San Diego Housing Market News and Analysis

Excellent community. Access to sage canyon :)

Has HOA nazi's....Though if you like your neighbhorhood kempt, it's not such a bad thing.

We lived in Steeplechase for the last 5 years. The houses are smaller than most of the surrounding houses (Steeplechase 2200-2600, Belmont 2700-3700, Lexington 3700-4600). Palacio Del Mar is mostly similar sized, with some smaller. So I'm not sure I'd call Steeplechase large.

They've held their value as well as most of Carmel Valley, which is to say quite well, and I don't see any reason that should be different in the future.

They are a bit old for this part of Carmel Valley (mostly 10-13 years old). The house we lived in was constructed like any other Pardee home. Which is to say the construction was mediocre. Pardee saved a nickel anywhere they could.

Sage Canyon is a great school. The neighborhood is very nice with tons of families. We liked the location. Easy freeway access with no freeway noise. Great weather in the summer (low to mid '70s most of the time). Near the beach. Near shopping.

All in all, we loved living there. As I said in a previous post, I think Scripps Ranch is a real sweet spot. The weather isn't too hot, there are lots of families, the schools are good, and the houses are less expensive than CV. If you want to pay 15% more for slightly better schools, 8-10 degree cooler weather in the summer, a shorter drive to the beach, and, depending where you work, maybe a shorter commute, then Carmel Valley is a good spot for you.

Neither CV or SR has "character." If you want character, you might check out Encinitas.

I think Scripps has some character. Not as much in the geography as in some of the neighborhoods. I think in terms of family orientation Scripps is a fantastic place. I would imagine CV is as well but have not lived there. However with Scripps where we have lived we found alot of great stuff with neighbors and families.

Palacio blows....

By character I mean a unique atmosphere. Scripps Ranch and Carmel Valley differ from your run-of-the-mill suburban California neighborhoods in the slightest, most uninteresting ways, in my opinion.

That being said, as a place to raise a family, I like your run-of-the-mill suburban California neighborhood. We've found great stuff with neighbors and families, too. But, apart from maybe the Penasquitos Canyon and our proximity to the beach, there's very little that separates it from most other California suburban areas.

It seems like price has not dropped that much for steeplechase. Do u think they will continue to hold their value or do u see them drop another 5-10%? Also does it make sense the ones with the canyon views hold values much better than the ones w/o the views? We are interested in the area but want to know if this is still one of the "overvalued" area of SD.
Thanks!

There was a $799k short sale there I think...

I wrote (only about a quarter jokingly) in a previous post (in May - http://piggington.com/i_finally_bought_a... )that, now that I'd bought a house, I thought that prices would head down. Here were my reasons then:
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1. Shadow inventory
2. Unemployment
3. Limited supply of Asians willing to pay anything for good schools (like my wife).
4. Interest rates almost have to go up from here.
5. End of tax rebates (Fed recently, CA soon).
6. Fall/Winter
7-9. A few more I can't think of right this second.
10. MAINLY, because, after 5 years of waiting for CV prices to fall, I gave up and bought.
I'd have actually preferred to wait, but this lot was so fantastic and unique, I didn't want to pass it up.
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I gave up guessing how much the government will do and how much effect it will have. I'm a little less bearish on CV now than I was then. Prices seem to be holding pretty steady so far. But that doesn't necessarily mean they'll continue to hold. So, I don't know. But if they do continue to decline, I think it will probably be slowly and not by much. I waited five freaking years and they dropped very little in that time.

It's a tough call. I mean, if you knew for sure they'd drop a total of 8% over the next three years, that'd probably be worth it. You'd save $70,000 or $80,000. But that's probably the max it would drop. It might not drop at all. Then you've waited for nothing. If they go up (unlikely but possible), now you're probably angry.

At the time (in May), if it weren't for that one house that we wanted, I'd have waited. Now, with prices holding almost steady for yet another year, I'm not so confident that they'll continue down. In my opinion, CV is still one of the "overvalued" areas of San Diego. But that doesn't necessarily mean that prices will come down.

http://piggington.com/mortgages_look_to_...

For the last 5 years, it seems like every week an article like this would come out. Not on mortgages, specifically, but on something that would have a drastic effect on the housing market. Every time I'd read something like this, I'd think, "here it comes!" But, for Carmel Valley, anyway, it just never happened.

Of course, that doesn't mean it won't now.

I agree with all of your posts zk. I think it is one of those, "to each his own". For our family I found value in Scripps for a bit less then CV and the family atmosphere works for us. Now taste wise my wife would rather be a bit more rural into Poway. Anyways I agree with you, I think they are very similar, there are some parts about Scripps I like alot that CV doesn't have. However I hate the commute down Pomerado with a passion!

Yes, to each his own. I really like Scripps Ranch and I think you get better value there.

Here's one thing about Carmel Valley that I find interesting (and good). In Scripps Ranch (we lived there for almost 5 years), if you have a million dollar house, you're king of the hill. And some of the people there would act pretty uppity about it. (Not most or even a lot, but some.) Their Escalade and their McMansion and they were hot stuff. Pretty annoying, really. In Carmel Valley, there are $3 and $4 million dollar houses right up the street. The kids of the would-be-uppity go to school with truly rich people. They meet and hang out with these people. They realize their Escalade and their million-dollar house put them way, way below the summit of the local mountain. And suddenly they're not so uppity anymore. And the rich are rich enough to not have to be uppity. The ones we know are, without exception, humble. So there is, almost paradoxically, less "keeping up with the Joneses" here than you find in a lot of upper-middle class neighborhoods. Which is nice.

What I love about Carmel valley is seeing all the bald 50ish men walking around with their 30 something girlfriend and/or wife with the 2-3 year old toddler sealing the deal...who also btw drive like shit, no matter what they drive.Lol it's hysterical

One time I ran into some old guy, and saw the baby in the stroller. I accidentally, said "what a beautiful grand daughter" to the man and said "you and your dad must be proud" to the woman. She immediately corrected me "yes, my husband and I are very happy.".....

Oops... I guess one never knows

Thanks guys for sharing your comments.
We'll see if we find something we like with a good price then.

Deleted

You missed it

http://www.sdlookup.com/MLS-100062752-10...

And my what a difference a short sales makes

http://www.sdlookup.com/MLS-100049661-10...

Good luck to contestant 3
http://www.sdlookup.com/MLS-100071915-10...

$415/sqft! That's some good crack they are smoking

Good crack? Contestant number two got $412/sf for the same model house two doors down from contestant number 3. Contestant number 3 is asking for an additional $3/sf.

Sounds like Sudafed at best.

Yah...we were looking into these ones and I wonder why did one just sell for $810K. So confirmed this is a short-sale huh. The interior pic showed that the house is not in such a condition cosmetically inside. Also the other two that are asking for >$1M face the canyon while the short-sale property faced a neighbor.

Given this difference...flu and sdrealtor: do you think contestant 2 and 3 are asking rediculous price? I wonder if canyon view help sell faster or not.

Any thought would be greatly appreciated.

Another thing:

When looking at SFHs, do you think for long-term investment purpose (>10~15-years), is it better to buy a SFH in the $800K range now or is it better to buy something in the sub/close to $1M range?

The $1M house with view seems like a much better deal than $800K in a smaller neighborhood...but I don't know if it's a wiser decision for long-term resale values.

For people coming into CV, is it much easier to sell $700~$800K homes or the $1M homes?

$400/sqft+ imho for something 2600/sqft medium size home imho is ridiculous in Carmel Valley... So, yes I feel that contestant #2 totally overpaid and/or got ripped off. I mean, we're not talking it's del mar mesa. This is not a "professional" opinion. sdrealtor and sdr probably have more unbiased viewpoints... But I am biased, because in my mind, even at the height, $350/sqft seems about reasonable.

You know though. To be honest, just looking at SDlookup's the inventory for homes between 800k-1million imho looks, lousy....It looks almost as bad as in 2004....

Hi Flu what do you mean by the inventory looking lousy almost as bad as in 2004?
Do you mean that in 2004 houses were selling fast so there're barely any good inventory left?

How much more would you pay for something that has a unobstructed canyon view compared to a standard spacious backyard/pool? How do people evaluate how much a "view" is worth?

The key here is, "in my mind...seems."

$350 seems reasonable in my mind, too. But that's not what they're selling for. That's not what they sold for at the height, either.

I agree that the contestant number 2 got a lot for his house. I was surpised he got that much. That does kind of seem like peak pricing. It reminds me of 5880 Great Meadow in Saratoga. It was a foreclosure for sale this summer. Nice house, about 2700 sf, big lot, on a canyon, with a pool and spa. We offered a million on it, figuring it might get a million fifty. Some joker bid $1,180,000. I'd bet the second highest bid was a hundred grand less than that.

In any case, that's what they're selling for right now. There's a limited supply of canyon-backing homes, and when they come on the market, there's people who want them and will pay for them.

The last low point came in 2009. 5001 Manor Ridge was a 2700 sf Belmont on the canyon. No upgrades, ordinary lot. Sold for $925k. You can't find that now. So prices have definitely gone up since then. Will they go back down there? Maybe. Maybe not. Who knows, really?

Wow ZK you really know the area very well!
I read on the forum that you finally bought something last year. Did you look into this area of CV for a long while and you finally bought something you like cuz the price just never dropped to what you had wanted?

Yah...canyon-back homes. We love that feature but don't know if that's the only reason why they're selling far more than the ones without the few. I guess the limited supply.

Well, zk. Here's the thing. I don't disagree that homes are selling at this price...It's just seems crazy.. I'm looking at all the SDlookup listings for 92130 in the price range between $800k to $1million. I don't recall even in 2004, many situations in which 2600-3000sqft homes where commanding $400+/sqft even when inventory was tight and had multiple offers on them. And we're supppose to be in an economy slump now where there is significantly more foreclosures/short sales/etc. So it's really hard for me to understand...

You're asking the wrong person here about view. Because I laugh at what they call "view" in Carmel Valley. I grew up spoiled, because my parent's home in so cal, have ocean "view" in the sense that you have end to end home ocean view...Not the "view" that homes define here, which is like you have ocean view if you look out of the upstairs bathroom window and see 3 inches of ocean.

In 2004, it wasn't peak. But homes were snatched up pretty quickly with multiple counters...But even so, I don't recall seeing tract homes in this 2600-3000sqft range commanding $400/sqft....or maybe they were but I just didn't bid on those....

We've lived in CV for about 9 years. From Feb '05 until late 2010, we were renting and watching the market. We watched every house that came on the market and every house that sold, paying particular attention to Carmel Country Highlands (which is Steeplechase, Belmont, and Lexington). So yes, I know the area very well.

We owned from 2002-2005 and rented after that. We knew we wanted to stay in CV and we were hoping the market would drop. Since about 2007, we'd been on the "list" at Bridle Ridge (a new home community in Carmel Country Highlands), and that was always another option (besides buying an existing home). There was one lot in particular that we loved. When that home was finally for sale (in May 2010), we had the option of buying it or passing on it. It seemed pretty obvious that the market was at a government-incentive-induced mini peak, and that prices would go down after that. And that sort of did happen. But what was less knowable was how much the drop would be after the effect of the incentives wore off. As it turns out, it has dropped less than I expected so far. "So far" could be the key phrase here. We'll see. In any case, that's all sort of background so that I can answer your question. And the answer is that we bought this house because the lot is spectacular and unique and we really love it (and we only had one chance at it and that chance was in May '10). Not because we didn't think prices would drop further. If it weren't for this house coming up for sale, we'd have waited.

As it turns out, prices didn't drop that much, and here in Spring '11 they seem to be kind of back near where they were in Spring '10 . It's kind of like after the peak in '05. You had some houses go for peak pricing, and some go for less. You have to be careful that you're not one who pays peak prices now that we're not at the peak. I saw some sales over the past 5 years and I just had to think, "wow, that buyer's realtor is not doing anything for them. There are 2 houses on the market better than that that they could've gotten for a hundred grand less." I'd been in the houses, and in the comp houses, and they just plain paid too much.

One way to prevent that is to know the market. Our realtor had an automated set up where we got an email for every house that came on the market, changed price, was cancelled or withdrawn, went pending and sold. Any realtor can do that for you, and you should have yours do it for you if he isn't already. Check some of the houses out. Notice what they sell for. Know the neighborhood. Of course, if you're looking in lots of different neighborhoods, that can be difficult to do. But if you know the neighborhood well, you can avoid paying more than you should.

Now, with canyon-backed houses, it's a little different. There really is a limited supply of those in this part of town. And, flu's self-admittedly spoiled perspective notwithstanding, it does give you a nice view and a nice, open feeling, and a feeling of serenity that comes from being right on the edge of so much natural land. There are lots of people who want to live in this area and who want to live on the canyon. And they just don't come up for sale that often (relative to the number of buyers for them). So there's your supply and demand situation. Except for a brief period in '09, which was a pretty good window to buy, that situation has held fairly steady.

As for the whole $400/sf discussion, 2500-2600 sf homes on the canyon did sell for $400/sf and more at the peak. And they've sold intermittently at that price since the peak. 3100-3500sf homes on the canyon generally sold for $370-$380/sf at the peak and intermittently since then.

As far as whether the canyon is the only reason they're selling for far more than the ones without it... There's always other variables. The one on Cloverhurst that sold for 810 is very dark - the back faces northeast and it backs up to a higher neighbor behind. And it has a back yard crammed with a pool. So in addition to a lack of view there's privacy, light, and backyard issues. There's always something. But, that said, 810k was fairly cheap for that and 1070k was pretty high for the other one. So you've got a not-on-the-canyon, not-super-nice home at a price that's low even considering the problems, and an on-the-canyon house, which is a nice house with a big yard, at a price that's high, even for such a nice house. Point being, the spread between canyon and not canyon is not usually that big.

Anyway, it's a real nice area and I hope you find something you like. I'd be happy to try to answer any other questions you have. Good luck.

The dip in '09 came in the summer. I wouldn't be too surprised to see a similar dip this summer. If you're not in a hurry, you might consider waiting until after the spring buying season ends. That's probably something to consider in any market except one that's shooting up relentlessly, which this one obviously isn't. Of course, the buying season is also the selling season. Meaning that you might face lower inventory (less to choose from) later in the year.

So many variables, so much to consider. Again, good luck.

Hi Zk,
Thanks for sharing all the info.
So for canyon-backing homes, do you think I should not expect to get a "steal" unless I get real lucky? If a shortsale house (with the things you described about the house) sold for $810K, do you think the canyon-back homes should be only in the $900~$950K region as the seller is asking way more than $1M. Hopefully can hear from you what you think in terms of valuation.

I've seen a few houses in CV that asked for $1.08~$1.1M that sold for about at least 5~10% less than asking price. Do you think in this case, a $1M price tag from $1.08M would be reasonable?

thanks.

Oh in response to flu's comment about views...hm......I think most ppl cannot afford full-on ocean views and I agree in Carmel Country you cannot get that. But a canyon view is better than no view.

The only canyon-backing homes that went for those prices were in summer '09. One went for 925k and a couple more went between 950k and 1M. In my opinion, the only way you'll get one is if the market does the same thing this summer (or in the future) that it did in '09. I don't think the one on Cloverhurst asking 1079k will go for less than 1M at best. It could easily go for more than that, though. Couldn't hurt to throw an offer in, though. You really never know.

Would you say the housing market in CV now is still relatively slow-moving? Doesn't seem that there're lots of actions.

Do most buyers come in more towards summer?