Talk all you want about consumer sentiment and buyer psychology, those are hard to measure.
Let's look at the facts, and specifically focus on what has happened since the the mortgage meltdown in August, and the results here in the first month of 2008.
Where is the higher-end market in 2008?
Let's start in 92067. "The Ranch", Rancho Santa Fe, regularly ranks in the top five exclusive neighborhoods in America. If you want to be in the heart of the Ranch, the Covenant, and spend $3,000,000, you'll get an older house that needs work on a couple of acres, but in the outlying areas that'll get you a newer estate on an acre or so.
Here are the current stats for detached listings above $3,000,000:
115 active listings, list prices averaging $830/sf.
21 closed since 9/1/07, averaging $574/sf.
3 closed since 1/1/08
3 have gone pending since 1/1/08
Rancho Santa Fe continues to defy gravity, as markets go, and sales keep happening. The average 'days on market' for these 115 active listings is 149, and that's not counting the relists, so it's probably closer to 200.
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The 92024 zip code is the City of Encinitas, just north of RSF, and consists of coastal properties, tract homes, and a number of ranches in Olivehain.
Here are the current stats for detached listings above $2,000,000:
36 active listings, list prices averaging $629/sf, 157 DOM
10 closed since 9/1/07, averaging $651/sf. 95 DOM
3 closed since 1/1/08
2 have gone pending since 1/1/08
When you only have 10 pieces of data in a sample, the averages can be skewed somewhat. If you look at the solds since 1/1/07, they average $601 per square foot, and 80 days on market. (We should add 50% to these days-on-market stats to account for relists.)
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The 92130 zip code is commonly referred to as Carmel Valley, and is official a City of San Diego address. The real estate values benefit from top-rated schools and proximity to downtown and other employment centers. It is known for its tracts, but there are a number of large estates in the outlying areas.
Here are the current stats for detached listings above $1,500,000:
45 active listings, averaging $521/sf, 102 DOM
18 closed since 9/1/07, averaging $486/sf, 65 DOM
2 closed since 1/1/08
0 gone pending since 1/1/08
Oh-oh, none have sold so far this year, and 45 are waiting. The 102 average days on market is more like 160 counting relists, and the gap between average asking price-per-sf and sold-per-sf isn't that far apart.
Will there be adjustments made by the sellers and their agents? Or can they hold out like they do in the Ranch?
Carmel Valley is approximately 20 square miles, and has an estimated 2005 population of 27,839. The average adjusted gross income in 2004 was $131,876 - is that enough to keep it all afloat, or will sellers be forced to lower their prices substantially to effect a sale?
The buyers are waiting, judging by the goose-egg for 2008.
For more statistics on 92130, here's a link to city-data:
CV is the area east of the I-5 freeway, south of RSF (orange area)
