Best of Carmel and Pebble Beach ~ 1913 Magazine, Luxury By The Sea

Extra, Extra, read all about it  . . .

Carmel Beach with the Pebble Beach Golf Links in the background

Hot off the presses!! Carmel Realty Company in Carmel, CA has done it again.  The leading luxury real estate firm in Carmel has just come out with its latest issue of their in-house magazine just in time for the AT&T Pro Am Golf Tournament that attracts thousands of visitors to the Monterey Peninsula the first week of February.

As a realtor with Carmel Realty, I’m proud to say our amazing “1913 Luxury By The Sea” magazine is out and may just be the best one ever! Chock full of all our beautiful listings plus some wonderful features highlighting our area and agents. It is a must have if you love Carmel and the Monterey Peninsula!

Enjoy this digital copy or ask me where you can get your own glossy color hard copy.

1913 Magazine ~ Luxury By The Sea

1913 Magazine  ~ Luxury By The Sea

Susan Clark with her amazing support staff at Carmel Realty Company

It has been my honor to serve the Monterey Peninsula as a realtor for the last 22 years and am so glad to have the support of the fabulous team surrounding me. Pictured is our amazingly talented in-house marketing agency, efficient transaction coordinators and admin staff, and experienced managers. We also have an entire property management team for vacation and long term rentals and concierge services (mostly not pictured).

We can satisfy all of your real estate needs. Call. me!

Susan Clark, realtor at Carmel Realty Company, 831-320-6801

Note: Banner photo by Susan Lambert

 

 

2023 Real Estate Outlook ~ Carmel ~ Pebble Beach

 

2023 Real Estate Market Outlook (And What It Means for You) 

First of all, I hope all of you are safe and dry and weathering our Central Coast/Bay Area storms well. All of you reading this blog are either past clients, present clients, friends, associates, or someone who I have met along the way – in other words, you’re all people I care about so take care and stay safe.

As soon as we see the calendar turn to a new year, as realtors, we take a look back at what has happened in the previous year and then try to project what the new year will hold for us.  Our analytics team at Carmel Realty Company is putting together all of our local statistics which I will be providing you in about a week. Today I’m going to share some general national real estate information that I think will be very helpful for looking at the whole picture.

Pebble Beach coastline ~ photo by Susan Clark

Last year, one factor drove the real estate market more than any other: rising mortgage rates. 

In March 2022, the Federal Reserve began a series of interest rate hikes in an effort to pump the brakes on inflation.1 And while some market sectors have been slow to respond, the housing market has reacted accordingly.

Both demand and price appreciation have tapered, as the primary challenge for homebuyers has shifted from availability to affordability. And although this higher-mortgage rate environment has been a painful adjustment for many buyers and sellers, it should ultimately lead to a more stable and balanced real estate market.

So what can we expect in 2023? Will mortgage rates continue to climb? Could home prices come crashing down? While this is one of the more challenging real estate periods to forecast, here’s what several industry experts predict will happen to the U.S. housing market in the coming year.

Monterey Peninsula Shore Course during the AT&T Golf Tournament, photo by Susan Lambert

MORTGAGE RATES WILL FLUCTUATE LESS

In 2022, 30-year fixed mortgage rates surged from roughly 3% in January to around 7%. According to Rick Sharga of real estate data company ATTOM, “We’ve never seen rates double in so short a period.”2

This year, economists forecast a less dramatic shift.

In an interview with Bankrate, Nadia Evangelou, senior economist for the National Association of Realtors, shares her vision of three possible mortgage rate scenarios:3 

  1. Inflation continues to surge, forcing the Fed to repeatedly raise interest rates. In that scenario, she predicts that rates could reach as high as 8.5%.
  2. Inflation decelerates and mortgage rates follow suit, averaging 7 to 7.5% for the year.
  3. Rising interest rates trigger a recession, which could ultimately lead mortgage rates to drop closer to 5% by the end of the year.

Realtor.com forecasts something similar to scenario #2 above: “Mortgage rates will average 7.4% in 2023, trickling down to 7.1% by year’s end.”4 The Mortgage Bankers Association, however, projects something closer to Evangelou’s scenario #3, with the 30-year fixed rate declining steadily throughout the year, averaging 6.2% in Q1 and 5.2% by Q4.5

Pebble Beach Golf Links during the AT&T, photo by Bob Borden

Economists at Fannie Mae fall somewhere in the middle. In a recent press release, they predicted that the U.S. economy will experience a “modest recession” this year.6 But in their December Housing Forecast, they project that 30-year fixed mortgage rates will only fall by half a point from an average of 6.5% in Q1 to 6.0% in Q4.7

“From our perspective, the good news is that demographics remain favorable for housing, so the sector appears well-positioned to help lead the economy out of what we expect will be a brief recession,” said Fannie Mae Chief Economist Doug Duncan.6

What does it mean for you?  Even the experts can’t say for certain where mortgage rates are headed. Instead of trying to ”time the market,” focus instead on buying or selling a home when the time is right for you. There are a variety of mortgage options available that can make a home purchase more affordable, including adjustable rates, points, and buydowns—and keep in mind you can always refinance down the road. I’m happy to refer you to a trusted mortgage professional who can outline your best options.

Sea Otter with her pup in Monterey Bay ~ photo by Peter Monteforte

SALES VOLUME WILL FALL AND INVENTORY WILL RISE

It looks like the home-buying frenzy we experienced in recent years is behind us. While the desire to own a home remains strong, higher mortgage rates have made it unaffordable for a large segment of would-be buyers. 

Many economists expect the number of home sales to continue to decline this year, leading to an increase in listing inventory and days-on-market, or the time it takes to sell a home. But, there is a wide range when it comes to specifics.

Economists at Fannie Mae forecast that total home sales will fall by around 20% this year before rising again by nearly 15% in 2024.7 National Association of Realtors Chief Economist Lawrence Yun projects a less extreme dip of 7% in 2023 with a rebound of 10% next year.8

Realtor.com Chief Economist Danielle Hale foresees something in between. “The deceleration in home sales is likely to continue as high home prices and mortgage rates limit the pool of eligible home buyers. We anticipate that existing home sales will decline another 14.1% in 2023.” She expects this drop in sales to lead to a nearly 23% increase in inventory levels this year, offering more choices for buyers who have struggled to find a home in the past.9

However, given the severe lack of housing supply, even with a double-digit increase, the market is expected to remain relatively tight and below pre-pandemic levels. Hale also points out: “It’s important to keep historical context in mind. The level of inventory in 2023 is expected to fall roughly 15% short of the 2019 average.”9

High surf off of the Pacific Grove coastline, photo by Susan Lambert

What does it mean for you? 

If you’ve been frustrated by a lack of inventory in the past, 2023 may bring new opportunities for you to find the perfect home. And today’s buyers have more negotiating power than they’ve had in years. Contact me to find out about current and future listings that meet your criteria.

If you’re hoping to sell, you may want to act fast; rising inventory levels will mean increased competition. I can help you chart the best course to maximize your profits, starting with a professional assessment of your home’s current market value. Reach out to schedule a  consultation.

Sanderlings on the Pacific Grove shoreline ~ photo by Susan Lambert

HOME PRICES WILL REMAIN RELATIVELY STABLE

While some economists expect home prices to fall this year, many expect them to remain fairly stable. “For most parts of the country, home prices are holding steady since available inventory is extremely low,” said Lawrence Yun (chief economist of the National Association of Realtors) at a November conference.8  

(Yun did note, however, that the San Francisco Bay Area may see some decreases in home prices, because the prices in these cities rose so much higher than in other areas.) Nationally, Yun expects the average median home price to tick up by 1% in 2023, with some markets experiencing greater appreciation and others experiencing declines.8   Economists at Fannie Mae offer a similar projection, forecasting a slight decrease in their Home Price Index of about 1.5%, year-over-year.7.  

Other experts foresee a larger fluctuation. Hale expects U.S. home prices to rise by 5.4% this year, while Morgan Stanley is forecasting a 7% drop from the peak in June 2022.9,10

Still, many economists agree that a housing market crash like the one we experienced in 2008 is highly unlikely. The factors that caused home prices to plunge during the Great Recession—specifically lax lending standards and a surplus of inventory—aren’t prevalent in our current market.10 Therefore, home values are expected to remain comparatively stable.

AT&T Pro Am Golf Tournament ~ Pebble Beach Golf Links, Pebble Beach

What does it mean for you? 

It can feel scary to buy a home when there’s uncertainty in the market. However, real estate is a long-term investment that has been shown to appreciate over time. And keep in mind that the best bargains are often found in a slower market, like the one we’re experiencing right now. Contact me to discuss your goals and budget. I can help you make an informed decision about the right time to buy.

And if you’re planning to sell this year, you’ll want to chart your path carefully to maximize your profits. Contact me for recommendations and to find out what your home could sell for in today’s market.

Floral Arrangement by Fionna Floral, Pacific Grove

Want to discuss the market? Call me, let’s talk about your options so you can decide what is best for you!

 

Susan Clark #00929953, realtor at Carmel Realty Company           831-320-6801

A Lifetime of Achieving Success for Others

www.StreetsofCarmel.com

For Community news and Susan’s interviews with  local Business Owners and Experts ~ Go to

www.parkbench.com/carmel-ca

Holiday Events in Carmel-by-the-Sea

Smuin Christmas Ballet

It’s beginning to look a lot like Holiday Time in Carmel!  

The village is dressed in glitter and lights and the famous Tree Lighting on Ocean Avenue has already happened. But have no fear that you’ve missed all the holiday celebrations – one of Carmel’s most anticipated events is happening this weekend! Every year San Francisco’s Smuin Ballet graces the Sunset Center with their “fiercely festive”  Christmas Ballet. It’s been a favorite of mine (and yes, my husband’s too!) for years. We never miss a performance.

Smuin Ballet in white

The 2022 edition of the Christmas Ballet returns December 9th and 10th with an evening performance Friday night and a matinee on Saturday. The Smuin ensemble will thrill and delight with a dazzling program of ballet, contemporary, character, Broadway jazz, and tap.

So, let’s ring in the holidays with Smuin’s “The Christmas BalletEvery performance is brimming with “sublime classical ballet set to carols and show-stopping contemporary works” danced to pop music favorites. The choreography is by Michael Smuin as well as inventive premieres by up-and-coming dance-makers. Every year new dances are added as well as bringing back old favorites. It will certainly be a treat for all ages. My husband and I usually go to the matinee which I love. I not only get to enjoy the ballet, but get to see all the excited faces of future ballerinas in the audience. Usually little girls about 8 years old in their pretty dresses and tutus.

Smuin Ballet

See you there for a “yuletide spectacular” that’s been called “sheer joy”!

White Christmas

 

 

Smuin Ballet

WHAT’S GOING ON IN THE REAL ESTATE MARKET? CARMEL ~ PEBBLE BEACH, CA

 

Sunset in Carmel

As the days get shorter and the temperatures drop, our lives experience the ever changing cycles of nature. And yes, our real estate market continues to have ever changing cycles as well.

I keep being asked, “What’s happening in real estate?”  So I thought I’d drop everyone a note, to give you some answers – as I see it.

Question: “How is the market doing?”

Answer:  First, it’s not the same as 2020-2021. These years became frenetic and crazy as a result of the Pandemic with huge price hikes and over asking bidding by buyers.

Everyone seemed to be reflecting on their lives and re-setting priorities and many decided to make changes about where they wanted to live. Plus working remotely  became possible opening up a lot of flexibility for people to live in places not necessarily close to where they worked. So . . . welcome to the Monterey Peninsula!

2 NW 3rd Avenue & Junipero, Sold in 2022

The market is down considerably from the spikes we saw during Covid; while the first half of the year held up stronger the second half’s decline has been a bit more rapid. 

However, this year we are reaching more normal numbers that are consistent with pre-covid times in terms of volume. We are still ahead in volume of 2018-2019 so we are in a healthy market.

The beautiful white sands of Carmel Beach

Question: How is the market doing and what’s happening with inventory?

Answer: The market is still pretty strong because inventory is low and demand remains high. We have many buyers with 228 listings available in the Monterey Peninsula markets which is lower than last year, but still very tight.

1044 Lost Barranca, Pebble Beach Sold in 2022

Question: What is happening with home values?

Answer: Home values are holding up better than transaction numbers. We’ve seen almost half the listings on the market go through price reductions with the average reduction being 9.1%

Last quarter we saw 315 sales that took place with sale prices going for 5.5% below asking on half of the homes. So overall prices are holding up pretty well.

Question: How is Carmel Realty Company doing?

Answer: As the market get tougher, the best perform. We are one of the top brokerages on the Monterey Peninsula that grew this year because our agents are the best. As a matter of fact, we have the highest producing agents as our agents do 44% more volume than any other brokerage. We are a small company, but mighty!

Susan Clark with her amazing support staff at Carmel Realty Company

Here I am with my amazing support staff (and many are not pictured). Our CEO, our managers, our transaction coordinator, our marketing and analytics team, our property management team, and accounting. We’ve added concierge services for our second home owners and we have long term and vacation rentals. We pretty much can furnish any kind of real estate need you have.

How could a woman go wrong, with this team behind me?

Call me for any real estate needs you may have.

Susan Clark #00929953 Realtor, Carmel Realty 831-320-6801

Recipient of the Carmel Chamber of Commerce Award of Excellence in Real Estate (small) for 2021

Web site:  www. StreetsofCarmel.com

 

Susan's Musings by the Sea