2018 C.A.R. Reports from Sacramento are in!
This May, NSDCAR sent your C.A.R. Directors to Sacramento to represent you in the C.A.R. decision making processes for 2018. The following reports will inform you of the pressing issues discussed in Sacramento this year. With topics ranging from the Housing Affordability Fund to Managed Retreat and everything in between, you will definitely get informed on the topics affecting how you do business in 2018 and beyond.This year we have provided them in an easy to use PDF document. Click Here to View in downloadable PDF format
Housing affordability improved statewide in the first quarter 2018 due to higher wages and lower seasonable home prices, according to the California Association of REALTORS®’ (C.A.R.) “Housing Affordability Index” (HAI). C.A.R. said 31 percent of California households could afford to purchase the $538,640 median-priced home in the first quarter of this year, up from 29 percent in fourth-quarter 2017 but down from 32 percent a year ago. In San Diego County, only 26 percent of households could afford to purchase a median-priced home in the first quarter, which remained unchanged from the previous quarter but down from 28 percent in the first quarter of 2017.
C.A.R. said it was the 20th consecutive quarter for its HAI index to be below 40 percent. California's housing affordability index hit a peak of 56 percent in the 1stQ of 2012. C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. The index is considered the most fundamental measure of housing well-being for homebuyers in the state.
To afford the statewide median-priced single family home of $538,640, a household would need a minimum annual income of $111,500 to make the necessary $2,790 monthly payments, according to 1stQ C.A.R. figures. The payment would include principal, interest, and taxes on a 30-year, fixed-rate mortgage with a 20 percent down payment and an effective composite interest rate of 4.44 percent. The effective interest rate in the 4th 2017 was 4.17 percent and 4.36 percent in the 1stQ 2017.
C.A.R. also said that the affordability of condominiums and townhomes improved slightly in the 1stQ 2018. C.A.R. said 39 percent of California households earning the minimum income could qualify for the purchase of a $449,720 median-priced condominium or townhome in the 1stQ 2018, up from 38 percent of households who could afford to purchase in the 4thQ 2017. An annual income of $93,090 would be required to make monthly payments of $2,330 in the 1stQ 2018.
In addition, C.A.R. recently released its April homes sales and price report. C.A.R. said April’s statewide median home price was $584,460, up 3.5 percent from March and 8.6 percent from April 2017. In San Diego County, the median sales price of an existing single-family home was $635,000 in April, 1.5 percent higher than the $625,400 sales price figure for March 2018 and 7.6 percent higher than the $590,000 sales price figure for April 2017.
The median number of days it took to sell a California single-family home remained low at 15 days in April, compared with 16 days in March and 17 days in April 2017. Meanwhile, in San Diego, the median number of days a home remained unsold on the market was 11 days in April 2018, compared to 12 days in March 2018 and 11 days in April 2017.
C.A.R. said existing, single-family home sales totaled 416,790 in April on a seasonally adjusted annualized rate, down 1.7 percent from March and up 2.2 percent from April 2017. April was the first time in nearly three years for the number of available homes for sale to increase following nearly two consecutive years of double-digit declines in active listings, C.A.R. said.
“After nearly three years of decline in active listings, we’re finally seeing an improvement in the availability of homes for sale, which is encouraging for prospective buyers as we enter the busy spring home-buying season,” said C.A.R. President Steve White. “However, entry-level buyers may continue to experience the housing shortage as homes priced under $300,000 continue to bear the brunt of inventory issues.”
“After increasing year-over-year by more than 8 percent for the past three months, the California median home price is close to striking distance of the pre-recession peak price of $594,530, which was recorded in May 2007,” said C.A.R. Senior Vice President and Chief Economist Leslie-Appleton-Young. “With a continued imbalance of supply and demand, we’ll likely break previous price records, which many areas have already done, before the summer is over.”
In other recent real estate news according to news reports:
-- CoreLogic, an Orange County-based real estate information service, said San Diego County’s median home price hit an all-time high of $570,000 in April, increasing 8.6 percent in a year from $525,000 in April 2017. April’s all-time high figure surpasses the previous peak of $550,000 set the previous month of March. The increase was largely led by the rising price of resale condos, going up 11.7 percent in a year to a record high median of $430,000. The median price of a resale home reached a record $610,500, while the newly built home price was $707,500. While the rising prices are notable, they still technically lower than prices at the height of the housing boom. In November 2005, the median hit $517,500, which would be more than $655,000 today after adjusting for inflation.
-- CALmatters, a news media outlet covering state policy issues in California, recently identified several reasons why California ’s housing costs are so high. At its most basic level, it’s a story of supply and demand: Lots of people want to live here and there aren’t enough homes to go around. Among the reasons: We haven’t built enough housing; Demand to live and work and own in urban areas has reached a breaking point; In most parts of California, the process to get new housing approved is difficult, time consumer and expensive; Land, labor and raw material costs are higher in California than the rest of the country.
-- Is a housing bubble coming? Probably not, according to one mortgage insurance company. Arch MI says there’s only a slim chance Southern California home prices will fall in the next two years. Arch MI gauged the economic foundations of home values in 100 major metropolitan areas to determine local housing markets with “minimal” risk. Locally, Arch MI found solid performance among regional businesses and limited development of new homes as factors that should keep home prices firm.
The North San Diego County Association of REALTORS® (NSDCAR) has announced its endorsement of two candidates for countywide elected offices for the June 5 election. Those candidates include Bonnie Dumanis for County Supervisor District #4 and Ernie Dronenburg for San Diego County assessor-recorder-clerk.
NSDCAR’s Local Government Relations (LGR) Committee recommended the two endorsements to the board of directors, which then ratified the recommendation. The LGR Committee is involved in political advocacy and public policy and its impact on NSDCAR members and the real estate industry. In addition, LGR members are involved in addressing a variety of complex and multi-dimensional issues that relate to the protection of private property rights, as well as candidate endorsements.
Dumanis, a former judge and prosecutor, is one of five candidates vying to succeed six-term Supervisor Ron Roberts. Dumanis previously served four terms as San Diego County District Attorney. In 1994, she was elected Judge on the San Diego Municipal Court. In 1998, she was elected Judge on the Superior Court where she pioneered the “Domestic Violence Court” to reduce recurrences of abuse. She also created one of the first Drug Courts in San Diego County, which was recognized as a national model.
In 2003, Dumanis challenged the sitting DA, winning a race no one thought she could, while making history as the first openly gay prosecutor in the country, and the first female DA in San Diego history. As District Attorney for nearly 15 years, Dumanis built a partnership with other law enforcement agencies and community groups to help make San Diego one of the safest big cities in America. When she left office in 2017, crime was at a 47-year low.
In response to the question, “What is the single most important issue that led you to run for county supervisor,” Dumanis answered: “For the last 35 years, as a judge and the district attorney of San Diego County, I have seen the tragedy that has been created by the undertreatment of our mentally ill in the county. They are the homeless, jobless, victims and the offenders ending up in our criminal justice system. This is a problem that needs to be solved as a society, not by the criminal justice system. As county supervisor I can use the experience and evidence-based practices to prevent these tragic outcomes from occurring. There is no reason our jails should be our biggest mental health provider.”
Among Dumanis’ other endorsements: Deputy Sheriffs Association of San Diego County, District Attorney Investigators' Association, Latino American Political Association, Lincoln Club of San Diego, Oceanside Police Officers Association, San Diego Asian Americans for Equality. San Diego Regional Chamber of Commerce, Southern California Alliance of Law Enforcement, San Diego Mayor Kevin Faulconer.
Dumanis’ campaign website is www.bonnieforsupervisor.com.
The 100-square-mile District #4 is perhaps the most diverse district in San Diego County with a population of approximately 630,000. It includes most of the city of San Diego, and spans La Jolla to Kearny Mesa, Encanto, Downtown and Ocean Beach.
Meanwhile, Dronenburg is seeking reelection for a third term to the nonpartisan office. He was first elected to the office in 2010 and re-elected in June 2014, when he received 59 percent of the vote, resulting in no runoff election that year. His June 2014 reelection was won by a 28-point spread.
Dronenburg has 20-year track record of advocating for taxpayers. Histrack record includes lowering property values, which provided tax relief to hundreds of thousands homeowners so they could remain in their homes. Soon after taking office in 2010, Dronenburg reduced property taxes on more than 310,000 properties in San Diego County. At the time, the housing market was still reeling from impact of the economic recession and many homeowners had lost value in their homes.
Under Dronenburg’s leadership, the county office has implemented innovative technology so that taxpayers can conveniently do business with his office online rather than driving to his office to stand inline. Dronenburg was California’s first and only Assessor Office to implement online forms with secure electronic signatures. Dornenburg also led a document digitalization process saving the office from printing more than 650,000 pieces of paper annually and allowing more taxpayers to be served at regional offices. He also has established advisory to better serve the senior citizen and disabled veteran communities. San Diego County’s assessor-recorder-clerk’s office serves more disabled veterans than any of California’s 58 counties.
Also, under Dronenburg, the office has improved customer service, receiving a 98.3 percent positive customer survey rating and a 4.5 stars out of 5 stars rating on YELP.
Prior to serving as the county’s assessor-recorder-clerk, Dronenburg spent 20 years with the California State Board of Equalization (BOE), including five years as chairman. At the BOE, he advocated for taxpayers and authored the California Taxpayers’ Bill of Rights and implemented the original Prop. 13 regulations that limit property taxes to 1 percent of a property’s assessed value. Dronenburg remains a staunch advocate leading statewide protection of the famous Prop. 13 law, which he says keeps homeownership affordable and lowers both residential rents and the ability for small business owners to operate.
Dronenburg grew up in San Diego and graduated from Crawford High School and received a bachelor’s degree in business administration from San Diego State University. He served in the U.S. Coast Guard, and has served on the boards of several community groups, including the Salvation Army and National Multiple Sclerosis Society
The office of the County assessor-recorder-clerk typically draws little public attention, however nearly every county resident who owns property or rents is affected by what happens there. As county assessor, Dronenburg oversees assessing the value of real estate and personal property, which in San Diego includes planes and boats. Property taxes constitute the largest share of revenue for the county. His work also involves registering business names and issuing marriage licenses, birth and death certificates. The office has a $71 million budget with 405 employees and five offices in San Diego County. Dronenburg’s office has returned an average of $3.2 million of his annual budget to the County general fund. His office is forecasting to return over $5 million in 2018.
As a California Certified Property Tax Appraiser for over 10 years, Dronenburg is the only candidate in the race who meets the legal requirement to hold the office of assessor-recorder-county clerk.
“I feel that qualifications and experience matters and I’m the only candidate with the knowledge to understand the technical nature of property taxes to protect homeowners and the certification necessary to legally hold the office,” said Dronenburg, a Fallbrook resident who lives on a flower farm. “I’ve been successful with implementing technology innovation and brining the private sector revolution to the public office.”
“Our staffs have worked together for years to the benefit of taxpayers and we want that working relationship to continue,” said Dan McAllister, San Diego County Treasurer-Tax Collector, who has endorsed Dronenburg.
Greg Smith, former assessor-recorder-county Clerk, also has endorsed Dronenburg. “Ernie is far and away the superior choice for the office,” said Smith. “He embodies fiscal responsibility and is a true taxpayer advocate.”
Among Dronenburg’s other endorsements: San Diego County Deputy Sheriff’s Association, San Diego Police Officers Association, National Electrical Contractors Association, the Latino American Political Association and the Howard Jarvis Taxpayers Association, considered California’s leading bi-partisan taxpayer organization. In addition, Dronenburg has received the endorsement of members of the San Diego County Board of Supervisors, the County Treasurer-Tax Collector and several city mayors (Carlsbad, Coronado, El Cajon, Escondido, National City, Poway, San Diego, San Marcos, Santee) as well as members of city councils, school boards, water boards and healthcare district boards countywide.
Dronenburg’s campaign website is www.voteforernie.com.
Below please find links to the proposed amendments to the Bylaws of the North San Diego County Association of REALTORS® as recommended by the Board of Directors to be placed before the membership for a vote to take place at the same time and on the same ballot as the Annual Election in June 2018. Click the link below to review. Notice of Proposed Bylaw Amendments - 2018
NSDCAR REALTOR® member Jackie Camacho, a San Marcos resident, grew up in North County and graduated from Mission Hills High School (class of 2007). She purchased her first property at age 22 in 2012. Then, in August 2014, she earned her real estate sales license. She has been with Realty One Group since March 2017. Along with teammate Lazaro “Laz” Castillo, more than 80 percent of her real estate clients are millennials. Jackie recently shared her thoughts about serving millennial clients in her real estate practice.
-- Don’t ignore us:
Today’s millennials represent the largest group of potential homebuyers, and older agents should not discredit the younger generation. Just because they show-up in jeans and flip-flops doesn’t mean millennials are not serious and qualified. Don’t ignore them. Do not be skeptical of them. Zillow said that millennials make up the largest segment for first-time buyers, and half of them are under age 36. Zillow also said that 66 percent of millennial homeowners are white, 17 percent are Hispanic or Latino, 10 percent are African American, 7 percent are Asian or Pacific Islander.
-- Millennials are savvy clients:
Before talking to a potential millennial client, you can assume that they have already done lots of research on their own. There are so many online resources available that in most cases they already know about their favorite neighborhoods, what houses are selling for in those areas, what parks and stores are around. They already know that homeownership is a powerful way to build wealth and they are overpaying such high rent rates. And, they tend to be money savvy, when they have a goal they save for it.
-- What millennials need from real estate professionals:
You can assume that millennials are desirous to own a home, they just may need more guidance and direction. They desire to own a home because they know that a home can provide emotional stability, safety, financial independence and it’s a time-proven path for wealth accumulation. Millennials have not turned their backs on homeownership. But, their vision may be clouded by misinformation. They may need education about the home buying process. They want to dialogue and know how to make homeownership possible. What kind of financing is available, down payment assistance, and your expert opinion on where their budget places them. So, I would encourage my fellow NSDCAR members to take every opportunity to explain the benefits of homeownership, including stability, price appreciation, a secure path to wealth and asset accumulation, to name a few.
-- How to communicate with millennials:
80 percent of our clients are millennials, and our initial point of contact 80 percent of the time is either through a text or a social media platform, such as Facebook, Messenger, Instagram or Snapchat. The first contact with a millennial buyer will probably not be by phone call because millennials have so many options for communicating. They may not have the time for lengthy phone conversations. A text would be better and a speedy reply is expected.
-- What’s important to millennial buyers:
Most millennial buyers already have a good idea of what they’re looking for. Because some are delaying starting a family, we have had buyers who placed a higher priority on whether the backyard is big enough for their dog. Others want their home to be energy efficient. Others are concerned about proximity to coffee shops, grocery stores and retailers.
-- What’s preventing millennials from homeownership:
In addition to low inventory and affordability concerns, a recent Experian study revealed several reasons why potential millennial buyers are delaying or avoiding homeownership. Some of them want more flexibility to relocate than owning a house might allow. Others have little desire to carry as much debt as is required to purchase a home. Still, others worry about their ability to afford a home with sizable student debt. According to Pew Research, a growing number of millennial women are prioritizing their education and careers over marriage and buying a home.
-- Why I like to work with millennial clients:
Other than the fact that I am one, I get a great sense of satisfaction and fulfillment when I help others with their goal of sharing in the American dream of homeownership. I’m excited about my job and look forward to it every day