Effect of Tax Law on Area Real Estate Uncertain
FALLBROOK, Calif., January 5, 2018 — Real estate in North San Diego County ended 2017 with positive momentum that should carry well into 2018, Jerry Kalman, a realtor® with HomeSmart Legends here, reported today.
He said persistently tight inventories, still favorable interest rates and a robust local economy all point toward a positive near-term marketplace for residential home-selling despite any possible negative effects from recently enacted tax initiatives.
According to Kalman, December real estate sales volume in Fallbrook and Bonsall was essentially flat compared with the prior month and December 2016. Average sales prices for single family residences at $631,000 showed a four percent gain over the prior year and one percent better than November, which reflected a typical pattern for the final month of the year.
Most pronounced was the average market time of 45 days for homes that closed escrow in December, a 20 percent improvement over December of 2016.
Almost a third of the homes sold at or above the original asking price, and all but one was either for cash or on a conventional transaction. VA/FHA transactions dipped to 16 percent of activity in December. He estimated that a decline in VHA/FHA activity was due more so to lags by lenders in processing loan applications than to any dip in booking these transactions.
“Price-per-square-foot is an important metric for pricing homes in diverse communities such as we have here in North San Diego County,” Kalman said. “In December, we registered a slight increase to $265 per square foot, largely due to a six percent rise in Fallbrook. The overall San Diego value rose almost ten percent to $383 per square foot, indicating property values are better in this part of the county.”
Looking at properties in escrow, Kalman said that entering the new year, 62 homes were off the market with an average asking price of $622,000. “That 30 percent decline in volume and relatively flat price indicates January activity might be shallower than a year ago and prices could be nominally flat to slightly lower than in December,” he forecast.
Five condos, four in Bonsall, were in escrow entering January. At the other end of the spectrum, five million-dollar-plus homes were in escrow, three of them in Fallbrook, and that could help buoy prices coming out of the gate in 2018, he said.
Only 162 homes remained in the active inventory entering 2018, however, Kalman expected that number to increase dramatically as agents and sellers return homes back to the market that they removed for one reason or another.
Comparing 2017 with 2016
In most metrics, 2017 was a better year for local real estate than 2016. He noted improvements in average volume per month, selling prices and market time in 2017; most notable was a seven percent increase in the average selling price last year.
As a reflection of the tight inventory, market times dropped by an average of 14 percent or eight days when comparing 2017 with the prior year. That same constriction in inventory kept volumes fairly close to each other over the two years at an average of 72 attached and detached homes selling each month.
Price-per-square-foot came in only two percent better at year-end than in 2016 due largely to a dip in the Bonsall valuation, which he attributed more to market volatility than the ravages of the recent Lilac Fire that hit a large chunk of that community.
Kalman´s data for the reporting periods ending Dec. 31, 2017, came from Sandicor, Inc. and CRMLS. San Diego and Riverside counties’ multiple listing services for realtors. This report represents properties listed or sold by various brokers in the region. He uses this information as a community service to analyze market trends and provide professional insight into real estate activity. Kalman is a licensed realtor (Calif. BRE # 01328697) in the North County office of HomeSmart Legends, 701 S. Main, Fallbrook, at (760) 468-4689 (voice or text) or firstname.lastname@example.org.
HomeSmart, founded in 2000, has more than 10,000 agents and broker associates in offices throughout 15 states. HomeSmart Legends is the first franchise in the HomeSmart system. The Temecula office is located at 27645 Jefferson Ave., Suite 116, Temecula, CA 92590.