San Luis Obispo Real Estate News Update 2019

Posted on March 4, 2019 by Joanie Williams

2018 North County Real Estate Review and 2019 Real Estate Forecast

House in San Luis Obispo County

This is a look back into 2018 real estate trends as well as some thoughts as to how we might see those trends continue or change into 2019.

During our peak buying season which is June and July in North County, we began to see buyer resistance to the increasing prices of single family residences in our area.  Perhaps this hesitation was due to interest rate increases, fear of another recession, or just the continuing anxiety in our Country in general that we see broadcast on the new each evening.  Whatever the cause of this change it did not take long for Sellers to adjust their pricing in order to make things happen.  But because of buyer hesitation, we sold about 100 less homes in 2018 versus 2017, with the average price increasing about 5% to an average price of $460,000.  Inventory is trending upward but choices still remain low, especially at the lower price points.

More homes over a million dollars sold in 2018 than ever before in North County.  While this segment of the market is relatively narrow it illustrates a couple of key points.  Number one is that urban refugee buyers from LA and the Bay Area, see great cost value in our properties and our area.  Most of these million dollar plus properties sell below replacement cost so that is an added attraction to the inbound buyer.  Number two is that a number of homes with vineyards sold this year as buyers realized the long term affects the SLO County Water Ordinance would have on future vineyard installations.  Many of these sellers with vineyards are also dealing with the prospect of replanting due to disease, age and varietal preferences.  Sellers adjusted their expectations and buyers bought.

The wine grape market is facing an uncertain path this coming year.  Some varietals were very soft in pricing at harvests end and some even went unpicked.  There is still demand to plant on the west side. 

Our rental market took a breather mid-year but that ended quickly.  Rents are still strong and so is demand for multi-family product.  Commercial and industrial space as rentals are in demand and most buildings are finding tenants.  Templeton will see an explosion of medical/hospitality space in the next decade.  Hotels and RV parks have been built and more are on the way.  Tourists come, spend money and leave.  That’s nice.

California is the sixth largest Country in the world and the Central Coast is one of the most desirable and dynamic communities in the State.  The following are some trends we are seeing in our office.  Significant wealth is shopping and buying in North County.  The cost of building and securing entitlements continues to rise making buying existing built properties much more desirable compared to building.  Across the Country property taxes are rising due to government budget shortfalls.  Proposition 13 is an enormous benefit for the real estate investor.  Our wine industry is growing and their ceiling is high.  More buyers are considering real estate as an investment, versus traditional equity markets.  Water is and will continue to be the number one issue for North County.   People leaving North County for Nevada, Texas and Idaho are being replaced by urban refugees from the Bay Area and LA. 

I believe North County is the place where we will continue to see an increase in tourism, and its desirability will grow for those who are looking for a better place to live.  Opportunities in 2019 for buyers and sellers will happen.  Interest rates are favorable, now that the market has taken some time to adjust.   Our local economy is strong.  No one has it better than we do!

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Real Estate Downshift – October 2018

Posted on October 29, 2018 by Joanie Williams

Real Estate Downshift      downshift

When you are in the business of selling real estate, it’s sometimes hard to say what’s going on until you have the data to prove what might be just a feeling. And each of us as independent contractors working for a brokerage has a unique look into the marketplace. So when we have a chance as agents to meet and talk about what’s going on today, it is always a great opportunity to learn.

Last week I met with a number of seasoned professionals in my RE/MAX office. We all shared a similar outlook. We are seeing fewer showings on listings, and are writing fewer deals. And today only certain segments of the market seem to be thriving. The homes that are in very good condition and are very well priced can still see multiple offers. That tells us that buyers are still willing to write offers, but are very selective on what they are purchasing. We are also seeing an inventory reduction in large million dollar plus estate and vineyard parcels. We know, therefore, that there is serious capital on the market looking for a worthwhile investment.

What else do we know? We know that the interest rates we have enjoyed in the past few Union Rdyears are going away. The 3 – 4% rate is gone and we are creeping into the 5%+ territory. That’s a Real Estate Downshift.  While this may not seem like a huge difference to a buyer, it is enough to cause a market on the edge of affordability to slow down.

With little to no new construction in our area, existing home prices have increased based on lack of supply.   And since that increase has far outstripped increasing incomes here, that interest rate change further erodes the affordability of our area.

Higher interest rates and more expensive inventory has increased the time homes are sitting on the market. We now have about a 3 to 4 month supply. That means a Real Estate Downshift that buyers can take a bit more time deciding what to buy, sellers need to negotiate more and have their properties in tip top shape, and instead of listing their home $5000 higher than their neighbor sold for last month, they may need to underprice their home by that amount because there are 2 other properties also for sale on their street.  IMG_0624

A downshift from a pure sellers market to a more evenly weighted transaction….I’d say 5th gear to 4th for sure, and possibly even to 3rd gear as we take the turn ahead.

The great news is that sellers are still achieving sold equity returns on their homes when they do decide to sell. Possibly not what they had hoped, but if priced competitively, their home will sell. No one is making any more of them in North County right now.

I’ll have some solid statistics for you at year end.

30 years selling real estate to better serve you!    Joanie

 

 

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2017 North County Real Estate Review and Forecast

Posted on January 8, 2018 by Joanie Williams

2017 North County Real Estate Review and Forecast

This is a look back at North County Real Estate in 2017 and some thoughts on the coming year. It’s a privilege to live and work in such a desirable community.

Unit sales for in town homes topped 900 properties for the second year in a row.   The average sale price of residential single family homes in North County was $457,000 which reflects a 6% increase over 2016. Homes priced under $500,000 are by far the strongest market in our community. We still have historically low inventory and new home Paso Robles Westsideconstruction is minimal. Consistent demand coupled with lower supply is where we are heading in 2018.

Homes on acreage really jumped in price to an average sale price of $742,000 which reflects a strong 12% year to year increase. These properties had been lagging a bit but pricing is catching up. Atascadero and Templeton homes on acreage led the way. Million dollar homes also got some traction in 2017. The number of million dollar sales jumped up to 54 units from 38 in 2016. There is still a year and a half of inventory in this category but we did move forward. Million dollar homes are still selling for well below replacement value.

Our rental market is still strong with little vacancy. However, there are close to 200 apartment units being built in North County in 2018. Also, we are beginning to see more infill residential construction throughout the area. If lending conditions remain favorable, we should see a significant increase in new construction by 2019.

The Wine Industry continues to drive a hospitality and entertainment industry that is actively accelerating. There are many new hotels and restaurants planned and under construction. Paso Robles is the focal point of most of this economic activity. Wine grape prices are solid and producing vineyard prices are firm. Even though millennials are a quarter of the population these young people consume 42% of the wine product in the U.S.

View of Paso Robles from Daou Winery

View of Paso Robles from Daou Vineyards

Commercial real estate has been consistent. Retail is a little spotty with internet sales so strong. Financial industries like banks are growing. Office space is stable. Industrial is still driven by user demand but the Wine Industry is providing demand for storage, crush locations, etc. Multi-family sells quickly if lit is priced right.

Conversations about the real estate bubble have been replaced by the Tax Reform situation. There is always the next ‘woe is me’ current event for the media to blow out of proportion. Tax Reform will likely prove helpful for a majority of the people in our Country, but tough for others. No law has ever or will be passed which is a win for 100% of the people.

We have lived for eight years with little growth and Real Estate has been driven by cheap interest rates. Now the government is trying to replace a transfer of wealth economy into a growth economy. So let’s see what happens. Whatever happens, we will compete.

North County is thriving for many reasons. We have a wealth of natural beauty and ideal weather. Our local government helps our community compete and grow. We have wonderful community leadership and citizen participation. Individuals have invested large sums of money into our Ag and Hospitality Industries. We have a wonderful new Regional

Lovely new destination hotel in Paso Robles

Lovely new destination hotel in Paso Robles

 

Airport and strong economic activity in our Medical community. All three North County communities continue to improve in liveablity. There are many reasons to see that the North County will continue to thrive

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Real Estate Market Predictions 2017

Posted on June 9, 2017 by Joanie Williams

Market Predictions 2017

All real estate is local but market predictions are always interesting. The ups and downs of a market are very specific to where in the USA it is located. However, there are national trends that can be seen and used as a guide for what to expect in the real estate market this year.

For instance, we expect to see more homes sold in 2017 than in 2016, with slightly higher interest rates (perhaps up a ½ percentage point), and with a 3 to 4% higher cost than last year. Appreciation last year was about 5 -6%.

Just Listed

Just Listed

As much as we love to see the value of our home increase, we don’t want to see that change year to year too greatly. We have all had our fill of rapid home price increases, and subsequent rapid value decreases. So a gentle uptick is pretty comforting these days when most of us consider our home to be our largest financial asset.

However, we do have inventory woes. Despite increasing home values, many homeowners are not eager to sell. Because of the lack of replacement inventory, the high price of that replacement inventory and the fact that so many homeowners just refinanced their homes and plan to stay put longer, our inventory is very low right now. For instance, in February 2016, there were 961 single family homes (all types) listed in San Luis Obispo County. In February 2017 there were 717 homes listed. That’s big drop in available homes.

More people want to live here.  But during the recession only a handful of homes were constructed. The City of Paso Robles once had a moratorium on the number building permits that could be issued each year.  Now they are lauding any new construction that is coming online.

When we have more buyers than sellers, the existing inventory sells more quickly and at a higher price. Prices will naturally increase. It’s not real estate agents who drive the market, it is the market that drives the market. And 2017 looks like it will be a driven market.

I was recently searching for an investment property for a client and in Paso Robles, between $300 and $400,000 I only had 10 properties for her to even consider. After reviewing the inventory, there was only one she was interested in viewing. Now we are in a “let’s see what comes up next” mode. In fact, I have 2 or 3 clients in the same boat. We are actively waiting and searching for what they want.House Framing

My market predictions say that it will be an interesting market this year.   Very often the Spring is the busiest season, but with the afore mentioned statistics, the entire year may be strong to the end.

If you plan to purchase or sell this year, it is best to contact your real estate agent (hopefully me) now.   Planning ahead will be your best strategy!

And Always Expect the Best!!

 

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Come See the Amazing Salinas River

Posted on March 13, 2017 by Joanie Williams

Come See the Amazing Salinas River

The Salinas River is an amazing resource in North SLO County that many of us who live here do not fully appreciate. The beauty within its banks can be seen year round and the

Mid Summer Beauty

Mid Summer Beauty

benefits are always available. The ‘upside down’ river that flows out of the Los Padres National Forest near Pozo flows from south to north, and is most often flowing underground. However, most of the year the Salinas River can be seen near the Templeton/Vineyard Bridge where the water table is highest. There are also portions South of the 41 Bridge where it can be seen because there are so many beaver dams holding it back.

I have been hiking and riding in the Salinas riverbed for over 14 years now and have seen many changes and much beauty. When the water is really flowing after heavy rains, the channels and trails will redirect each year. And new life will spring up wherever the water runs. The fish and frogs, the willows and flowers: it changes throughout the year as the water subsides and the heat beats down.

Here is a perfect place to see just how much water we had in the river this year!  Take a look!

River Ride to Remember

The Salinas River is home to many coyote, cottontails, jack rabbits, road runners, fox, bobcat, turkey vultures and hawks, snowy egrets, killdeer, and green backed herons. And the plants and flowers are fantastic year round.

You can hike, ride your horse, run your dog and hunt for arrowheads and special rocks as I have seen so many people do. The smells of sage and sun, and the restful shade under a towering oak or sycamore are pleasures that are too often missed by so many in our busy lives.

Pack a lunch and some water. Drive to the parking lot behind Home Depot on Ferrocarril and take a hike. There are plenty of river trails to explore as well as trails installed by the Atascadero Mutual Water Co. to access the wells that the Water Company owns. They welcome you to use their trails respectfully.

Just please don’t leave any trash. Many of us who regularly walk the river pick up the trash that others leave, and the riverbed is so much cleaner now than it was 14 years ago. If you see any trash, just help us out and pick it up. It will make it so much nicer for the next hiker or rider.

River RideIt may be called the ‘upside down’ river, but it’s always the ‘right side up’ river to visit!

And Always Expect the BEST!

 

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2016 Real Estate Review and 2017 Real Estate Forecast

Posted on January 26, 2017 by Joanie Williams

2016 Review and 2017 Real Estate Forecast

This real estate report looks back at 2016 North San Luis Obispo County and projects market activity and a 2017 real estate forecast. While the past certainly does not equal the future, we try to provide insights to help you make good decisions regarding real estate.

Residential home sales stayed on par with about 1600 homes sold for 2016 which is similar in number to 2015. The average price of in-town homes reached $396,000 small housereflecting a 6% increase over 2015. Pending sales going into the New Year are higher than 2015 which I believe reflects a change to a more confident consumer. The inventory for single family homes for sale is up 30% which reverses a trend over the past few years and points toward a more balanced market between buyers and sellers

Going forward, it appears that home sale price increases will stay modest in the 5% range or less. Slow appreciation is healthy. Rising interest rates are expected and will impact sales in a modest way. Sellers are starting to reduce asking prices if their property is sitting. These reductions are happening State-wide. Sellers always get ahead of the market asking prices. These reductions do not mean a drop in value, but reflect pricing more consistent with the market.

For the first time in years, lots and land sales increased 30% year to year. There is more building and asking prices have dropped to a level where buyers see value and opportunity. We think that pricing for land will be strong in 2017. A note of caution still exists for land parcels within the groundwater ordinance overlay.

High-end existing homes, vineyards and wineries all experienced a bump in activity over 2015. Million dollar homes are reasonably priced and certainly appear to be good deals when compared to the strong residential prices. Agricultural buyers are going after already planted vineyards. The water restrictions make existing properties more valuable. More existing wineries will sell in 2017 because building from scratch is difficult for many reasons.

IMG_5367This 2017 Real Estate Forecast is based in part on the booming North County tourism. Our wineries are selling wine at a decent pace. Commercial activity continues to move forward at a steady pace. Atascadero has lagged behind the commercial pace as compared to Paso Robles. Industrial activity is good based on user demand. Home rents are very strong.

North County is an inbound destination for tourists and urban refugees looking to relocate on a permanent or part-time basis. Urban and baby boomer refugees could create a sustained demand for the North County lifestyle we love so much.   Some people are leaving the State but we see buyers walk through our doors at RE/MAX all the time. We are a great value. Maybe better than ever.

Always Expect the Best!!  smsignature copy

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Current Real Estate Review

Posted on November 4, 2016 by Joanie Williams

2016 Third Quarter North County Real Estate Review 

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This is a Real Estate Review for our North San Luis Obispo County real estate. All real estate is local. We hear lots of news in the media, but it’s what happens here that affects your decision making. It’s what really matters to you.

Residential single family home sales were even in volume with 2015 and prices rose 5% to an average sale price of $396,000. Homes on acreage were also even in volume with 2015 and the average sale price of $653,000 reflected a similar 5% increase over the comparable 2015 period. The number of homes for sale dropped 7% as inventory is down to about 3 months.

Where are the Sellers? They continue to sit on the sidelines and watch the game. Many still cannot sell for what they believe their home is worth. It may be quite some time before we see 2006 pricing again. We also have fewer “move up” buyers as our large Baby Boomer population is aging and choosing smaller homes. Downsizing has become very popular.

Million dollar home sales increased a bit over 2015 and average sale pricing actually young-grapes1increased 4% year over year.   Million dollar homes for sale increased 24% in 2016 over 2015. This market has been selective and less robust throughout the recovery. Demand has been consistent but supply is way ahead of absorption.

Vineyards and homes with vineyards are finally seeing some consistent action. The water ordinance has stopped all Eastside planting. Slowly growers and investors are realizing that the only way to be in the Grape Business is to by existing vineyards. Most grape varietals are firm in pricing which is an added bonus. Buyers of vineyards today are protected from an increase in supply by the ordinance.

Commercial properties are in the best position since 2008. Vacancies still exist but there is a lot more actual user activity at this time. Tourism is super strong and growing. Apartments are in demand by tenants and investors. Financing is still a challenge across the board.

Home prices may be entering a plateau phase. There is an inverse relationship between interest rates and asset prices such as homes. It seems that interest rates have found a bottom and in fact expectations seem to be in minor rate increases. Residential rates seem to have stabilized

Spanish Lakes HomeNorth County has risen to the challenge of competing in a no growth economy. Our city government works. The wine industry has created an environment that attracts high quality consistent tourism dollars. Every weekend it seems we are celebrating life! Perhaps our greatest asset is the community spirit inherent in our citizens. We have a healthy respect for our past and generous attention to our future. Who has it better than we do? Nobody!

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Real Estate Facts Please!

Posted on March 22, 2016 by Joanie Williams

The Real Estate Facts Today

Real estate facts and the real estate market are constantly changing.  Here is some very current national and local information to help guide you on your way.

I recently heard Jonathan Smoke, the Chief Economist for Realtor.com speak about the market today and provide current real estate facts.  The market we are in right now.  This is always valuable information to me because as an agent, I can be in the middle of helping people buy and sell homes and not really have time to poke my head up from my escrows and see what is happening all around me.  And it’s always good to get the perspective of an economist!

Jonathan Smoke spoke on a national level, but everything he said can be applied to real estate right here in San Luis Obispo County.  Today, we have great demand and not enough supply.  Lots of people wanting to buy and not enough houses.  We have a supply of 4 months of product, meaning, if no new homes are listed today, all of the homes currently on the market will sell in just 4 months.  That’s considered low inventory.  Average, and a balanced market is about 6 months of inventory.

We are just now starting to see new construction popping up around us.  That new construction is great, but far behind filling the need for housing all around us.  House FramingIt does show that prices have risen to enough of a high that builders can again build and make a profit and that’s a great real estate fact.

While credit is beginning to loosen a bit, it’s actually the buyers who are helping themselves more than the banks.  They have been frugal, paid off debt, and are coming in with equity from the homes they are selling, good credit scores, job security and are finding the banks are willing participants.

The foreclosure crisis book can be closed.  Foreclosures today make up only 1% of the market.  And homes that are in serious deliquency are at the lowest number in 8 years.

AG Westside House

AG Westside House

With low inventory nationwide, there is only one category of home that is still in a weak position.  The luxury home market, which was greatly influenced by foreign buyers, is still struggling.  And our foreign buyer market has declined because of the struggling world economy.

The good news for homeowners is that demographically speaking, the next 10 to 15 years will see a rise in home buying.  The boomer generation continues to move up, move out and move on.  At the same time their children are coming into their prime buying years.

While our median sale price of 2006 ($521,000) has not yet returned, and may not return for a number of years, there is solid growth in the market, solid interest and prices this SpringGreen up arrow are on the rise.  Our median sales price today is approximately $449,000.  A far cry from a low of $281,000 in 2011.

The new is good.  The market is good.  We’ve had some great rainfall this year.  And Spring has Sprung!  So call me if you or someone you know needs help with a move.  I’m ready!

And “Always Expect the Best!”smsignature copy

 

 

 

 

 

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So You Want to Buy a House?!

Posted on March 14, 2016 by Joanie Williams

So you want to buy a house?

It’s always an adventure to jump into a big pool of water, but wisdom dictates that you check out a few things first: like the depth of the pool, the temperature, and whether or not you can swim before you should buy a house!taking the plunge1

So, when you are ready to buy your first home, here are a few pointers which may help you along the way…

  • Do take a longterm approach to what it is you want to buy. This is a serious purchase and is not like buying and selling stocks. Real Estate is not a liquid asset. It’s conversion back into hard dollars can take months and months and if you did not plan well, you may not be able to sell it quickly or convert it back to any cash at all.
  • Do always think RESALE!  If there is something of concern to you today, that issue could be 10 X’s worse in 10 years when you want to sell. Think ahead.
  • small houseDon’t buy a house because you love the furniture and decorating inside. It will be going away soon. On the contrary, don’t pass on a house because your Grandma’s dining set doesn’t fit into the dining room. Furniture can easily be changed. The location, amenities and floor plan are tough to change.
  • Do visit the neighborhood a number to times. Morning, evening and weekends. Consider the street parking, children, bikes, parties, dog barking,  noise levels….
  • Do set a realistic budget with a lender, and obtain a pre-approval before even putting your toe in the water. And don’t go overboard! You may qualify for a $750,000 house, but look at what that payment means to your monthly budget. Perhaps you can find what you want in the $650,000 range and still have money left over each month in your entertainment budget.
  • Do obtain a professional home inspection. It is the wisest advice I can give you, and well worth the price for how much you can learn about this very large, important purchase. You might even change your mind and find a different pond to jump into!

taking the plunge2This is just a partial list of things to think about before you buy a house. Having worked with buyers for over 27 years, and bought and sold many properties, I know that the experience of a professional will help you avoid the pools too shallow, the currents too strong, and show you how to be properly dressed for your first plunge!

 

And “Always Expect the Best!”smsignature copy

 

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The Salinas River and El Nino 2016

Posted on February 29, 2016 by Joanie Williams

The Salinas River and El Nino in 2016

Salinas River February 2016

Salinas River February 2016

This is a typically dry section of the Salinas River between Templeton and the Hwy 41 bridge in Atascadero.  The water only appears here when the water table below is full and this is essentially the overflow of a full basin.  Even in an El Nino year when the rain we expected has not appeared in full force, a few good rains can reveal this abundant resource in our area.

The Salinas River is an amazing resource.  Any city or town which is privileged to have a river flowing through it, is blessed indeed.  This riverbed houses a wealth of wildlife, from frogs to bobcat.  I have seen deer, coyotes, fox, kit fox, red tailed hawks and a myriad of birds here including snowy egrets and green backed herons.

Flowers of the SalinasIt is amazing each year to watch how this resource bounces back to life so quickly and continues to produce plant life for the critters, and wildflowers for our viewing pleasure.

We need to remember what a special resource this is and care for in every way we can.  It’s a wonderful place year round to walk your dog, ride your horse, mountain bike or simply find a quiet place to reflect.

Please remember to carry out anything you take in.  Many volunteers help to clean up the riverbed and each year a community clean up day is organized by the Atascadero Mutual Water Company.  Anything you can do to help is appreciated!  Now go enjoy this amazing resource!

And “Always Expect the Best!”Flowers of the Salinas

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