This monthly Real Estate Market Report describes the real estate market conditions in Coastal North County San Diego, and how they have changed over the past month and year.
2018 Tax Code Changes
I am receiving many questions about tax code changes and homeownership. Please check with your tax advisor to determine how the 2018 tax code will affect you. Here are some of the big changes:
- Mortgage Interest Deduction for 1st and 2nd homes – now capped at $750,000 of debt.
- Home Equity Line of Credit (HELOC) – all deductible interest must be for proceeds used to improve the property.
- State property, income, and sales tax capped at $10,000 maximum deduction. This applies to both married couples and single filers.
- Capital gains exclusion does not change – still $250,000 for singles, $500,000 for married couples, and must live in property for 2 of the last 5 years.
What’s Happening in the North County San Diego Real Estate Market?
With inventory so low lately, I am grateful that there are more homes for sale than one month ago.
In Carlsbad, inventory for detached homes has increased by 18%, and inventory for attached homes has increased by 37% from one month ago. The January median sales price for detached homes increased slightly, from $915,000 in December to $957,500 in January. For January sales, most homes in Carlsbad were sold within 2 weeks.
In Encinitas, inventory for detached homes didn’t change, but the number of attached homes for sale doubled, from 8 to 16. The median sales price for detached homes increased slightly from $1,172,500 in December to $1,185,000 in January. The sales price for attached homes increased by almost 10%, from $560,000 in December to $614,500 in January. The median number of days on market increased significantly to 41 days for detached homes, and 42 days for attached homes.
In San Marcos, inventory for detached homes has increased by 15% from one month ago. The January median sales price for detached homes increased 3% from December, from $636,000 to $655,000. For attached homes, the sales price decreased by over 7%, from $449,900 in December to $416,000 in January. Most homes sold within two weeks. The number of days on market for detached homes increased by 12 in December, to 22 in January.
In Vista, inventory for detached homes increased by 10%, and inventory for attached homes increased by 33%, from one month ago. The median sales price for detached homes decreased 6% from November, from $572,500 to $537,500. The median sales price for attached homes increased by 11%, from $345,000 to $385,000. The number of Days on Market increased for Vista sales: in December, most homes sold within four weeks.
Consult the Real Estate Market Report for Your Area
My Real Estate Market Report covers the areas of Carlsbad, Encinitas/Leucadia/Cardiff-by-the-Sea, San Marcos, and Vista.
2018 Mortgage Limits
The mortgage limit for conventional, VA, and FHA loans in San Diego County is $649,750. The conforming loan limit is $453,100. Loans at or below this amount usually offer the lowest interest rates.
Loans between $453,100 and $649,750 are called super conforming, or high balance loans. Any loans above $649,750 are jumbo loans.
Interest rates have recently increased. Fixed mortgage rates for 30-year terms hover around 4.5% for conventional loans. VA and FHA loans have enjoyed lower rates, closer to 4%.
Loan Program Update
FHA Loan Programs offer mortgages with only 3 1/2% down payment. VA Loan Programs offer $0 down payment mortgages to eligible military active duty and veterans, with no monthly mortgage insurance. Conventional loans are available starting at only 3% down payment, and some of these conventional loans are available with no monthly mortgage insurance.
All of these loan programs can be used for new purchases, or for refinancing existing mortgages.
Have you had a bankruptcy, short sale, or foreclosure? Find out how long you need to wait to buy again, which depend on the event and the type of loan you want to obtain.
Solar Rebates – 30% Federal Tax Credit Available through 2019
THERE’S STILL TIME TO BUY SOLAR! Federal tax code allows for a one-time 30% Residential Energy Credit to purchase home solar photovoltaic systems. The credit may include any repairs necessary to install the panels, including roofing repairs. Check with your tax professional. This 30% incentive will be available through December 31, 2019, before tapering to 10% in 2022. Read my Solar for Homeowners article series.
Tree Trimming Season is Back
It’s time to schedule your tree pruning! Hurry before nesting season begins. Read more about when to prune your trees.
Cooler Weather = Time to Switch to Waterwise Landscaping
You can get paid to switch our your turf for more sustainable landscaping. Read my article about rebates for turfgrass removal. If you want to learn more about water-wise landscaping, the Metropolitan Water District of Southern California offers free California Friendly Landscape classes online. The San Diego County Water Authority also offers free California Friendly Landscape Training classes throughout San Diego County.
Down Payment Assistance
Low- to median-income borrowers may qualify for down payment assistance. Some programs can be layered on top of each other, to maximize your benefit.
Use the California Association of REALTORS® Down Payment Resource Tool to check all available programs. Here are links to my articles about some popular down payment programs:
- CalHFA Down Payment Assistance – deferred loans for first-time home buyers (haven’t owned a home in 3 years) – new updates for 2018!
- San Diego Housing Commission – deferred loans and grants
- Fannie Mae HomePath Ready Buyer Program – grants up to 3% for Fannie Mae owned homes
- Golden State Finance Authority – grants up to 5% for down payment and closing costs
Selling Your Home
Are you curious about how much your home is worth? The Real Estate Market Report is a good start, but if you’re interested in the market value a particular property or area, contact me for a specific market analysis. In addition to my Real Estate Market Report, I also provide information about seller closing costs, to give you the true cost of selling a home.
You can also use my Seller Net Proceeds Worksheet, to estimate your bottom line. You can also read about the seller disclosure process. If you need to sell one home to buy another, here’s how to sell and buy a home at the same time.
If you’re a real estate investor and want to defer paying capital gains taxes by exchanging one property for another, then read my article about 1031 Exchanges.
Buying a Home
If you’re thinking of buying a home, use my Cost to Buy a House Worksheet and my Monthly Housing Costs Worksheet, to help you budget and plan for the future. You can also estimate your Mortgage Approval Amount. Learn more about the Cost to Buy a House and the Cost to Own a Home. If you are a cash buyer, read about Closing Costs for Cash Buyers.
If you’re interested in buying a fixer property and hiring contractors to make repairs and renovations, you should consider a Renovation Loan. Renovation loans finance both the property and the renovations, in one single mortgage payment. Renovation loans can be used to finance energy upgrades, like insulation, solar panels, and electric heat pump water heaters. Before you invest in energy efficiency, read about 7 Ways to Finance Energy Upgrades.
Any questions? Send me a message.