Merritt’s Market Update

Monterey Peninsula

March, 2013

©2013 Merritt Ringer

Read, Seen, or Heard

Not your typical house remodel:

The White House, gutted, 1950.

Table of Contents

The Big Picture: Our Peninsula……….…….………... 3

Financing . ………………………….…….………... 4

Carmel……..……………………………….………5-6

Carmel Valley………………………...…..….…… 7-8

Pebble Beach…………………………....….……… 9-10

Pacific Grove………………………...……….…… 11-12

Monterey……………………………...….…….…..13-14

Monterey-Salinas Corridor…………..…………...15-16

Seaside & Marina ………………………...……… 17-18

An Agents Life …………………...….…...…….…..19

End Note …………………………………………....20

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: Our Peninsula

Our more affluent markets have suddenly shifted dramatically in a

positive direction. Below are examples of the increase in new escrows

this February over February of last year.

Carmel: up 88%

Carmel Valley: up 200%

Pebble Beach: up 143%

Pacific Grove: up 45% (an inventory shortage curtailed this number)

The lower priced areas show less change mostly because they have been

showing strong sales volume (of distressed properties) for several years.

Low inventories are also inhibiting sales volume in some places.

Monterey: up 33%

Marina: down 29% (low inventory is an acute problem here)

Seaside: up 14%

Rising volumes, of course, is the first step toward rising prices. If the

increased activity pulls more inventory from the sidelines it may not

translate immediately into higher prices. But we are seeing upward price

pressure in several areas.

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: 3.625%

5/1 ARM: 2.675%

Jumbo (over $483,000 here)

30 year fixed: 4.125%

5/1 ARM: 2.75%

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

CARMEL: NEW ESCROWS

BOOM! Carmel had 32 new escrows during the short month of February. 21 of

these were asking over a million and 7 of them were over $2 million. Eleven of

these homes sold in less than two weeks. Three of the new escrows were short

sales and there were zero foreclosed homes. This is suddenly a zippy market.

CARMEL CLOSED HIGH & LOW

In the heart of the Golden Rectangle, this 1939 semi-updated home had 3BR/4BA,

2,725 sf (including a separate guest house), a two-car garage, and was on a double

lot. It took 307 days to find a buyer but they closed for $3M.

A 1BR/1BA condo with 452 sf at the edge of downtown was last month’s lowest

Carmel sale. It closed for $475K.

CARMEL VALLEY: NEW ESCROWS

Carmel Valley saw 24 sales in February, almost one per day in this shorter month.

7 of these sales were over a million. There were 3 new short sales and one bank-

owned. Some properties that had been on the market for a long time suddenly

found buyers. For example, modernist beauty on Via Milpitas, above the village,

went into escrow after being on the market almost without a break for nearly two

years (to clarify, though, they started at $3.950M and, at the end, spent 5 months

asking $2.295M before they found a buyer).

CARMEL VALLEY CLOSED HIGH & LOW

Valley Green Circle at Quail captured the top spot last month (& a neighbor took

2nd place). This remodeled home had 3BR/2.5BA and 2,553 sf. It took two tries:

first, they spent 7 months testing $1.695M and $1.495M.; another 250 days asking

$1.395 finally resulted in a sale for $1.275M.

A post adobe ranch in the Robles Del Rio area fetched the lowest berth. On a level

3/4 acre, with 4BR/2.5BA and 2,317 sf, this became a short sale after they spent 9

months testing prices from $869K down to $697K. They then waited a couple

years & came back asking $499K. It sold in days for $505K.

PEBBLE BEACH: NEW ESCROWS

Pebble saw 17 new escrows in February. Twelve of the sales were asking over a

million and three were over $3 million. Not one transaction was a distress sale.

PEBBLE BEACH CLOSED HIGH & LOW

On Bird Rock, across the street from the 18th green of the Shore Course, this

remodeled home had 4BR/3.5BA and 2,718 sf. They originally listed for $2.350M

in 2005. They flirted with a short sale last year but it fell out of escrow. This time,

the prices were up enough that they apparently avoided short-selling and closed at

their full asking price: $1.449M.

A condo at Ocean Pines with 3BR/2BA and 1,406 sf took the bottom spot. It sold

for $415K.

PACIFIC GROVE: NEW ESCROWS

PG saw 16 new escrows in February. Half were asking over $600k, though only

one was over a million. Two of the new escrows were short sales. The big story in

PG may be the shortage of inventory. Last February, we had 83 homes for sale;

now it’s 35.

PACIFIC GROVE CLOSED HIGH & LOW

Some big views, 4BR/2.5BA, & 2,033 sf characterized this home on Del Monte

Blvd.. Listed at $1.395M, it sold over asking in 8 days for $1.450kM.

A remodeled home in Del Monte Park claimed the low rung. With 1,452 sf, 3

bedrooms but only one bath; it also had a separate remodeled studio with a bath of

doubtful legality. It took 199 days to sell for $480K.

MONTEREY: NEW ESCROWS

Monterey racked up 24 new escrows in February. Half the sales were asking

$500k or more; but only one was over a million. There were 4 bank-owned sales

and 2 short sales.

MONTEREY CLOSED HIGH & LOW

This large home in Skyline Forest, with 3800 sf, 5BR/3.5BA, including a separate

guest unit, took top spot. In 2005, it sold for $1.210M. After a stab at the market

in 2008, when they asked $1.495M, they have been more or less continuously on

the market since September, 2010, when they started out at $1.1M. They finally

achieved success by asking $750K and closed for $710K.

A 1BR/1BA condo on Casanova took the bottom spot when it closed for $90K.

MONTEREY-SALINAS CORRIDOR: NEW ESCROWS

(east to San Benancio)

The corridor saw 10 new escrows last month. Six sales were asking over a million.

Two of the new escrows were bank-owned and two were short sales.

MONTEREY-SALINAS CLOSED HIGH & LOW

On York Road, near the coast, in 3 acres and surrounded by 8 more acres of

greenbelt, this 4B$/3.5BA, 3800 sf custom home (27 years old) sold in a couple

months for $1,357,500.

A remodeled end-unit condo at the Villas with 3BR/2BA and 1,815 sf took the

bottom spot after they tried to sell, on and off, since 2009. It closed for $390K.

MARINA & SEASIDE: NEW ESCROWS & TRENDS

Marina saw 12 new escrows in February; half were distress sales: 3 short,

3 bank-owned. All were asking less than $500k.

Home prices are showing some upward movement in Marina. Given the similarity

of the homes selling over time here, price/sq. ft. averages are a useful metric. The

first two months of last year, homes closed for an average of $185.50/sq. ft.. The

first two months of this year, it was $219.50. That is an 18% increase. Longer

time series confirm this trend.

Both these markets are benefiting from demand outstripping supply. However, full

recovery is still being retarded by the substantial volume of distressed properties.

Seaside had 16 new sales last month. Half were distressed: one bank-owned and

7 short sales.

Home prices are rising in Seaside. Given the similarity of the homes selling over

time here, price/sq. ft. averages are a useful metric. The first two months of last

year, homes closed for an average of $209/sq. ft.. The first two months of this

year, it was $256.50. An almost 23% increase. You see the same basic trend in

longer time series.

In 2004, this Seaside Highlands home sold for $877.5K. It had 5BR/3BA and

3200 sq. ft.. This time, it was a short sale that sold in a day for 29% less at

$619K.

Another great photo for the Annals of Marketing. This Marina condo on

Eucalyptus had 2BR/1BA and 881 sq. ft.. In 2005, it sold for $390K, was lost in

foreclosure, and was just sold by the bank for $125K.

CLOSED HIGH & LOW

Marina + Seaside

An Agent’s Life

With most of the country buried in white stuff, it seems

appropriate to acknowledge that some of our trees, too,

are cloaked in white. Cherry blossoms, of course.

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

ments & 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

Merritt’s Market Update

©2013 Merritt Ringer