I’ve watched La Jolla closely for about five years now and I think it’s important to keep in mind that much of what you hear about less expensive areas just isn’t true in La Jolla. (While I haven’t followed Del Mar that closely, I think the situation is similar)
First, there are comparatively few short sales and even fewer REOs. Often those that do go this route are in poor condition or have issues. (Although there have been one or two really, really, expensive houses in trouble) But most sales are non-distress sales.
In general, the REOs or short sales aren’t going for much of a discount. There’s enough demand in La Jolla so that anything priced appropriately will sell quickly, and most of the short sales are priced above what I would consider them to be worth. Most lower their prices eventually. I’ve seen very few short sales where the listing was on the market and then went contingent in a couple of days. There have been a couple of places appear as contingent for amazing prices, but I haven’t seen them close, and I suspect they are insider deals. Not sure how you get in on an “insider deal” and who’s palm you gotta grease to get there.
Lastly, I’ll point out that many of the “deals” that seem to happen aren’t short sales or REOs. Instead they are owners who have owned the house for a long time and for whatever reason want to sell. Because they don’t owe a ton, they can sell and still come out ahead, so they price to sell.
Not sure how helpful these comments are, but hopefully somewhat.
