©2013 Merritt Ringer

Read, Seen, or Heard

“Many people believe that great designers get great clients.

It’s the other way around.”

~ Seth Godin

“The true spirit of conversation consists more in bringing out

the cleverness of others than in showing a great deal of it

yourself; he who goes away pleased with himself and his own

wit is also greatly pleased with you.”

~ Jean de La Brùyere

“A pessimist sees problems in opportunities, whereas an

optimist sees opportunities in problems.”

~ Winston Churchill

Table of Contents

The Big Picture…………………….…….………... 3

Distressed Properties……………….…….………... 4

Prices…………………………………….………… 5

Financing………………………………….……….. 6

Carmel………………………………...….….…… 7-8

Carmel Valley…………………………..….……… 9-10

Pebble Beach………………………...……….…… 10-11

Pacific Grove…………………………….…….…..12-13

Monterey…………………………………....….…..14-15

Monterey-Salinas Corridor………………...……. 16-17

Seaside & Marina ………………………...……… 18-19

An Agents Life …………………...….…...…….…..20

End Note …………………………………………....21

Caveat: I’m no economist (despite the performance of

most, this is not a boast). I also lack the gift of prophecy;

from the evidence, I’m not alone. But our real estate

market is buffeted and buoyed by all manner of larger

forces, so I do watch the horizons. I also dig into our

local market. The information here is as reliable as I can

make it, but nothing like comprehensive.

THE BIG PICTURE

A long view of inflation adjusted GDP, just for perspective. We took a bad tumble

and the march goes on; that’s one way to look at it.

Another view, from the Financial Times: “The global economic recovery remains

stuck below takeoff speed, unable to achieve liftoff and facing the risk of stalling.

Half-hearted fiscal austerity measures are proving to be a drag on growth and

doing little to rebuild investor and consumer confidence.

Monetary policy continues to shoulder the burden of limiting downside risks and

has kept financial markets buoyant even in the face of weak growth prospects.”

CALIFORNIA DISTRESSED PROPERTIES

A Notice of Default starts a foreclosure process. The graph below shows the

volume of such notices in California for the past two decades and offers a good

picture of the scale of our recent trauma and the healing in process. Rising home

prices, a stronger employment picture, and the fact that the most troubled homes

have already been foreclosed and resold, all combine to create today’s almost

“normal” state of affairs.

NATIONAL PRICES

CoreLogic reports national prices on a three-month weighted average that is not

seasonally adjusted: they found June closings up 11.9% over the previous June.

The chart below offers a long view of nominal national prices.

Meanwhile, Trulia reports that, nationwide, asking prices retreated 0.3% in July,

suggesting a little slowdown in the face of rising inventories and interest rates

coupled with reduced investor demand.

FINANCING

Rates

Rates fluctuate by the second and different lenders offer various packages, so the

numbers below are just a snapshot.

The rates below are for loans without points.

Up to $417,000

30 year fixed: 4.375%

5/1 ARM: 3.375%

Jumbo (over $483,000 here)

30 year fixed: 4.875%

5/1 ARM: 3.375%

The addition of a point reduces the rate .125-.250%.

CARMEL: NEW ESCROWS

25 new escrows were opened in Carmel last month. Five were asking over $2M,

which sounds fine until you consider that, as I write, there are 65 unsold homes

asking over $2M. 14 of last month’s sales were asking less than a million,

demonstrating the health of the lower end. There were two short sales and one

bank-owned, evidence that distressed sales are not quite a thing of the past. And

while sales have undulated mostly in the upper twenties, inventories have been

steadily climbing, as the chart below shows.

CARMEL CLOSED HIGH & LOW

Chris Tescher, longtime player at the Carmel development game, built this 1780 sf,

3BR/2BA home after buying a teardown in 2006 for $1.2M. Although on 15th, not

a perfect Carmel Point, location it sold in just over 3 months for a few dollars over

$2.2M.

Two condos sold for less, but this Mission Fields home, with almost 2000 sf and

4BR/2BA, was the lowest priced single family home to sell last month. It closed

for $707K.

CARMEL VALLEY: NEW ESCROWS

The Valley saw 17 new escrows last month, 7 of them were asking over a million

but only one was over two million. There was just one short sale and zero bank-

owned. Inventories have been pretty stable but there are lots of unsold stacked up

toward the higher end: 35 asking over $1.5M, for example.

CARMEL VALLEY CLOSED HIGH & LOW

The Preserve had the Valley’s highest sale last month. On 18+ acres, with

5BR/5BA (& two 1/2 baths), wrapped in 5700 sf of steel and glass, it sold in less

than two months for $5.9M.

Although several condos closed for less, this fixer in the Robles del Rio area

fetched the house price. Weighing in with just 2BR/1Ba in 870 sf, it was on a

pretty quarter acre. It closed for $459K.

PEBBLE BEACH: NEW ESCROWS

Pebble saw 15 new escrows last month. Over half were asking above a million;

one of these was at $4.950M and another at $14.5M. There was a single short sale,

which sold for $425K over the asking price to close at $2.025M. The unsold

Pebble inventory is heavily weighted toward the upper end: there are 50 unsold

properties asking over $2M.

PEBBLE BEACH CLOSED HIGH & LOW

It was only 4970 sf. Remodeled, to be sure, but contemporary in style, in a market

that still favors cute or Mediterranean. But, looking out over Stillwater Cove, it

did have a view. It sold for $28M (sic).

This condo at Shepherd’s Knoll had just been freshened up for the market. With

3BR/3BA and 2241 sf, all on ground level, it looked very attractive compared to a

newly listed but overpriced competing unit. It sold in a day for $659K.

PACIFIC GROVE: NEW ESCROWS

PG had 19 new escrows last month. Two were asking over a million and three

were asking under $500K. There were three short sales. After dipping to levels

very frustrating to buyers, inventories have now risen more comfortable levels.

However, a lot of PG’s unsold homes cluster at the high end: 21 homes are

currently listed over a million, where there is not a lot of action.

PACIFIC GROVE CLOSED HIGH & LOW

“Park-like setting , short walk from Asilomar Beach with ocean breezes and

sounds. A classic 40's rancher with great floor plan, completely updated with mod-

ern plumbing, electrical and energy saving features”, said the listor of this 3150 sf

4BR/3.5BA home. It sold in just over a month for $1.3M.

A short sale in Del Monte Park captured the bottom of the market last month. In

2004, they tried to sell for almost twice as much. Failing, they took it off the

market, invested in upgrades and held on until they had no equity. The home had

1148 sf, 3BR/2BA and sold in one day for full price: $495K.

MONTEREY: NEW ESCROWS

Monterey rocked on with 31 new escrows in July. Only one was asking over a

million and only one was below $400K. There were six new short sales and two

bank-owned. Inventories continue to be modest for this amount of demand,

especially when we consider that 20% of it is listed over a million, where demand

is thin.

MONTEREY CLOSED HIGH & LOW

This cool Craftsman-style home in the Skyline area, with many expensive

upgrades, took our top spot. With 3,432 sf, 3BR/3.5BA, and a park-like setting, it

sold in ten days for $1.205M.

A wee 1BR/1BA condo on Monte Vista Drive, with 572 sf, sold in 8 days for just

over the asking price. It closed for $190K.

MONTEREY-SALINAS CORRIDOR: NEW ESCROWS

(east to San Benancio)

Our portion of the Corridor saw a dozen new escrows last month. Half were asking

over a million (but none were over $2M) and only one was below $400K. There

were three new short sales and one that was bank-owned. The unsold inventory is

heavily weighted toward the high end with over 30% asking more than $2M, where

demand is very sporadic.

MONTEREY-SALINAS CLOSED HIGH & LOW

Off the north slope of Laureles Grade, this 3,319 sf home had 2BR/3.5BA and sat

on 2.5 acres with big views. It closed for $1.250M.

A short sale on the market for over a year at various prices, this 3,250 sf home had

4BR/3BA, a bit over an acre, and proximity (maybe too much) to Hwy 68. It

finally was listed at $499K and sold over asking for $534.5K.

MARINA & SEASIDE: NEW ESCROWS

10 new escrows in Marina. Only 3 were short sales; none were bank-owned.

Inventory continues to be very low.

Seaside saw 17 new escrows in July and a spike in inventory. There were 5 new

short sales and two were bank-owned.

Remodeled in 2006 (but not finished until quite recently), this 2700 sf home had

4BR/3.5BA and ocean views. It sold full price for $574.9K.

A short sale, this townhome had 2BR/2BA inside 1,143 sf. It sold in 9 days for

22% more than the asking price (!), closing at $260L.

SEASIDE CLOSED HIGH & LOW

An Agent’s Life

A moody day on the south coast . . .

Thank your for taking a few minutes with my e-magazine. Your

comments & questions are welcome. Let me know about issues you’d

like to see addressed here or stories and facts you’d like others to know.

Know anyone thinking of buying or selling, someone who would benefit

from informed & straight counsel? Please keep me in mind. Referrals

like yours are the heart of my practice.

© Merritt Ringer 2012

©2013 Merritt Ringer