Tony Cannon

For all the published doom and gloom, Rancho Del Oro in Oceanside, CA continues to be a popular area for buyers due to it's good schools in either the Oceanside or Vista school districts, a convenient location, and an association doing it's job maintaining the grounds to preserve the look of the neighborhoods.

As of 1/27/09, there are only 28 Active listings of detached homes in the MLS and 20 homes are in escrow. I consider a normal inventory of Active listings to be about 40-50. Low inventory, low interest rates, and increasing number of sales should help prices stabilize. However, the banks controlling the short sales and foreclosure listings continue to price lower than prior sales. I don't think they really need to, but until they stop, they are driving the prices lower and hurting themselves and all the non-distressed sellers or existing owners in the process.

For those wondering which direction the market is headed, here is an area in Carlsbad that seems to be headed in the right direction. Part of the reason is this area does not contain many newer homes, so either local builders are not slashing prices and bringing down the values, or recent buyers who bought too much house are not foreclosing or doing short sales as much as many other parts of San Diego.

I used the Sandicor MLS looking at 6 month intervals from 2003-2008. Detached homes with an average size of 1900 square feet and built before 2000. Olde Carlsbad is an area east of I5, west of El Camino Real, south of Hwy 78, north of Cannon Rd.

If you find this information useful, and would like to see it for other neighborhoods, let me know and I'd be happy to generate the data.

Oceanside's Arrowood community, including KB Homes' Windham and Buckingham tracts, is an area of homes less than 5 years old with new construction still ongoing. Unfortunately, this mix has caused it to have some of the biggest price drops (from the peak) that we have seen in Oceanside.

As the inventory of bank owned homes has dwindled, and multiple offer situations has caused many buyers to miss out, the new home builders (KB, Richmond American, Fieldstone, and John Laing) have been very aggressive in both their pricing and the incentives offered which is now translating into decent sales activity.

For example, of the 15 homes currently in escrow, 4 are bank owned, 1 is a short sale, 1 is a non-distressed seller, and 9 are new homes. Of homes sold in the past 3 months, 8 were bank owned, 3 short sales, 2 non-distressed, and 4 were new homes.

And to see how skewed those numbers are, of the 36 Active listings, 6 are bank owned, 17 are short sales, 9 are non-distressed, and 4 are new homes.

It's areas like this in San Diego County which will still see some price drop through 2008. Other neighborhoods are faring better and should see prices now levelling since inventory is much less than it was 6 months ago. Just remember, having an experienced, knowledgeable, local real estate agent can help buyers figure out what neighborhoods make the most sense, and how to negotiate best with REOs, short sales, or new homes.

Just this week, a 1919sf home built in 1996 priced at $343,900 in Oceanside's Rancho Del Oro community received 30 offers. The market price of this bank owned home is about $375,000. So the asking price represents a pretty good deal at today's pricing, but otherwise it is an unremarkable home and actually backs up to a fairly busy street.

It's encouraging to know there are that many serious buyers in Rancho Del Oro since it indicates a much healthier market than we have seen the past 6-9 months. And this is not the only home seeing multiple offers, as well priced homes which have come on the market in the past month or two are quite often getting 2 or 3 offers.

Does this mean the bottom has hit for pricing in Oceanside? Only time will tell, but you can be sure when today's pending sales finally close, we will at least see a levelling off of the downward price decline that has been so prevalent since summer 2007.

Buyers may want to take stock since with the current pricing and interest rate levels, it may not get much better than this.

Many parts of Oceanside have seen prices almost freefall since last summer. Fortunately, due to recent buyer activity, that decline has a chance to slow down and maybe even level off.

With 53 homes actively for sale in Rancho Del Oro, and 14 in Pending status, it indicates a theoretical 4 month inventory. For the latter half of 2007, that was typically 6-9 months.

Another indicator is the number of multiple offers that are occurring, particularily in the sub-$500,000 price range. While a number of the offers are still considered low-balls, it appears there is enough competition that sellers can start to get closer to asking prices. Plus many of the bank-owned homes are getting so much interest, that buyers and their agents are pursuing short sales. Banks seemed to have learned their lesson from 2007 so that short sales are not quite as painful and have a higher chance of success than we saw last year.

Does this mean we have seen the bottom in prices? Probably not as some of this activity is seasonal and there are still a lot of foreclosed properties yet to hit the market. But let's keep our fingers crossed. With the government taking action to help the housing market, 2009 holds promise for recovery.