Santa Clarita Home Sales Activity May 28 2021

Well, color me happy! Isn't that what Julia Roberts said in the 1990 movie Pretty Woman? I loved that movie, and still consider it an all-time favorite.

Been a rough time for buyers, but I'm so dang happy as I have 3 of my buyers in escrow right now! So, definitely Color Me Happy!

Activity in all of Santa Clarita has continued to be robust. Definitely, incredibly robust.

Currently we have a whopping 218 homes available for sale in SCV. I was complaining on Social Media a few years ago that we only had 720, now I'm excited we have over 200!

In the Coming Soon category we have a measly 30. I used it again this week. Listed a sweet little home on Tuesday in Coming Soon for showings to start Thursday? By this morning I was fully booked Thursday through Sunday! And, I have a waiting list for cancellations! Ask me about why it's a great marketing tool!

In escrow, meaning the buyers & sellers have agreed to terms and are working through disclosures, appraisal, etc? We have 576. EXCELLENT.

Closed escrow in the last 30 days was 461. That's 30% more than we have done for years.

What's that word again? Robust. 

But, truly, Color Me Happy, I've got 3 buyers in escrow!!!

And, for other happiness, I've got 3 more Sellers getting ready to hit the market.

What's your favorite phrase from a movie?

Reading Daily! What the 'Experts' Say

Where Do Experts Say the Housing Market Is Heading?

As we enter the middle of 2021, many are wondering if we’ll see big changes in the housing market during the second half of this year. Here’s a look at what some experts have to say about key factors that will drive the industry and the economy forward in the months to come.

realtor.com

“. . . homes continue to sell quickly in what’s normally the fastest-moving time of the year. This is in contrast with 2020 when homes sold slower in the spring and fastest in September and October. While we expect fall to be competitive, this year’s seasonal pattern is likely to be more normal, with homes selling fastest from roughly now until mid-summer.”

National Association of Realtors (NAR)

“Sellers who have been hesitant to list homes as part of their personal health safety precautions may be more encouraged to list and show their homes with a population mostly vaccinated by the mid-year.”

Danielle Hale, Chief Economist at realtor.com

“Surveys showed that seller confidence continued to rise in April. Extra confidence plus our recent survey finding that more homeowners than normal are planning to list their homes for sale in the next 12 months suggest that while we may not see an end to the sellers’ market, we might see the intensity of the competition diminish as buyers have more options to choose from.”

Freddie Mac

“We forecast that mortgage rates will continue to rise through the end of next year. We estimate the 30-year fixed mortgage rate will average 3.4% in the fourth quarter of 2021, rising to 3.8% in the fourth quarter of 2022.”

Bottom Line

Experts are optimistic about the second half of the year. Let’s connect today to talk more about the conditions in our local market.

Spoiler - I Didn't Write This One! Thoughts?

Sellers Are Ready To Enter the Housing Market

One of the biggest questions in real estate today is, “When will sellers return to the housing market?” An ongoing shortage of home supply has created a hyper-competitive environment for hopeful buyers, leading to the ultimate sellers’ market. However, as the economy continues to improve and more people get vaccinated, more sellers may finally be in sight.

The Home Purchase Sentiment Index (HPSI) by Fannie Mae recently noted the percentage of consumer respondents who say it’s a good time to sell a home increased from 61% to 67%. Doug Duncan, Senior Vice President and Chief Economist at Fannie Mae, indicates:

“Consumer positivity regarding home-selling conditions nearly matched its all-time high.” (See graph below):

Fannie Mae isn’t the only expert group noticing a rise in the percentage of people thinking about selling. George Ratiu, Senior Economist at realtor.com, shares:

“The results of a realtor.com survey . . . showed that one-in-ten homeowners plans to sell this year, with 63 percent of those, looking to list in the next 6 months. Just as encouragingly, close to two-thirds of sellers plan to sell their homes at prices under $350,000, which would offer a tremendous boost to affordable housing for first-time buyers.”

Bottom Line

If you’re considering selling your house, don’t wait for more competition to pop up in your neighborhood. Let’s connect today to explore the benefits of selling your house now before more homes come to the market.

Changes Are Coming!

Sunday morning I filmed my weekly Monday YouTube video about Open House changes. Published it Monday morning.

Monday afternoon I got an update from our broker with new info about....well, damn....Open Houses! And, yes, we are truly going to be able to do open houses. But, we must maintain Social Distancing.

**Revised Open House and Showing Rules (This is Written for Realtors):

1. Advertising Open Houses: A real estate licensee may advertise open houses without qualifications. This includes in MLS or other places. 

2. No Appointments Required for Open House Attendees: The new rules state open houses are permitted and there is no requirement for appointments. 

3. Multiple Groups Now Allowed on Property: For both open houses and showings, you may now have more than one individual or connected group of persons on the property. The number of groups or individuals should allow for social distancing between each group. The total number of persons allowed also depends on tier level. [see #8]. The simplest way to approach this is to: a. Have social distancing between households and b. Adjust and limit the number of persons in the property at any given time to achieve social distancing. 

4. Face Masks: All visitors must wear masks indoors, even if vaccinated, and comply with the other guidance such as hand sanitizing or washing. You should have extra face masks available for those who do not have one. 

5. Sign in: All persons entering should sign-in either digitally or in writing. New form PSI – Property Sign In which can be used for this purpose. The sign-in form should include certain agreements (see 6 a-c). 

6. What should the sign- in include? The sign-in should include a statement that by entering the property, the visitor is agreeing: a. To Follow the Posted Rules of Entry b. That they have received a link to or of copy to the Prevention Plan (Form BPPP version 5/21) c. That the visitor is not feeling sick, does not have other COVID like symptoms and has notbeen exposed recently to someone with COVID to their knowledge. 

7. Can I still just use the PEAD-V? Yes. Either the new PEAD-ALL, or the PEAD-V accomplishes all of the above. The Posted Rules of Entry must still be posted. However, a sign-in having the key elements above is sufficient instead of a PEAD form. Note the PEAD forms are now being simplified and combined into one form PEAD-ALL and will be available soon on zipForm and is available now as a pdf on car.org at https://www.car.org/riskmanagement/covidlegaldocs. 

8. How can I determine what is the maximum number of people allowed in the property? The main rule of thumb is to have adequate social distancing between different buying parties. For properties in the yellow and orange tiers that, as a practical matter, is the main limitation. You will have to limit entry to ensure that everyone is able to maintain at least 6 feet of physical distance from everyone who is not in their household. QUICK GUIDE Copyright©, 2021 California Association of REALTORS®. May 14, 2021 (revised). However, there can never be more than 50 in the yellow tier, 25 in the orange tier, and 10 in the red tier. For the purple tier, allow no more than one buying party at a time. Click here [https://covid19.ca.gov/safer-economy/] to see what tier county the property is in. Your city or county may have more restrictive rules in place. 

9. What is required for Posted Rules for Entry? The Rules for Entry must be posted at the entrance to the property and be clearly visible. Also, you may link to or publish these rules in MLS listings and publicly online. This C.A.R. form PRE can be used for this purpose; available soon on zipForm and at: https://www.car.org/riskmanagement/covidlegaldocs 

10. What are the cleaning protocols? The property should be cleaned once a day consistent with the CDC guidelines [https://www.cdc.gov/coronavirus/2019-ncov/community/disinfecting-buildingfacility.html] which states: “Determine How Often To Clean High-touch surfaces should be cleaned at least once a day. More frequent cleaning might be needed when the space is occupied by young children and others who may not consistently wear masks, wash hands, or cover coughs and sneezes. If the space is a high traffic area, or if certain conditions apply, you may choose to clean more frequently.” 

11. Are there other precautions that should be taken? Open doors and windows, weather permitting, to introduce fresh air. It is also recommended to have sanitizer and wipes available for cleaning and to have masks available so that persons without masks will not have to be turned away. 

12. Does this change any protocols for appointment-based individual showings? The individual showings, whether through lock boxes and/or by appointment, should comply with the same rules as open houses as it relates to masks, hand sanitizing/washing, social distancing and posted rules. A PEAD form may still be used for individual showings, but a sign-in sheet or digital sign-in process is also adequate if the signer 1) agrees to follow the Posted Rules of Entry 2) is given access – even if a link – to the Prevention Plan and 3) an indication that by entering the property, one is declaring that they are not feeling sick, have other COVID likesymptoms and, to their knowledge, has not been exposed recently to someone with COVID.

Ahhhhhh, well, I'm looking forward to seeing how well we all navigate these changes. 

Super glad to see them here even though in this market we don't need Open Houses.

Thoughts about the relaxation with the Real Estate Industry?

I May Still Wear Gloves....

  .....But, I Won't Miss Trying To Schedule Showings!

I woke up this morning to a free weekend! Yes! Hah! I knew it wouldn't stay free. I had 4 buyers with properties they wanted to see. And, scheduling during a pandemic is quite the challenge!

So, this is what I have to work with. Some agents just want the Corona Virus PEAD-V form from the easy Glide program on each listing in our MLS. Some do absolutely not want it that way.

Some want the PEAD-V, proof of funds, & a lender pre-approval just to try and schedule.  Some want text, some want email. Some want phone calls.

Some don't want me to even ask for an appointment until I've sent the required documents. Some use the MLS ShowingTime program. Some use another calendar link program.

Sooooo many different options, requests, times my clients (and myself) are available.

One of my Sellers recently called me a 'Project Manager'. That's for keeping every part moving and everyone informed. I swear I'm an Assistant Project Manager just to get appointments scheduled to show homes to my buyers!

Took me a couple hours this morning, but honestly? I got lucky. Got a 1 pm, 2 pm, 3 pm, and a 4 pm tomorrow....right in a row for 3 different buyers. Couldn't get 4th scheduled for tomorrow, but got them in for Sunday!

I will not miss this at all. Nope, when the market & the pandemic settle down, #RealtorLife will go somewhat back to normal. Whatever normal really is these days!

Sell Local, Buy Local, For Real Estate Too!

So, if you've been chatting with me about anything Real Estate related, I've been mentioning how many buyers are coming from out of the area.

For years and years, our SCV agents have always been the cream of the crop. Certainly when in comparison to the 'other' valley agents. We're not all perfect...well, except me of course...LOL....but SCV agents are a notch above those other ones.

We work together, play together, LIVE together. So, we're probably extra conscientious about doing the right thing as we may bump into each other in the grocery store as well as across the table on a Real Estate transaction.

The last 6 months I've noted about 80-85% of the buyers coming to my listings are from out of Santa Clarita. We've always had quite a few come up, but now it's definitely not a balanced scale. 

And, they are beating out of little local buyers. Beating them out in a huge way, with tons of money.

Why? Because they are seeing what they can buy out here vs. what they can't buy where they currently live. I've talked with agents here and in the other valley about it. It is what it is.

So, what can we do about it?

Think outside the box.

Well, kinda. Those out of area agents, and my SCV peers as well, have always asked the listing agent 'what can I do to get my buyer that home?' Unless our Sellers allow it, they are shooting darts blindly and hopefully putting their best foot forward.

I had a conversation with one of my buyers about it just this week. Their response was that's just not good for our locals.

So, this morning, on one property, I spoke to the listing agent. I know they have always preferred to work with a local agent, they trust me, we've done deals before, several. I asked to ask the Seller what it would take for the local buyer to get the home vs. an out of area buyer? To, you know, Keep It Local.

We discussed it at length, a number was provided. But, not sure if that's going to be the final number. I will ask again when we are ready to submit, what's it going to take for Seller to keep it local?

Hoping for a number that works, hoping to keep it local indeed.

We shall see.

Right Now, More Than Ever!

Patience Is the Key to Buying a Home This Year

The question many homebuyers are facing this year is, “Why is it so hard to find a house?” We’re in the ultimate sellers’ market, which means real estate is ultra-competitive for buyers right now. The National Association of Realtors (NAR) notes homes are getting an average of 4.8 offers per sale, and that number keeps rising. Why? It’s because there are so few houses for sale.

Low inventory in the housing market isn’t new, but it’s becoming more challenging to navigate. Danielle Hale, Chief Economist at realtor.com, explains:

“The housing market is still relatively under supplied, and buyers can’t buy what’s not for sale. Relative to what we saw in 2017 to 2019, March 2021 was still roughly 117,000 new listings lower, adding to the pre-existing early-year gap of more than 200,000 fresh listings that would typically have come to market in January or February. Despite this week’s gain from a year ago, we’re 19 percent below the new seller activity that we saw in the same week in 2019.”

While many homeowners paused their plans to sell during the height of the pandemic, this isn’t the main cause of today’s huge gap between supply and demand. Sam Khater, Vice President and Chief Economist at Freddie Mac, Economic Housing and Research Division, shares:

“The main driver of the housing shortfall has been the long-term decline in the construction of single-family homes . . . That decline has resulted in the decrease in supply of entry-level single-family homes or, ’starter homes.’”

When you consider the number of homes built in the U.S. by decade, the serious lack of new construction is clear (See graph below):The number of newly built homes is disproportionately lower than the rate of household formation, which, according to the U.S. Census Bureau, has continued to increase. Khater also explains:

“Even before the COVID-19 pandemic and current recession, the housing market was facing a substantial supply shortage and that deficit has grown. In 2018, we estimated that there was a housing supply shortage of approximately 2.5 million units, meaning that the U.S. economy was about 2.5 million units below what was needed to match long-term demand. Using the same methodology, we estimate that the housing shortage increased to 3.8 million units by the end of 2020. A continued increase in a housing shortage is extremely unusual; typically in a recession, housing demand declines and supply rises, causing inventory to rise above the long-term trend.”

To catch up to current demand, Freddie Mac estimates we need to build almost four million homes. The good news is builders are working hard to get us there. The U.S. Census Bureau also states:

“Privately-owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 1,766,000. This is 2.7 percent (±1.7 percent) above the revised February rate of 1,720,000 . . . Privately-owned housing starts in March were at a seasonally adjusted annual rate of 1,739,000. This is 19.4 percent (±13.7 percent) above the revised February estimate of 1,457,000. . . .”

What does this mean? Lawrence Yun, Chief Economist at NAR, clarifies:

“The March figure of 1.74 million housing starts is the highest in 14 years. Both single-family units and multifamily units ramped up. After 13 straight years of underproduction – the chief cause for today’s inventory shortage – this construction boom needs to last for at least three years to make up for the part shortfall. As trade-up buyers purchase newly constructed homes, their prior homes will show up in MLSs, and hence, more choices for consumers. Housing starts to housing completion could be 4 to 8 months, so be patient with the improvement to inventory. In the meantime, construction workers deserve cheers.”

Bottom Line

If you’re planning to buy this year, the key to success will be patience, given today’s low inventory environment. Let’s connect today to talk more about what’s happening in our area.

NOTE: THE ORIGINAL VERSION OF THIS BLOG INCLUDED A GRAPH SHOWING TOTAL NUMBER OF HOUSING UNITS BUILT, WHICH INCLUDED HOUSES AND APARTMENT UNITS. THE REVISED GRAPH, SHOWN HERE, INCLUDES ONLY SINGLE-FAMILY HOMES, WHICH MORE ACCURATELY EXPLAINS THE CURRENT SITUATION.