price collapse in Chula Vista

[sdrealtor]

Peak price was probably about $925,000. Early 2002 Price was around 600,000. 50% off peak would be about late 90’s purchase price with pre-move in upgrades and landscaping costs. If it hit that price, an investor could buy it with 20% down and would be cash flow positive on rental by several hundred dollars per month.

cashflow,
if it comes to pass, unfortunately it is not small.

[sdrealtor]

Peak price was probably about $925,000. Early 2002 Price was around 600,000. 50% off peak would be about late 90’s purchase price with pre-move in upgrades and landscaping costs. If it hit that price, an investor could buy it with 20% down and would be cash flow positive on rental by several hundred dollars per month.

cashflow,
if it comes to pass, unfortunately it is not small.

[sdrealtor]

Peak price was probably about $925,000. Early 2002 Price was around 600,000. 50% off peak would be about late 90’s purchase price with pre-move in upgrades and landscaping costs. If it hit that price, an investor could buy it with 20% down and would be cash flow positive on rental by several hundred dollars per month.

cashflow,
if it comes to pass, unfortunately it is not small.

[Ex-SD]

Re. Encinitas: I agree with both SD Realtor and sdrealtor. I think that unemployment is going to get a lot higher in CA and that the foreclosures will continue to grow but Encinitas is likely to be an area that will not suffer as badly as others. I’m guessing 30%-40% drops from peak prices in the Encinitas area while many other areas will see 50%+ drops. I guess we’ll just have to wait and see where this goes over the next 4-5 years.

[Ex-SD]

Re. Encinitas: I agree with both SD Realtor and sdrealtor. I think that unemployment is going to get a lot higher in CA and that the foreclosures will continue to grow but Encinitas is likely to be an area that will not suffer as badly as others. I’m guessing 30%-40% drops from peak prices in the Encinitas area while many other areas will see 50%+ drops. I guess we’ll just have to wait and see where this goes over the next 4-5 years.

[Ex-SD]

Re. Encinitas: I agree with both SD Realtor and sdrealtor. I think that unemployment is going to get a lot higher in CA and that the foreclosures will continue to grow but Encinitas is likely to be an area that will not suffer as badly as others. I’m guessing 30%-40% drops from peak prices in the Encinitas area while many other areas will see 50%+ drops. I guess we’ll just have to wait and see where this goes over the next 4-5 years.

[Ex-SD]

Re. Encinitas: I agree with both SD Realtor and sdrealtor. I think that unemployment is going to get a lot higher in CA and that the foreclosures will continue to grow but Encinitas is likely to be an area that will not suffer as badly as others. I’m guessing 30%-40% drops from peak prices in the Encinitas area while many other areas will see 50%+ drops. I guess we’ll just have to wait and see where this goes over the next 4-5 years.

[Ex-SD]

Re. Encinitas: I agree with both SD Realtor and sdrealtor. I think that unemployment is going to get a lot higher in CA and that the foreclosures will continue to grow but Encinitas is likely to be an area that will not suffer as badly as others. I’m guessing 30%-40% drops from peak prices in the Encinitas area while many other areas will see 50%+ drops. I guess we’ll just have to wait and see where this goes over the next 4-5 years.

[recordsclerk]

Encinitas will not drop as much from peak as Chula Vista because of the housing stock. Most of Chula Vista east of 805 was built after 2000 and a large percentage of homes were built and sold during the height of the market leading to large amounts of forclosure inventory. This must sell inventory just feeds upon it’s self creating more price adjustments and further downward pressure. As prices drop beyound the 30% percent mark, some people that are able to pay their mortages just decided to let the home go into forclosure because they don’t want to pay on a house the is worth 30%+ less then what they owe. At some point these price drops will make their way up to nicer areas, but won’t have the forclosure fuel to create these kinds of price drops. Encinitas will see further price pressure and will have a delayed effect since there isn’t enough must sell inventory. Like Bugs has said before, everything is interconnected and it’s finally starting to show in sales. It’s like what Rich said about the areas that have declined the most are seeing more sales, while areas that are holding strong are seeing fewer sales. So at some point the nicer areas are going to feel the pain. It’s just hard to guess how much and when.

[recordsclerk]

Encinitas will not drop as much from peak as Chula Vista because of the housing stock. Most of Chula Vista east of 805 was built after 2000 and a large percentage of homes were built and sold during the height of the market leading to large amounts of forclosure inventory. This must sell inventory just feeds upon it’s self creating more price adjustments and further downward pressure. As prices drop beyound the 30% percent mark, some people that are able to pay their mortages just decided to let the home go into forclosure because they don’t want to pay on a house the is worth 30%+ less then what they owe. At some point these price drops will make their way up to nicer areas, but won’t have the forclosure fuel to create these kinds of price drops. Encinitas will see further price pressure and will have a delayed effect since there isn’t enough must sell inventory. Like Bugs has said before, everything is interconnected and it’s finally starting to show in sales. It’s like what Rich said about the areas that have declined the most are seeing more sales, while areas that are holding strong are seeing fewer sales. So at some point the nicer areas are going to feel the pain. It’s just hard to guess how much and when.

[recordsclerk]

Encinitas will not drop as much from peak as Chula Vista because of the housing stock. Most of Chula Vista east of 805 was built after 2000 and a large percentage of homes were built and sold during the height of the market leading to large amounts of forclosure inventory. This must sell inventory just feeds upon it’s self creating more price adjustments and further downward pressure. As prices drop beyound the 30% percent mark, some people that are able to pay their mortages just decided to let the home go into forclosure because they don’t want to pay on a house the is worth 30%+ less then what they owe. At some point these price drops will make their way up to nicer areas, but won’t have the forclosure fuel to create these kinds of price drops. Encinitas will see further price pressure and will have a delayed effect since there isn’t enough must sell inventory. Like Bugs has said before, everything is interconnected and it’s finally starting to show in sales. It’s like what Rich said about the areas that have declined the most are seeing more sales, while areas that are holding strong are seeing fewer sales. So at some point the nicer areas are going to feel the pain. It’s just hard to guess how much and when.

[recordsclerk]

Encinitas will not drop as much from peak as Chula Vista because of the housing stock. Most of Chula Vista east of 805 was built after 2000 and a large percentage of homes were built and sold during the height of the market leading to large amounts of forclosure inventory. This must sell inventory just feeds upon it’s self creating more price adjustments and further downward pressure. As prices drop beyound the 30% percent mark, some people that are able to pay their mortages just decided to let the home go into forclosure because they don’t want to pay on a house the is worth 30%+ less then what they owe. At some point these price drops will make their way up to nicer areas, but won’t have the forclosure fuel to create these kinds of price drops. Encinitas will see further price pressure and will have a delayed effect since there isn’t enough must sell inventory. Like Bugs has said before, everything is interconnected and it’s finally starting to show in sales. It’s like what Rich said about the areas that have declined the most are seeing more sales, while areas that are holding strong are seeing fewer sales. So at some point the nicer areas are going to feel the pain. It’s just hard to guess how much and when.

[recordsclerk]

Encinitas will not drop as much from peak as Chula Vista because of the housing stock. Most of Chula Vista east of 805 was built after 2000 and a large percentage of homes were built and sold during the height of the market leading to large amounts of forclosure inventory. This must sell inventory just feeds upon it’s self creating more price adjustments and further downward pressure. As prices drop beyound the 30% percent mark, some people that are able to pay their mortages just decided to let the home go into forclosure because they don’t want to pay on a house the is worth 30%+ less then what they owe. At some point these price drops will make their way up to nicer areas, but won’t have the forclosure fuel to create these kinds of price drops. Encinitas will see further price pressure and will have a delayed effect since there isn’t enough must sell inventory. Like Bugs has said before, everything is interconnected and it’s finally starting to show in sales. It’s like what Rich said about the areas that have declined the most are seeing more sales, while areas that are holding strong are seeing fewer sales. So at some point the nicer areas are going to feel the pain. It’s just hard to guess how much and when.

[Eugene]

Did some more research on Quintessa.

Their plan is to sell 98 homes. Out of 98, 55 have been definitively sold; 3 appear to be finished but I can’t find any records of their sales; 6 are being built right now; 3 are models; and the remaining 31 lots are empty.

Most houses were sold during ’06. I only see two original sales since August ’07. Either they suddenly ran out of buyers, or online records are updated with serious time lag (or maybe both).

Overall Quintessa looks “frozen”. There’s not much distress: 3 NODs, one guy behind on his property taxes, and one REO. One house is listed for sale for 1199k (good luck with that).

Median prices paid are 1100k for plan 1, 1200k for plan 2, and 1300k for plan 3.

Castillian next door is a lot more interesting. (I wonder why: they were selling at the same time) I see 8 defaults, 3 REOs, 2 short sales, and 5 knife-catchers. All this distress is causing major downward price pressure on the whole neighborhood. That’s probably why McMillin is introducing new smaller plans – it must be hard to compete with all the distressed 4000 sf inventory, so they are exploring a new niche.

Current median market value in the neighborhood seems to be around 800k. We’re almost through the spring bounce and I expect a second round of declines to begin shortly.

[Eugene]

Did some more research on Quintessa.

Their plan is to sell 98 homes. Out of 98, 55 have been definitively sold; 3 appear to be finished but I can’t find any records of their sales; 6 are being built right now; 3 are models; and the remaining 31 lots are empty.

Most houses were sold during ’06. I only see two original sales since August ’07. Either they suddenly ran out of buyers, or online records are updated with serious time lag (or maybe both).

Overall Quintessa looks “frozen”. There’s not much distress: 3 NODs, one guy behind on his property taxes, and one REO. One house is listed for sale for 1199k (good luck with that).

Median prices paid are 1100k for plan 1, 1200k for plan 2, and 1300k for plan 3.

Castillian next door is a lot more interesting. (I wonder why: they were selling at the same time) I see 8 defaults, 3 REOs, 2 short sales, and 5 knife-catchers. All this distress is causing major downward price pressure on the whole neighborhood. That’s probably why McMillin is introducing new smaller plans – it must be hard to compete with all the distressed 4000 sf inventory, so they are exploring a new niche.

Current median market value in the neighborhood seems to be around 800k. We’re almost through the spring bounce and I expect a second round of declines to begin shortly.

[Author]

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