Also serving the communities of De Luz, Rainbow, Camp Pendleton, Pala and Pauma

Review of all things Real Estate: Happy 2024, news you might find interesting.

Good January day readers, I hope this week’s article finds everyone happy and healthy with the anticipation of a pleasant and prosperous 2024. Today’s article will hit some wavetops because there hasn’t been significant real estate activity to discuss lately.

First and foremost, in response to inquiries, yes, we did get married over the holidays. The former Miss Dianna Branch and I exchanged vows at a smallish backyard ceremony on Friday 22 December. It was super cool as Dianna’s son Peter Hallock officiated and Dianna’s daughter Lila Hargrove was her Matron of Honor while my son Robert Hillery was my best man.

The weather was great as was the food, beverages and music plus most of our children and grandchildren were in attendance. It was a grand day and we both feel so blessed.

We took a brief honeymoon to Prescott, Arizona, where we have interest in purchasing a second home as an Air B & B. I have now developed greater empathy for out-of-area buyers who want to purchase in the Fallbrook area because, even with requisite map study, it is difficult to put everything into perspective.

The house we liked was on the market one day and the entire day had appointments lined up, so we knew that it would be a competitive situation and that we would have to be aggressive to win. We offered 1% over the asking price and a short escrow since it’s a vacant property so we figured that would appeal to the seller.

It turns out that we were close, but we were not the winner so we are now in back-up position. But it was a good drill to have gone through and experience. I have written in the past that properly priced properties sell and for sellers to let the market bid it up, and we witnessed that.

The other thing was despite the higher interest rate than we had been accustomed to (remember, marry the house but date the rate) the monthly payment with a 20% down loan at 6.90% was not as startling as I was concerned about.

The takeaway is if you can afford the monthly payment then purchase the property with the anticipation that mortgage interest rates will likely come down (remember, this is an election year), but in all likelihood prices are not going to come down unless the economy totally crashes as the author I cited last week said needs to happen.

That is a segue to the author Harry Dent whom I referenced and apparently my remarks were not filled with full confidence and admiration as I got some feedback that I didn’t sound like a fan. Recall that Dent and his team use models to make their predictions.

Their website and YouTube videos indicated that the U.S. economy fit all the characteristics for their 90-year crash model and their 45-year crash model. Okay, but can models predict a worldwide pandemic or the invasion of an independent nation by an aggressive neighbor? Can models predict terrorist attacks? All of these occurrences will definitely affect the world and our domestic economies.

Perhaps that is why I am less than enthusiastic about their advice to leave the stock and real estate markets and go to cash or get into bitcoins. Cash during a high inflation period is a loser because there is no appreciation, no income or rise in value to offset the value loss to inflation.

Bitcoin value fluctuates and there is the added concern that there is no country government standing behind that currency. The U.S. dollar came off the gold standard in 1971 so now it is called fiat money. Fiat means faith and we, along with the rest of the world (since the U.S. dollar is the world standard) have faith in the U.S. Government that our currency will continue to have value.

There is no country government to ensure the value of bitcoin. Yes, that is part of Dent’s thesis that the government guarantees are part of the reason that the U.S. economy is going to fail. But I submit, if our government leaders would make the deliberate decision to curtail wanton, undisciplined spending, that government guarantees of our currency would be a significantly lesser concern.

Lastly, the market activity indicator needle stands at 46, a 3% rise over last week. However, since we only have 59 active listings, market irregularities can skew the statistics. The average price per square foot is $446; median list price is $1,250,000 and average Days on Market is 116; 32% of the inventory had price reductions while 5% increased their prices.

All this data tells me there are certainly overpriced units in our market because properly priced properties sell.

 

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