Selling a home in the current market remains difficult. Buyers continue to demand greater discounts on homes for sale.
As reported last month, Carlsbad's luxury market is competitive and prices are trending downward. There are 549 single family homes for sale in Carlsbad. Of those homes, 190 are currently priced at more than $1 million; an above average number in Carlsbad.
Not only are there a larger number of homes for sale, the recent sales are showing that current buyers are buying fewer luxury homes. Only 18 percent of homes under contract or sold in the last three months were more than $1 million. Market time is expected to increase and prices may be reduced as a result.
FHA loans benefit first-time buyers
Federal Housing Administration, or FHA, and Veteran's Administration loans are the driving force of homes priced $700,000 and less. The economic stimulus package implemented this year has temporarily raised the FHA loan limits in San Diego from $417,000 to $697,500. Designed to benefit first-time homebuyers, FHA loans need only a low 3 percent down payment that can come as a gift from a family member, employer or charitable organization. In today's market, a traditional mortgage often requires a 5 percent to 10 percent down payment from money that has seasoned for six or more months in a personal account. FHA loan programs also are available to borrowers with less-than-perfect credit scores; a welcomed relief to the stricter standards of today's lending market. First-time homebuyers are finding three bedroom homes in Oceanside and San Marcos, once priced at $550,000, marked down to $375,000. With the tax deductions and low interest rates, people are finding they can own a home for less than it would cost to rent at the same residence.
Townhomes and condos
For several years now, buyers have ignored townhomes and condos and opted to purchase the larger, more expensive single family homes. With fewer buyers purchasing townhomes, the average price for a Carlsbad condo that is 1,500 square feet or less fell from a high of $433,340 in 2004 to the current $370,000. But over the last 12 months, homebuyers are making more conservative buying decisions, opting for smaller homes with a less expensive monthly payment. A three bedroom Carlsbad condo in Rancho Carrillo was recently listed for $285,000, which is a big difference from the $400,000 asking price it could have commanded in 2005. With the new prices, attached homes have become attractive to both homebuyers and investors. With correct pricing, those who own attached homes should have an easier time selling this summer than compared to recent years.
Mortgage rates
Since 2006, mortgage rates have followed a trend of lowering through the winter months only to reverse and go up during the months leading into summer. Recently, 30-year fixed mortgage rates have risen to an average of 6.32 percent from an average of 5.48 percent in January of this year. Any sudden movement in rates cause stress in the marketplace. From May to June, interest rates jumped from 6 percent to 6.3 percent. If mortgage rates follow the same trend as previous years, we should see the rates move into the high 6 percent by the end of summer.
New construction
Today's buyers demand a functional property that provides the opportunity to take advantage of working from home. Residences that provide a separate home office or living quarters remain in high demand. High speed Internet enables a professional to telecommute to work from the comfort of their Carlsbad home. A casita, a small living area separate from the main residence that may have a full kitchen, is a rare find in Carlsbad. Buyer's also want the ability to have family, possibly retired parents, visit and stay without feeling like guests. Fiori of La Costa Ridge, a Warmington Homes development, recently sold out its popular development in La Costa. Two of the three floor plans had a retreat or detached casita, each with its own bath. According to the sales professionals at Fiori, the separate living areas were extremely popular with buyers and helped sell the first development in La Costa Ridge. If you are looking for a home with separate living quarters, venture over to Veridian, a Davidson home development in La Costa Greens. Veridian is currently in Phase 3 of 7 and is selling very well, despite the market slowdown. Two of its four floor plans have separate living areas with bathrooms. Visit the models for pricing and availability.
As reported last month, Carlsbad's luxury market is competitive and prices are trending downward. There are 549 single family homes for sale in Carlsbad. Of those homes, 190 are currently priced at more than $1 million; an above average number in Carlsbad.
Not only are there a larger number of homes for sale, the recent sales are showing that current buyers are buying fewer luxury homes. Only 18 percent of homes under contract or sold in the last three months were more than $1 million. Market time is expected to increase and prices may be reduced as a result.
FHA loans benefit first-time buyers
Federal Housing Administration, or FHA, and Veteran's Administration loans are the driving force of homes priced $700,000 and less. The economic stimulus package implemented this year has temporarily raised the FHA loan limits in San Diego from $417,000 to $697,500. Designed to benefit first-time homebuyers, FHA loans need only a low 3 percent down payment that can come as a gift from a family member, employer or charitable organization. In today's market, a traditional mortgage often requires a 5 percent to 10 percent down payment from money that has seasoned for six or more months in a personal account. FHA loan programs also are available to borrowers with less-than-perfect credit scores; a welcomed relief to the stricter standards of today's lending market. First-time homebuyers are finding three bedroom homes in Oceanside and San Marcos, once priced at $550,000, marked down to $375,000. With the tax deductions and low interest rates, people are finding they can own a home for less than it would cost to rent at the same residence.
Townhomes and condos
For several years now, buyers have ignored townhomes and condos and opted to purchase the larger, more expensive single family homes. With fewer buyers purchasing townhomes, the average price for a Carlsbad condo that is 1,500 square feet or less fell from a high of $433,340 in 2004 to the current $370,000. But over the last 12 months, homebuyers are making more conservative buying decisions, opting for smaller homes with a less expensive monthly payment. A three bedroom Carlsbad condo in Rancho Carrillo was recently listed for $285,000, which is a big difference from the $400,000 asking price it could have commanded in 2005. With the new prices, attached homes have become attractive to both homebuyers and investors. With correct pricing, those who own attached homes should have an easier time selling this summer than compared to recent years.
Mortgage rates
Since 2006, mortgage rates have followed a trend of lowering through the winter months only to reverse and go up during the months leading into summer. Recently, 30-year fixed mortgage rates have risen to an average of 6.32 percent from an average of 5.48 percent in January of this year. Any sudden movement in rates cause stress in the marketplace. From May to June, interest rates jumped from 6 percent to 6.3 percent. If mortgage rates follow the same trend as previous years, we should see the rates move into the high 6 percent by the end of summer.
New construction
Today's buyers demand a functional property that provides the opportunity to take advantage of working from home. Residences that provide a separate home office or living quarters remain in high demand. High speed Internet enables a professional to telecommute to work from the comfort of their Carlsbad home. A casita, a small living area separate from the main residence that may have a full kitchen, is a rare find in Carlsbad. Buyer's also want the ability to have family, possibly retired parents, visit and stay without feeling like guests. Fiori of La Costa Ridge, a Warmington Homes development, recently sold out its popular development in La Costa. Two of the three floor plans had a retreat or detached casita, each with its own bath. According to the sales professionals at Fiori, the separate living areas were extremely popular with buyers and helped sell the first development in La Costa Ridge. If you are looking for a home with separate living quarters, venture over to Veridian, a Davidson home development in La Costa Greens. Veridian is currently in Phase 3 of 7 and is selling very well, despite the market slowdown. Two of its four floor plans have separate living areas with bathrooms. Visit the models for pricing and availability.