of days from when the property ber. Over the past ten years, the lowest
down 4%. was listed to when the property goes into es- monthly DOM is 16, the median DOM is 59,
crow, was 79 last month. Over the past ten while the high peaked at 86.
The median price, while losing 0.6% from Au-
years, the lowest monthly DOM is 27, the me-
gust, was up 2.2% from last September. This For complete information on a particular
dian DOM is 60, while the high peaked at 83.
is the thirteenth month in a row the median neighborhood or property, or for an evaluation
price has been higher than the year before. Sales of condos/townhomes were off 25.5% of your home's worth, call me.
year-over-year, while the median price gained
The sales price to list price ratio is a good sta-
0.3%.
tistic to gauge the health of the market. In a
normal market, the spread between the sales

San Diego County Homes - Sales, Pending & Days of Inventory HOW TO READ THE CHART
(3-month moving average) The blue area is the number of days it would take
4,000 600 to sell all the homes for sale at the current rate of
3,500 sales.
500
Days of Inventory
Sales & Pending

3,000 The green line shows the number of homes in es-

2,500 400
crow. Normally, this line tracks closely with the red
2,000 300 line, which shows actual sales.
1,500 200
1,000 As you can see, the two lines have diverged over
500 100 the past year. This is due to many homes being put
0 0
into escrow as short-sales, contingent upon the
0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND1 FMAMJ J AS banks’ approval. This is being done even before
6 7 8 9 0 the banks know about the short sale. Subse-
quently, many of these escrows do not close.

Chris Heller | chris@hellerthehomeseller.com | (888) 255-5565

 The Real Estate Report

Mortgage Rate Outlook

30-Year Fixed Mortgage Rates Oct. 1, 2010 -- After near stasis for the past six weeks, overall, but to us, much of the weakness seemed to
mortgage rates again managed a bit of a decline be concentrated in July and August.
amid mixed economic messages. Increasing specu-
07-10 The big employment report doesn't come until next
04-10 lation that the Fed will initiate substantial purchases
week, and it's the big gorilla in a fairly empty room.
01-10 of Treasury bonds (so-called "quantitative easing") to
10-09 Stock and bond markets enjoyed unexpectedly favor-
kick-start the economy from its bare expansion
07-09 able conditions in September, which is not noted to
04-09 helped to drive interest rates a bit lower.
be a historically great period for equities. October's
01-09
10-08 HSH's overall mortgage monitor -- our weekly Fixed- been known to be a difficult period, too, but if Sep-
07-08 Rate Mortgage Indicator (FRMI) -- saw the average tember's any indicator, perhaps the markets are sim-
04-08 rate for 30-year fixed-rate mortgages shed five basis ply becoming accustomed to being in active crisis,
01-08
10-07 points to begin October at 4.70%. Important to first- and can find reasons to celebrate when we're not.
07-07 time homebuyers and low-equity refinancers alike, Here's hoping that the rally's got more substance
04-07 30-year FHA-backed mortgages sported an average behind it than that, but there's nothing wrong with a
01-07
10-06
of 4.40% for the week. The overall average for Hybrid little optimism showing somewhere.
07-06 5/1 ARMs declined by six basis points (.06%), finish-
P.S. If you missed it over the last few weeks, you
04-06 ing our national survey at 3.61%. HSH.com's FRMIs
01-06 should have a look at our plan to help responsible
include rates for conforming, jumbo, and most re-
10-05 homeowners who are underwater. Unlike the "FHA
07-05 cently the GSE's "high-limit" conforming products and
Short Refi" idea, the concept doesn't penalize home-
04-05 so covers much of the mortgage-borrowing public.
01-05 owners or investors... and there might even be no
10-04 We mention above that the economic news seems cost to taxpayers, either. Curious? Read HSH.com's
07-04 more mixed to us. It wouldn't be hard to improve Value Gap Refinance idea:
04-04
01-04 upon second quarter GDP, which came in at a final http://www.hsh.com/ValueGapRefi.html
reckoning of 1.7%, but there does seem to be a mild
3.0% 4.0% 5.0% 6.0% 7.0% 8.0%
overall uptick (or at least greater stability) in the news
for September, the final month of the third quarter.
There can be no doubt that 3Q10 will be a weak one
The chart above shows the Na-
tional monthly average for 30-
year fixed rate mortgages as San Diego County — Homes: Sold Prices & Unit Sales
compiled by HSH.com. The aver- (3-month moving average — price in $000's)
age includes mortgages of all
$800 2,500
sizes, including conforming,
"expanded conforming," and $700
2,000
jumbo. $600
$500 1,500
$400 1,000
$300
500
$200
$100 0
0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND1 FMAMJ J AS
6 7 8 9 0
Ave Med Sales
North San Diego County Coastal - September 2010
SINGLE-FAMILY HOMES % Change from Year Before
Prices Prices
Cities Median Average Sales Pend Inven DOI SP/LP Med Ave Sales Pend Inven
County $ 375,000 $ 487,418 1,720 2,946 11,244 190 97.1% 2.2% 5.3% -14.2% -21.2% 13.6%
N. County Coast $ 525,000 $ 723,910 419 647 3,130 217 96.4% 13.9% 12.3% -18.5% -24.5% 3.4%
Cardiff by the Sea $ 860,000 $ 1,271,430 7 4 53 220 92.2% 15.4% 2.5% 40.0% -63.6% 1.9%
Carlsbad $ 710,450 $ 728,521 64 118 436 198 96.7% 9.0% 9.9% -22.9% -15.1% 33.7%
Carmel Valley $ 855,000 $ 919,162 42 44 204 141 96.4% -2.5% 1.8% -4.5% -2.2% -16.4%
Del Mar $ 1,587,500 $ 1,805,500 14 10 151 313 92.8% 15.9% 6.7% -17.6% -58.3% -1.3%
Encinitas $ 839,000 $ 978,239 31 47 218 204 97.0% 7.6% 10.5% -13.9% -7.8% -0.5%
Fallbrook $ 320,000 $ 380,744 37 70 367 288 97.1% -12.3% -3.9% -22.9% -27.8% 8.6%
La Jolla $ 1,315,000 $ 1,504,650 25 33 298 346 92.4% -13.8% -16.7% 31.6% -29.8% -4.2%
Oceanside $ 329,625 $ 327,395 112 176 640 166 97.8% 1.1% 1.1% -31.3% -31.0% 14.1%
Rancho Santa Fe $ 2,414,500 $ 2,789,490 13 29 309 689 89.7% 13.1% 6.0% 18.2% 16.0% -13.0%
San Marcos $ 380,000 $ 376,357 74 113 427 167 95.4% -5.6% -7.9% -22.9% -12.4% 7.0%
Solana Beach $ 925,000 $ 1,128,080 7 10 52 215 96.1% -21.3% -3.4% -12.5% 42.9% -35.8%
Page 2 Vista $ 340,000 $ 314,234 67 106 402 174 97.1% 9.9% -0.6% -16.3% -32.1% 3.9%
 San Diego County Homes: Year-Over-Year Median Price Change
30.0%
20.0%
10.0%
0.0%
0 FMAMJ J A SOND 0 FMAMJ J A SOND 0 FMAMJ J A SOND 0 FMAMJ J A SOND 1 FMAMJ J A S
-10.0%
6 7 8 9 0
-20.0%
-30.0%
-40.0% © 2010 rereport.com

> STATISTICS: GAUGING THE MARKET

Knowing how the market is trending is important in
making astute decisions whether one is a buyer or a
seller. For instance, if prices are trending upward, a
buyer may decide to accelerate the purchase, while a
potential seller may decide to delay.
With the proliferation of real estate statistics on the
Internet, the “noise” level is increasing making it more
difficult to know which statistics are important and which
are irrelevant.
In this month’s report, we are going to start a primer on
real estate statistics to help you separate the wheat
from the chaff.
The first two principles of real estate statistics are:
1. Know the source of the raw data used, and
2. Understand the methodology used to crunch the
raw data.
There are only two accurate sources of raw data, each of
which has its pluses and minuses. The first is data from
the county assessors’ offices. The main plus of this data,
used by companies such as DataQuick and often cited
by local newspapers, is that every transfer of real
property is required by law to be recorded with the county
assessor. This is the most accurate data available.
The minuses of county assessor data begins with the
ability of buyers to ask the assessor not to reveal the
sales price. This is usually done only with high-priced, or
high-profile transactions and only affects a minute
number of sales.
The other major minus of county assessors’ data is it
ONLY contains sold properties.
The second most accurate data comes from the local
Multiple Listing Services (MLS).
(Continued on page 4)

San Diego County — Condos: Sold Prices & Unit Sales

(3-month moving average — price in $000's) Table Definitions
$500 1,500 _______________

$400 Median Price

1,000 The price at which 50% of prices
$300 were higher and 50%were lower.

500
$200 Average Price
Add all prices and divide by the
number of sales.
$100 0
0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND1 FMAMJ J AS
6 7 8 9 0 SP/LP
Ave Med Sales Sales price to list price ratio or the
price paid for the property divided
North San Diego County Coastal - September 2010 by the asking price.
CONDOS % Change from Year Before
Prices Prices DOI
Cities Median Average Sales Pend Inven DOI SP/LP Med Ave Sales Pend Inven Days of Inventory, or how many
County $ 210,000 $ 270,281 830 1,549 5,568 195 97.8% 0.3% -2.1% -25.5% -22.4% 11.4% days it would take to sell all the
N. County Coast $ 242,500 $ 332,567 170 330 1,245 212 96.2% -19.8% -13.5% -16.7% -12.2% 14.5% property for sale at the current rate
of sales.
Cardiff by the Sea $ 490,000 $ 610,000 7 5 20 83 97.4% 10.2% 15.0% 16.7% -16.7% 53.8%
Carlsbad $ 325,000 $ 352,278 23 61 222 280 95.3% 3.8% 6.2% -39.5% 10.9% 65.7%
Carmel Valley $ 350,500 $ 389,947 15 23 104 201 94.9% -14.5% -4.4% -57.1% -50.0% 5.1% Pend
Del Mar $ 222,500 $ 261,250 4 5 50 363 101.1% -70.1% -62.2% -42.9% -50.0% 8.7% Property under contract to sell that
Encinitas $ 355,000 $ 367,611 9 25 87 280 96.5% -17.0% -16.0% 0.0% 4.2% 35.9% hasn’t closed escrow.
La Jolla $ 435,000 $ 751,444 18 38 204 329 96.0% -29.3% 12.7% -28.0% -13.6% -3.8%
Oceanside $ 172,750 $ 212,626 78 126 408 152 96.3% -2.7% 0.7% -13.3% -6.7% 10.9% Inven
Rancho Santa Fe $ - $ - 0 0 0 0 0.0% 25.5% 21.7% 200.0% n/a -9.1% Number of propertiesPage 3 for
actively
San Marcos $ 240,000 $ 253,065 26 43 160 178 99.6% 11.1% 16.4% -31.6% -10.4% 22.1% sale as of the last day of the
Solana Beach $ 630,000 $ 559,667 3 13 54 522 95.0% 32.6% 16.6% -40.0% -27.8% 3.8% month.
Vista $ 178,000 $ 175,057 12 26 72 174 98.6% 8.9% 1.5% -50.0% -40.9% -2.7% Page 3
 The Real Estate Report
N. Coast San Diego County
Chris Heller
Keller Williams Realty
171 Saxony Road, Ste. 205
Encinitas, CA 92024

For a FREE subscription and the city by city break-

down, go to our web-site at:

http://www.hellerthehomeseller.com

San Diego County: Single-family Homes

(Continued from page 3)
Sales Price/Listing Price Ratio
101%
The real benefits of MLS data come in the type of data 100%
collected. The MLSs report on inventory, properties under 99%
contract to be sold, length of time it takes to sell, and the 98%
sales price to list price ratio. 97%
96%
This data is important for determining the direction of the 95%
market. 94%
93%
NEXT MONTH 92%
This primer will continue with determining which statistics 0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND0 FMAMJ J ASOND1 FMAMJ J AS
are useful for determining market trends and which are 6 7 8 9 0
useless.
The three most fundamental statistics to track are: Property Sales
1. Inventory on the market, (Year-to-Date)
35,000
2. The spread, or the difference between the asking 30,000
price and the sales price, and,
25,000
3. Time on the market. 20,000
We will discuss these and several more important statistics 15,000
in the next installment. 10,000
So, subscribe to this report to make sure you are notified 5,000
when the next portion is available. 0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Condos 8,686 9,154 10,018 11,122 11,399 8,207 7,195 7,036 8,735 8,690
Homes 18,287 19,507 21,776 21,806 20,713 15,736 13,271 14,042 17,113 16,424

This Real Estate Report is published and copyrighted by http://rereport.com.

Information contained herein is deemed accurate and correct, but no warranty is implied or given.