Rancho Santa Fe real estate (defined for the purpose of this analysis as all attached and detached residential properties listed with the San Diego Multiple Listing Service for the 92067 and 92091 zip codes) continues to perform strongly. Overall, the first 6 months of 2013 look very similar to its first quarter, except inventory is not as depleted. Specifically, average daily inventory for the first 6 months of 2013 was 111 properties versus 98 properties for the first quarter of 2013. Despite inventory climbing during the second quarter of 2013 relative to the first, inventory is down 8% when comparing the first 6 months of 2013 to the first 6 months of 2012.
Rancho Santa Fe Real Estate: January – June 2013 Performance Summary
For this semi-annual year-over-year contrast, sales have increased nearly 19% with marketing times declining 37%. During this 6-month time period, 129 properties were sold in 2012 compared to 153 in 2013. With such a jump in sales, one would suspect hints of either longer marketing time lines and/or price discounting, yet neither surfaced. Average marketing time shrunk from 274 days in 2012 to 173 days in 2013 with overall median sold price remaining constant at $2,100,000. As we will see below, it was incongruent sub-market behavior that created this overall market performance.
Original Listing Price: less than $3 million
Three months ago, the median sold price for this sub-market for the first quarter of 2013 was $1,600,000. Today, the median sold price for the first 6 months of 2013 is $1,890,000. Of all three sub-markets presented here for Rancho Santa Fe, properties with an original listing price less than $3,000,000 has had the highest value appreciation when comparing median sold price for the first 6 months of 2012 to the same time period in 2013. Median sold price has increased 29.7% for this time comparison. Not only that, but the number of properties sold have increased 30% from 84 in 2012 to 109 in 2013. All this happened while marketing times fell 41% from 205 days in 2012 to 121 days in 2013. None of this has gone unnoticed by sellers either. For this 6-month time period in 2012, on the median, sellers were discounting from their original listing price nearly 14% to final sales price. This year, they are discounting only slightly more than 7%. From all angles, nothing appears to be in the way of further seller strength in this sub-market.
Original Listing Price: $3 million - $5 million
A semi-annual year-over-year analysis of this sub-market yields rather static results, except for the number of properties sold. Every other primary indicator remained essentially unchanged when comparing the first 6 months of 2012 to that of 2013. The number of properties sold increased 13.3% from 30 in 2012 to 34 in 2013. While median sold price remained almost flat at -2.4%, the discount sellers were taking off their original listing price to make a sale decreased on a relative basis nearly 30%, going from a median discount of 22% in 2012 to 15.5% in 2013. This could be due to sellers pricing their properties closer to the market or sellers sensing some weakness in the market, thus starting with lower overall original listing values.
There is some evidence of that latter. While inventory only declined 3.6%, new listings increased 27.5%. With only a 13.3% increase in sales and average marketing time going unchanged, a substantial increase in new listings could create market softness which sellers may be bracing for with slightly lower overall original listing values. However, these new listings could also create some sub-market strength by supplying greater property selection in a submarket already constrained by low inventory.
Original Listing Price: $5 million or more
Of all the sub-markets listed here, this was the only one to experience fewer sales for the first 6 months of 2013 than that same 2012 time period. There were 33.3% fewer properties sold. 15 in 2012 versus 10 in 2013. However, there is more to the story. Median sold price increased 12.9% from $4,650,000 to $5,250,000.
3 months ago, when I wrote about the first quarter of this year versus that of 2012, there was actually a median value decline in this sub-market from $4,767,500 in Q1 2012 to $4,600,000 in Q1 2013. This turned around during the second quarter of 2013. Albeit sales are down, median sold price is up and marketing times are contracting. Average marketing time for all properties sold in this sub-market for the first 6 months of 2013 declined 47.1% compared to the same time period in 2012. Sellers are obviously holding out for price and a few astute buyers are sensing that this sub-market may have nowhere else to go, but up. Consequently, I believe this sub-market is currently characterized more by the positive direction of its median value and time line, than its sales activity.