The current real estate market has turned positive with the help of restricted inventory and newly anxious homebuyers.
During the first six months of this year, Carlsbad had 357 single family home sales recorded in the Sandicor MLS. Looking back over a decade of home sales in Carlsbad, it has numerically been a very slow year for home sales.
The same time period in 2007 saw 512 homes sell, 495 sell in 2006 and 591 sell in 2004. You have to go back and check sales from 1997 to see numbers as low as the current real estate market.
But the number of sales relative to the number of homes available creates a competitive real estate market and the feeling that things are heating up. Since April, the supply of homes and townhomes less than $800,000 has steadily decreased.
Current inventory of homes for sale is around two to three months, meaning it would take that long to sell every home, which is extremely low. A normal Carlsbad market has between six to eight months of homes for sale. A slower market has 10 to 12 months.
The same phenomenon is happening in the townhome and condo market. The number of Carlsbad sales during the first six months of 2009 is comparatively low, 207 sales versus 508 during the same time period in 2004.
But there is only a two and a half month supply of condos for sale. With only a few available, buyers are making offers over the asking price just to secure the home.
Buyers are rushing for a reason. First-time buyers move quick to find a home before their $8,000 federal tax incentive ends in December.
Move-up buyers are in a hurry to lock in historically low mortgage rates that are around 5.5 percent. With the help of a newly positive national press (the recent Case-Shiller Home Price Index showing a small rise in home prices for example), buyers are seeing a bottom in the once dismal real estate market.
Not buying it
Housing bears believe more property will soon flood the market and drive prices down further. They point to shadow inventory, which is an unknown number of homeowners currently living in their homes but not paying their mortgage.
Since November of 2008, many lenders have halted the traditional foreclosure process, which records a Notice of Default when the borrower is delinquent. Without a public record of the default, it's difficult to gauge how many troubled homeowners will have their home for sale in the near future.
Many cry foul, stating that banks are artificially restricting supply, and even re-inflating the housing market. It's not clear why the banks would flood the market with property only to compete with themselves and drive down their own prices.
What of the traditional seller? Non-distressed homeowners have been reluctant to put their houses on the market at the lower price levels, further restricting the housing supply. The result is a slight upward price trend.
The average sale price for a three bedroom, three bath, 2,600-square-foot home in Carlsbad has moved upward from $680,000 in January to $713,800 in July. The average time to sell a single family home also has decreased to 56 days from more than 90.
Today's real estate market has a desperate feeling reminiscent of the boom years of 2004 and 2005. Multiple offers and above asking price bids have become commonplace.
But the buying activity is localized in the $800,000 and under price ranges in Carlsbad. The luxury market remains stagnant.
Homes priced more than $1 million have seen few sales; an average of only four home sales per month in 2009. This leaves roughly 36 months of luxury home inventory. A number that points to continued hardships in the luxury market.
For more information, contact Tyson Lund at (760) 438-0800 or [email protected].
During the first six months of this year, Carlsbad had 357 single family home sales recorded in the Sandicor MLS. Looking back over a decade of home sales in Carlsbad, it has numerically been a very slow year for home sales.
The same time period in 2007 saw 512 homes sell, 495 sell in 2006 and 591 sell in 2004. You have to go back and check sales from 1997 to see numbers as low as the current real estate market.
But the number of sales relative to the number of homes available creates a competitive real estate market and the feeling that things are heating up. Since April, the supply of homes and townhomes less than $800,000 has steadily decreased.
Current inventory of homes for sale is around two to three months, meaning it would take that long to sell every home, which is extremely low. A normal Carlsbad market has between six to eight months of homes for sale. A slower market has 10 to 12 months.
The same phenomenon is happening in the townhome and condo market. The number of Carlsbad sales during the first six months of 2009 is comparatively low, 207 sales versus 508 during the same time period in 2004.
But there is only a two and a half month supply of condos for sale. With only a few available, buyers are making offers over the asking price just to secure the home.
Buyers are rushing for a reason. First-time buyers move quick to find a home before their $8,000 federal tax incentive ends in December.
Move-up buyers are in a hurry to lock in historically low mortgage rates that are around 5.5 percent. With the help of a newly positive national press (the recent Case-Shiller Home Price Index showing a small rise in home prices for example), buyers are seeing a bottom in the once dismal real estate market.
Not buying it
Housing bears believe more property will soon flood the market and drive prices down further. They point to shadow inventory, which is an unknown number of homeowners currently living in their homes but not paying their mortgage.
Since November of 2008, many lenders have halted the traditional foreclosure process, which records a Notice of Default when the borrower is delinquent. Without a public record of the default, it's difficult to gauge how many troubled homeowners will have their home for sale in the near future.
Many cry foul, stating that banks are artificially restricting supply, and even re-inflating the housing market. It's not clear why the banks would flood the market with property only to compete with themselves and drive down their own prices.
What of the traditional seller? Non-distressed homeowners have been reluctant to put their houses on the market at the lower price levels, further restricting the housing supply. The result is a slight upward price trend.
The average sale price for a three bedroom, three bath, 2,600-square-foot home in Carlsbad has moved upward from $680,000 in January to $713,800 in July. The average time to sell a single family home also has decreased to 56 days from more than 90.
Today's real estate market has a desperate feeling reminiscent of the boom years of 2004 and 2005. Multiple offers and above asking price bids have become commonplace.
But the buying activity is localized in the $800,000 and under price ranges in Carlsbad. The luxury market remains stagnant.
Homes priced more than $1 million have seen few sales; an average of only four home sales per month in 2009. This leaves roughly 36 months of luxury home inventory. A number that points to continued hardships in the luxury market.
For more information, contact Tyson Lund at (760) 438-0800 or [email protected].