San Diego Housing Bubble News and Analysis

They are moving forward. here is the latest update I got.

"We have already framed our Rockledge and Copperwood models and they are turning out great! We anticipate opening in April and May. SolTerra is shortly behind them with models starting in March, opening in late Summer 2009."

SOl terra is LC Greens

For the uninitiated, whats the difference between Oaks and Greens?
Josh

school districts!!!!

Went through the Model Homes yesterday just to see what's shaking at Copperwood - Bottom line: the homes are nice, but I suspect that they are going to have a hard time selling them in this economy. The signs on Rancho Santa Fe say "Homes from the low 600's", but the three model homes that they have open for viewing are in the Copperwood sub-division which is going to have 53 homes, with prices in the high 700s to mid-800s. ( the Rockledge subdivison is the one that is going to have the homes in the 600's, on the other side of RSF, and slightly south and closer to RSF than SEH. ) I heard alot of people walking though the models stating "These sure are nice - now, where are the homes in the 6's ?" The good news is that they are in San Diguieto / Encinitas School district ( at least they say they are - I thought that the boundary line ran along the golf course - I wonder if this is going to be the case for the Rockledge homes on the other side of the street - logic would dictate that those would be in San Marcos SD ? )

Here is the info on the homes that we saw:

Model 1A - 3,260 sq ft, 800K
Model 1CR - 3,438 sq ft. - 810,490 ( NOTE: they Converted the third garage into a free-standing BR / Bath / guest house deal)
Model 1BR - 3,260/ 757,490
Model 2B - 3,511 / 787,490
Model 3B - 3,688 / 849,490

All of the models are on the Northern Edge of the property ( i.e. with nice views out to the Batiquitos, and away from the high voltage powerlines - those lines are really close to the southern edge of the property and would cause me to not be interested in a house on that side )

Nice homes, but I have to wonder what this does for the homes that are currently for sale in LCO - I see approx 13 homes there with prices ranging from 849 to 1.375, average around 900K - Why would someone buy one of those when they can get a brand new home in the same subdivision for 100 - 500K less ????)

All in all, I think the bottom is about to drop out and a lot of people are going to be surprised when these "million dollar homes" are going to sell for no more than the FHA limit - IMNSHO ...

Regards,
RT

There are always buyers looking for new homes. These are the only and probably last new homes to be available in this part of the San Dieguito school district on a large scale. Dont kid youself into thinking there arent lots of folks out there making alot more money than you, who already have alot more money, who will inherit money and so on to buy these. They will release them slowly, build only what they sell and have no trouble selling them IMO. It may take a while but dont expect these to languish or sell for bargain basement prices.

I'd be willing to wager a tall frosty mug (of my/your choice) that the builder goes belly-up before the subdivision is completed (i.e. all homes sold and new pool is completed ) - At the end of the day I just don't believe that there is a big pool of people out there making 300 large a year that are ready, willing, and able to buy a 900k house in our little neck of the woods.

Time will tell ... ( it always does )

Peace,
RT

I have been working with them (Colrich) on behalf of a client as well. I would tend to agree with what sdr said. The releases they are doing are very small in number. I agree that the pricing is out of line. I could not agree more but in this particular market it is really challenging for buyers right now.

I have been saying what he said above for a long long time.

Don't generalize and try to predict what "others" have to spend. It is a useless exercise. Focus on your own resources and accept that others have more then you and may or may not choose to buy what you don't want to or cannot afford. This is not meant to slam anyone, it is simply trying to point out the correct mindset in analyzing the market.

WCN
There are plenty to buy a few dozen homes which is all they are building. You are very myopic if you dont beleive there are hundreds of families in a county of 4,000,000 people that can and would love to buy a beautiful new home with an ocean view a couple miles from the beach in one of the premier school districts around.

I'll ammend your statement for you to be more accurate.

Time will tell....that sdr is right again (it always does)

Cheers

sdr

sdr

Over-rated school district for the premium.
It continues to crack me up that people are willing to pay $200K more for LCO vs. SEH due to zip code and school district. For goodness sakes, they are right accross the freakin street from each other!

Compare the LCO schools to SEH schools as ranked by greatschools.net (10 pt scale):

Elementary:
Mission Estancia - 10 (930 API)
SEH - 9 (898 API)

Middle:
Diegueno - 9 (872 API)
SEH - 9 (851 API)

High:
LCC - 8 (805 API)
SMH - 8 (773 API)

Even funnier are the folks who pay $150K more for LCR...they get the same schools but I guess the 92009 is where the real value is.

wfb
You are not so naive to think that the premium of whatever it is represents schools alone? How about MR that are several thousand dollars less a year? How about an HOA that gets you country club quality recreation facilities instead of a town square with a fountain? How about access to city owned golf course? How about a drive to work that is 10 to 15 minutes shorter each way? How about nearby access to shopping, beaches, health care, restaurants and more?

My children are in the EUSD. I will give you that the scores are close BUT the scores aren't what make those schools great. The parent involvement at those schools is unreal. A teacher could sneeze and there are parents lined up to offer tissue.

I have contemplated SEH but to be honest I don't want my kids at SMHS and I don't want them in private school. Sounds snooty but I know for a fact that there are many people like me who will pay the premium.

Let's See:
MR = ~$200/mth higher or $35K home value. Point to sdr.

HOA = LCO and LCR with 'country club' quality? I'll give you LCV for sure, but LCO and LCR have a gate and an exercise bike for their $300/month. Point to wfb.

Drive to work - You assume everyone drives to the 5. I don't. My neighbors don't. My 2,000 co-workers don't. LCO and SEH are the same distance to my work. Point to wfb.

SEH isn't near shopping, beaches, health care, etc.? OK, 10-15 minutes further than LCO. Point to sdr.

I've evaluated this extensively over the past two years. I really can't justify paying a $200K premium for LCR or LCO.

Totally agree with your POV. My kids are young enough that I've got 10 years to let the SMHS situation play out.

WFB
The MR is $300 higher.

The HOA's in LCO,LCR and LCG are closer to 200. The facility at LCG is the finest i have seen anywhere. LCO is much more than a gate and an bike.

Hey kettle, you just assumed everyone doesnt drive to work. Also the drive isnt just to work. Its to absolutely everywhere you need to go.

Make sure to include tyhe A/C bill as it is much hotter up in SEH.

Bottom line-if you dont see the value dont pay it. Many see the value and do pay it.

But back to the point I made. The premium is not for schools alone and is much more than that. Sorry gotta walk to get my kids from school and then walk over to Coldstone and The Apple Store. I can do that in 5 minutes. Its a 5 hour walk from SEH.

MR depends on the house. Average is $200 higher, you can't just count the high ones.

A/C bill? That is ubsurd. I had that debate with a friend who lives in LCR this past weekend. We used the same therm at each house - it was 1 degree warmer in SEH.

You're right - they can go ahead and pay extra for the 'value' - to each his own. I'll just retire a few years earlier than they will - and my kids will get in to the same universities as theirs.

WFB
I think you missed your opportunity to score your biggest point. The premium is currently much higher than $200K when you compare apples to apples homewise. SEH prices have come down far more and far faster than LCO.

Thats your real point.

Thanks - that really is my point. I just got distracted by the school argument which is a hot button for me - people hold up Enc/San Deg. on a pedastal even though the data shows otherwise.

Call me in July and we can compare thermometers;)

For me the $200,000 difference= save 10 minutes on driving, zip code pride, and a "better high school"

The last two don't apply to me. Everything else is a wash.

Are there are moments when I would like to save the 10 minutes of driving? Yes! But not enough to have a mortgage that size.

We decided that traveling and saving are more important to us. We are heading to Costa Rica and Brazil this summer instead of looking at overpriced houses. It will take us 10 more minutes to the airport but we can afford to do things like that when we have affordable housing.

I hope people will view LCO and LCG as superior so we have fewer competitors when we make offers.

When I went through the LCO model homes they told me it was San Marcos school district? Is that correct?

The information I received from ColRich said it was San Dieguito but I am not 100% certain.

They are definitely in San Dieguito - Link to the boundary map is attached ....

http://www.sduhsd.k12.ca.us/assets/pdfs/...

- WCN

How can you tell with that map? Looks close to me.

Cmon WFB. Dont worry about it. Its always a good time to buy real estate;)

I actually am getting pretty close....

Anyone else been following sales in the 2 new Colrich developments in La Costa Oaks? Copperwood and Rockledge have both released Phase 2 and seems they are selling well.

To the person that said the prices are out of line, in your opinion what do you think they should be.. Is the builder flexible and how is the quality?
Any info would be appreciated...
Thxs

I think the proof is in the rate in which they are selling. In what I've seen and my research, they are priced slightly less per sqft then other existing resell homes in La costa oaks. I bought across the street in Rockledge, which is more in my size/price range and I love the views/privacy on the rockledge side, but Copperwood homes are bigger and cost less per ft.

Long time since there was a comment on this, but finally you have someone who bought at Copperwood in here. I bought one of the phase 1 homes in Aug/Sept '09. I'm happy, house is great, service from ColRich has been good.

I'm comfortable with the pricing. Who knows what the summer will bring, but there's a reasonable chance that the housing will have a slower than usual recovery while excess inventory is slowly worked out of the system. Copperwood compares pretty well with the other house listings, so about even on the underlying final sale price.

Financing is certainly a problem for some; we were the 3rd buyer of this house because two others couldn't get the finance in place. Phase 2 has one or two houses yet to close, I think they have buyers lined up, but we were not the only onces who had to wait while others tried to deal with their unrealistic loan expectations. There are a couple of Phase 4 houses (the west facing lots) yet to sell, but then again they are only being framed at the moment.

I was over at the ColRich SolTerre (I think that's what its called) the other day and they seem to be selling them almost as quickly as they can be built.

We bought in Phase 1 across Rancho Santa Fe in Rockledge (the smaller homes) We're very happy. Lots of great views of the canyon out the back and ocean/lagoon out the side and front. We have only 1 neighbor, so privacy is great. The lot is pretty small though. Colrich has been pretty good with repairs as they come up. I stop by the sales office once in a while and they are doing well. 27 of 33 sold since they opened in June 09. Prices are slightly up from Phase 1 to Phase 4, but nothing significant... maybe 5-15K.