California Hosung Market Forecast

The 2016 Forecast is out and while the market is expecting to remain strong this year, indicators are leading us to conclude the market will not continue to gain speed next year. 

Price gains are tapering. 

Modest improvements expected in 2016.



California fell further and has more room to gain.   

Gross Domestic Product remains underwhelming. 


Stagnant wage growth has resulted in a delay of the first time home buyer entering the market. 

International buyers came to invest, now that prices have rise , they’re staying on the sideline of the housing market. 


This indicates the peak has passed. 

Since rates are low, and inventory remains low, demand has remained solid. As soon as either of those factors uptick, the market will slow. 

Where are we headed based on what we saw last year. 

Finally, the forecast. For questions about the market, or these slides specifically, contact Realtor Amy E. Wright at 858-224-2562. 


San Diego Seller’s are in the Driver’s Seat

San Diego Sellers sit in the Driver’s seat of today’s market. Buyers aren’t in a frenzy, mostly because they can’t find what they want. The first-time home buyer is reluctant to move into the market. They are barely recovering from the recession, with stagnant wage growth, and debt mounted from schooling and credit cards. That said, the ones who are entering the market are ready and eager. The condo and townhome market has been dominantly owned by investors which when the majority of homes in a complex are non owner occupied, the complex will not qualify for the government backed FHA loan programs with a low 3.5% down payment. Many buyers are obtaining financial help toward their down payment and closing costs from relatives and Seller contribution.

Sellers who price their home to sell aggressively, will see multiple offers. Those who do not will sit while others sell. Inventory of homes for sale is down significantly, and mortgage rates have not increased to wane demand. The time is now! Prices have increased as much as they ever have over the past 3 years, affordability cannot sustain such growth. If you want to make a move and are serious about selling, consult a Realtor with a home visit to discuss condition and pricing of your home. Of course, if you are just curious, you can get a free online evaluation  to see recent relative property sales.

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Buyers today have access to sales information to help them make an informed buying decision. When a home is priced even 5% above market, buyers make choose to look the other way and wait until there is a price reduction. Price it right to get offers within the first 30 days or risk selling your competition.

FSBO: The Facts

As a real estate professional, it’s always a good idea to keep up with news and studies on what is currently going on in real estate. The National Association of Realtors is a great source for regularly updated market statistics—we’ve grabbed some of their recent data on FSBO to present here:


From the marketing data in the National Association of Realtors report, we can infer that FSBO sellers are not generally getting a lot of marketing exposure—very low percentages appear anywhere with the potential for bigger audiences (including only 15% on social media and 10% on multiple listing sites).

Additionally, FSBO sellers cited the following difficulties:

  • 18% – selling within their planned length of time
  • 12% – understanding paperwork
  • 6% – (for each) having enough time, preparing the property, getting the right price

Time, whether it’s having enough to deal with everything or being able to sell within a desired period of time, is a big issue. Other statistics show that while a sale by agent might take 69 days, the FSBO will average 88 days.

Why Do Sellers Choose FSBO?

Check out this graph from


The most common reasons are by far that the homeowner wants to save money or that they’re selling to someone they know. Does this desire to save money always pan out? Not necessarily; if an agent can get them a better price as we saw in the previous statistics, they will probably come away with the same, if not more in proceeds (and this without any DIY hassle!).

Why Do FSBO Sales Often Fail?

There’s always going to be a marked difference between going with a professional and trying to take care of a relatively complicated transaction one’s self. FSBO sales fail for a variety of reasons, but here are a few of the most common:

The Homeowner Isn’t Really Prepared

There are a few tasks a good real estate agent will always recommend a seller prepares before listing their home that FSBO sellers may not be entirely aware of. Besides knowing about what to prepare, it’s often easier if an unbiased set of eyes checks the home over—owners may be too close to notice things that should be done.

You often get only one shot to impress potential buyers, so it is important that home preparation is done well in the first place.

The Work Involved With Buyers

Screening, negotiating, closing, responding to queries—there’s a lot of time-consuming work to be done when dealing with possible buyers, work your average seller simply doesn’t have enough time to deal with effectively.

The time involved can be dragged out when the buyer isn’t very familiar with what to do or say and how to negotiate. This is where experienced agents definitely have the advantage to get the sale.


There are a couple of aspects to timing that should be understood; one is that there are better times than others to put a property on the market (such as seasonal variations), and these will depend on the specific area the property is in.

Secondly, there is a concept of “golden time” that says a property will receive bigger offers within the first week of going on the market and go down after that. FSBO sales can fail when the house sits for too long on the market (perhaps because the owner doesn’t have a lot of time to deal with marketing or negotiations), and they then receive lower offers than they should.

Contract Procedures

This comes down to experience again. If an owner is unfamiliar with contract procedures and negotiating, they may either make a bad job of it or simply lose the sale.


We saw from those statistics earlier that in general, FSBO sellers are not doing a lot of marketing of their properties. This may mean they just don’t reach the right people.

On the other hand, part of the role of an agency is to get exposure for the properties on their books. An agency not only has many different channels for exposure at their disposal, but they usually have potential buyers coming to them, which shortens the process.


Many FSBO sellers overestimate the price they should put on their property, put off potential buyers, then have to sell at a lower price later on when they’ve had the property sitting on the market for a while.

If a house is priced too high, the property may struggle to attract any offers at all, leaving future prospects to wonder why that property is still sitting unsold. This may make it more difficult to close any deals.