Here’s our new listing in Starboard by Davidson Communities – San Diego’s best builder!
7618 Circulo Sequoia, Carlsbad
5 br/3.5 ba, 4,000sf
15,314sf private corner lot
LP = $2,500,000
Davidson’s Starboard neighborhood is known to be among the finest in Carlsbad, and for most the Residence Two is the favorite floor plan. Its 4,000sf surrounds the private 700sf courtyard which extends the indoor/outdoor living area all on a whopping 15,314sf lot.
Five larger bedrooms include a bedroom/full bath suite downstairs which is sequestered off by itself for maximum privacy. The lushly landscaped backyard is a tropical oasis waiting to provide the new owners the perfect place to relax and enjoy the good life, plus it’s just a short walk to the community clubhouse, Olympic-sized pool, and fitness center. Hardwoods, stainless, dozens of big windows for plenty of natural light, four fireplaces, 3-car garage, and dual-zone central A/C.
Either walk the dog around the neighborhood’s 1.2-mile loop or hike/bike the miles of trails nearby! Top-rated Encinitas schools too – wow! If you are looking for an upscale luxury experience that matches your active lifestyle, check this out!
Davidson homes tend to sell for a premium – 7302 Calle Pera closed for $3,025,000 on 9/19! Other comps include 6643 Halite that closed for $2,925,000 on Aug 30th…6626 Halite that closed for $2,475,000 on Aug 30th….7290 Sitio Lima closed for $2,580,000 on 5/23/24 (backed to RSF Rd.)…smaller 7558 Circulo Sequoia on a smaller lot closed for $2,444,000 on 7/3/24…..3056 Via Romaza 3,174sf closed for $2,700,000 on May 28th.
For two months we’ve been settling in with the new arrangements for paying the buyer-agents.
I haven’t heard of any buyers yet who got stuck having to pay their buyer-agent because the seller refused to pay. Undoubtably, there are buyer-agents who were paid a partial fee by the seller and then the buyer made up the difference – that’s the intent of the buyer-broker agreement being required now.
Some buyers (especially cash buyers) may prefer to pay for their own agent and take a lower purchase price instead, but that has always been the case.
Strangely, the CRMLS – which provides the MLS for the North SD County Association of Realtors – cannot allow any mention in the active listings of seller-paid commissions being offered to buyer-agents. But now when marking the escrow as closed, they REQUIRE the listing agent to disclose the commission amount the seller paid to the buyer-agent.
Agents who are members of the competing San Diego Association of Realtors are exempt.
I culled this data from the NSDCC sales closed between August 17 and September 18, and between September 18 and October 15 from those that did mention the specific commission amount:
There has been erosion this year. It’s because some agents are weak and desperate, as I mentioned in April.
Is that who you want in your corner?
It is much more important to sell your house for retail, or retail-plus, than save a point on the commission.
Same on the buyer side. If your agent can make a strong case why they are worth it to the seller and listing agent, they are also making a good case for them to take your offer too.
This isn’t the world we wanted. This isn’t the world we asked for. This is what 12 jurors in Missouri thought you deserved (as did the attorneys who charged $100,000,000+ for prep work and a week in court).
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Of the 139 recent sales, nine were marked with zero days-on-market (6%), which are the off-market sales typically. They aren’t as widespread as everyone wants you to think, at least not yet. In 17% of the sales, the listing agent also represented the buyer too, though there isn’t a box to check for unrepresented buyers (the listing agent must input a buyer-agent). I predict that both of these percentages will increasing.
I was in Orange County yesterday and saw this in a local publication:
The off-market craze is just getting started.
We’ve already been hearing the hucksters at open houses who lead with their only pitch:
“I operate in the off-market space.”
“Does your agent offer you off-market deals?”
“Would you like me to alert you to our off-market listings?”
“Ok, great – sign my buyer-broker agreement right here.”
When the inventory of superior homes being so tight, it is inevitable that buyers will be lured into thinking that there might be something they’re missing.
But the real benefit to the off-market action is that realtors regain control of the market.
The industry loved it during the frenzy when the MLS/search portals were publishing sales that closed several hundred thousand dollars over the list price in the first few days on the market.
But now, the MLS/search portals are the enemy.
They publish the number of days-on-market, and the price reductions….ouch. If you are a listing agent of one of those listings, you are begging for ways to hide those facts. The agents who ‘refresh’ their listings have been thwarted now because the MLS also publishes the CDOM, or combined-days-on-market to highlight when a listing was just cancelled and re-inputted:
This is one of the main reasons why the Clear Cooperation Policy will be attacked by the brokerages.
Operating in the off-market space avoids racking up days on the market, and public changes in price. Think about the commercial brokers – you have no idea how long they have been sitting on that listing, or what the price was an hour ago, let alone tomorrow.
When the market is great, then the truth is our friend.
Nowadays? Not so much.
Potential home buyers must think that the real estate gods have it out for them. Rates and prices went through the roof and never came back (yet), the bidding process is a disaster, and now they are forced to pay for their own agent (maybe). In spite of the internet, the real truth about the market has never been so well disguised. They can’t get a break!
Sellers just want their money.
Compass needs a partner. If we split from the pack over the CCP then we will be labeled the sole renegade. But if eXp, Realogy, KW, or Berkshire joins us then the rest will fall in line (the eXp CEO said so). We can quit the MLS, and make Zillow/Homes.com publish our listings the way we want them published.
In the meantime, we can expect the off-market craze to thrive.
We just had it happen. A potential seller who had decided to wait until next year had not one but TWO competing new listings hit the market nearby. Both listings were priced $100,000+ LOWER than what we were thinking. Ouch.
When is the best time to sell your home? It is case by case.
Ideally, it’s when all three of these are in play:
When there’s no competing active listings nearby.
When you have recent neighborhood sales that support your price.
When you know where you are going.
For many, those three conditions are happening now.
Who should sell now, and who should wait until next year?
Are those holding up? Here is the recent activity at La Costa Valley:
The two sales in orange were a shock, and could have led the pricing trend downward. But the last four sales are positive, helped greatly by those with a green star that are one-story homes.
If future buyers gloss over the one-story premium, they might be willing to pay $2,000,000+ for the next new listing. Because there are NONE for sale currently, it would be an opportune time for a La Costa Valley homeowner to list their home for sale right now, and avoid a potential springtime surge of inventory.
How about the Foothills in NE Carlsbad?
I sold Mastodon in July and pricing has been crushed since – mostly because of the inferior home/locations.
Here I would suggest a Foothills homeowner to take a chance and wait until another $2,000,000+ comp goes first to right the ship, and then list for sale. If the next listing is superior in every aspect, it could buck the trend, but I’d like someone else to chart that path – hopefully someone who can fight off the trend.
It’s case-by-case. Measure all the variables, and if there are NO other active listings, it might be better for you to sell now, rather than wait.
Hat tip to Jorge who sent in this interview with Jeffrey Gundlach, the prominent bond trader who speculates with confidence on the Fed’s half-point cut and what it means for the markets. He speaks quite knowledgeably about everything except the future of the housing market, which he called the ‘wild card’ for the economy.
This video starts where he says that he expects another 3/4% Fed cut this year, and then housing:
He said that none of us really know what’s going to happen……but let’s use math to predict the future.
My Theory:
It’s the HIGHER HOME PRICES that are locking in the current homeowners, not mortgage rates.
Everyone who bought a home before 2022 is enjoying a bonanza of new-found equity. Let’s use the 2019 buyer for an example. They hit the jackpot to buy a regular home for $1,300,000 back then, and now it’s worth around $2,385,000 – wow, an extra million dollars of equity, just like that!
Some may have a good reason to move, and they are DREAMING about using their same equity, and same mortgage amount to buy up and live with a slightly-higher rate.
But they can’t buy a much-better house for $2,385,000 – they already own a similar-sized house! The old house that was worth $1,300,000 is now $2,385,000. So they have to spend more to make it worth moving.
My rule-of-thumb is 50% more, or $3,577,500.
But let’s say that they work with a really sharp, experienced realtor and find a home that makes it worth moving for $3,200,000 and use ALL of their equity from the old house after closing costs:
Let’s also point out that in California the property taxes would go up an additional $1,742 per month, so the $11,345 + $1,741 = $13,086 MORE PER MONTH to move to a better home in the same area. Even if rates were to drop to 3.5%, the combined P&I+T = $10,713 per month.
“You’re killing me, Jim – aren’t there any other alternatives?” Yes, there are two:
Buy a smaller, crappier house in the same area.
Move out of town.
That’s it, or throw down another $1,000,000 in cash to keep the loan amount down where it was.
What does it mean for the 2025 market?
Mortgage rates should be lower than they are today, and probably in the mid-5%s. There will be a new president, and all the wait-and-see buyers who were determined to see the Fed cut rates before venturing out again will be storming the streets en masse. Those first-time buyers and out-of-towners are used to these prices now and will succumb.
What about the supply? We will have a similar number of deaths, divorces, and job-transfers (The Big Three) who always sell every year. Will those who bought a home since 2022 who made a mistake and bought the wrong house be motivated to sell? Not unless they can buy something at least equal or better – the ego can’t take a step down, so they may just refi to a lower rate instead.
But those who already own a house here will appreciate it even more, because once they look around, they will realize that their existing home will have to last them forever – they’re not moving!
These are examples of public or confidential remarks by listing agents to help sell their listings:
Information in this listing may or may not be correct.
Buyer’s required to submit “financial pre-qualifications” to Listing Agent for review to verify ability to close escrow before disturbing Owner for tours.
RARE OPPORTUNITY TO PURCHASE AT COMING SOON PRICE at $4,999,000 PRIOR to GOING ACTIVE WHICH WILL OCCUR ON 7/25/24 AT WHICH TIME PRICE WILL INCREASE TO $5,1999,000.
Tell your clients to put their best foot forward, please do not ask me to reveal confidential offer info received.
Please do not permit entrance of parties not associated with the scheduled showing. The property is in an Irrevocable Trust; a 45-day Notice of Proposed Action to beneficiaries is required; the seller is hopeful that this process will be completed quickly; the buyer agrees to close escrow within __ business days after notification from seller that this process is completed.
***LUXURY AUCTION SELLS IT AGAIN! CONTACT LISTING AGENT TO LEARN MORE!***
THIS IS THE ONE YOU HAVE BEEN WAITING FOR!
Include all documentation in one email, DO NOT SEND IN MULTIPLE EMAILS.
Opportunity for this land is big in the area it’s in because there is plenty of room to grow.
VERIFCATION OF FUNDS/PRE-APPROVAL REQUIRED PRIOR TO SHOWINGS.
Permits status of ADU is unknown as owners are deceased.
MAJOR FIXER. PRICE REDUCED TO REFLECT CONDITION. BUYER TO DEPOSIT NON REFUNDABLE 10% EARNEST MONEY DEPOSIT.
Regarding the distinguished koi fish: they can convey with the sale upon proof of your buyer’s true interest in the fish. They have been raised by the owners and their continued well-being is of top concern. If continuing the life of mature koi fish with love and grace is not for your buyer, please indicate in your offer that the fish should be re-homed prior to COE. The pond stays as-is
This is more than just a home; it’s a lifestyle.
Welcome to your new neighborhood in Carlsbad. Rarely available, maybe once in your lifetime.
BIG PRICE IMPROVEMENT! ACT FAST!!
This house brags like a new build.
Painter/handyman has been booked several times but postpones. So, we are going ahead with the listing. You are welcome to slip in.
BUYER MUST HAVE INSURANCE QUOTE w/ offer.
Appointments to be confirmed once a buyer representation agreement is submitted.
Borrowing this from Rob’s blog, this is known as Amara’s Law in technology spheres.
It goes:
“We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.”
When the zestimates first came out in 2006, their accuracy was really bad – wrong by 10% to 20% – and those of us in the business laughed them off as a joke. The idea of being able to find out the value of a home with one click was inticing though, so Zillow kept throwing millions of dollars into the project.
They found out that putting a value on a home isn’t so easy, and they still state today that their zestimates have a median error rate of 7.49% – which on a $3 million home is +/- $224,700!
From wiki:
While factors contributing to estimates are described elsewhere, Zillow seemingly overemphasizes home square footage as the major metric driving property valuation. This method may not be unique to Zillow, but unduly distorts value expectations. Listings in areas where land is priced at high premiums often reflect an identical Zillow estimate to that of nearby homes with comparable interior square footage, but where the home might be decades older. Condition, age of home, special features, and proximity to nuisances are insufficiently factored into the estimate. Zillow has made some effort to add balance by including an option for owners to provide their own value estimate, but these figures can be similarly unreliable as being opinion instead of quantifiable.
But homeowners have come to adore their zestimate.
Why? Because it’s been around so long, they believe it to be true.
I had a potential seller tell me last week that their zestimate was how much she could sell her house for. Not that it was the approximate value within +/-7% of being correct, and just a starting point. She believed it was going to be her sales price!
It wasn’t a problem during the frenzy because in the 2020-2022 period you could put any price on a home and it would sell. The homeowners were pleasantly surprised at the extra bonus above their zestimate, and didn’t complain.
But it is different now.
I’ve heard it twice in the last week from two different agents that their price is “right in there”, suggesting that they have evidence of their price being right and just get my buyer to pay it. But there they sit, unsold.
Having a zestimate, or having cherry-picked comps to support today’s list price is precarious – it ignores the current market conditions, which are squishy to say the least. The premium, fixed-up, and staged homes are selling briskly, and the others are sitting.
But because the zestimate has been around so long, people believe it must be right. Sellers certainly don’t want to take less! Include 1-2 older sales and sellers and listing agents want to believe the mythical nuclear buyers with 2.2 kids are right around the corner.
In the week BEFORE the new rules went into effect, there were 29 NSDCC listings that were marked pending. In the first week AFTER the new rules went into effect, there were 38 new pendings.
Homes keep selling. Buyers and sellers keep moving, and Realtors keep helping.
It’s the other jokers who got in the way.
Somehow, the National Association of Realtors conspired with ambulance-chasing attorneys to levy big fines against brokerages for crimes they didn’t commit. The alleged offenses were committed by independent contractors who had home sellers pay a bounty to buyer-agents for causing their home to sell. The seller only paid the bounty if the agents involved were able to make both the sellers and buyers happy enough that they found a way to close escrow. If the sellers weren’t happy enough, they paid nothing.
We called it a ‘buyer-agent’s commission’.
Now we call them ‘compensation paid from seller concessions’.
We put different words on it, and added a load of new paperwork. That’s it – and homes keep selling.
But the brokerages are tired of being pushed around, and the really big changes are still to come.
1. The Clear Cooperation Policy is going to go away.
In the coming months, all the big brokerages will be suing NAR to rescind the policy that requires an agent to input their new listing into the MLS within one business day after they promote it publicly. The policy was a continuance of the NAR paranoia about protecting smaller brokerages, but that ignores giving the seller a choice on how they want to market their property.
2. Brokerages are going to leave the MLS.
I’ll call it a rumor because I didn’t hear from Reffkin’s mouth myself, but it makes sense. Why be a member of a club that sells us out and fines us $50 million? The commercial brokerages get along just fine without an MLS, as does the residential brokerage business in NYC.
Zillow provides the same benefit, without the lawsuits. Let’s cut a deal with them to upload our listings there and we won’t need the MLS.
What about cooperating with agents in other brokerages?
The NAR Settlement has effectively cut off that benefit already. The main benefit of the MLS was publishing and guaranteeing the buyer-agent fees, but that’s gone now. Every buyer-agent has to call around to find out what the “seller concessions” might be, if any. Sounds just like the commercial brokers, doesn’t it? And they have never had an MLS.
Is defecting from the MLS what is best for buyers and sellers?
We will sell you on that, don’t worry. Besides, you will still have Zillow, and their manipulated zestimates!
Zillow will become the defacto MLS, just like they do it in New York City!
Bill Colson, who is preparing to sell his Maryland home next year and purchase a retirement home outside Blue Ridge, Georgia, believes the changes will create more costs.
Colson, who is 57 years old and retired from the Navy, said a Realtor in Maryland advised him to offer the standard 6% commission split between his agent and a buyer’s agent when selling his home. But in Georgia, Colson said another Realtor told him to be prepared to pay his own agent out of pocket to make a potential offer more competitive.
It means Colson would be responsible for paying out commissions for both transactions, which would have been unthinkable to many homebuyers and sellers before the changes.
“If you want to stand out, you’re going to have to pay,” Colson said.
“In the end, we may end up paying something like 9%,” he said. “Instead of making things better, it just got a lot worse.”
