As expected, the Coastal Commission has approved Pebble Beach Company’s revised development plan, most recently rejected in 2007. The plan is a departure from the original intent years ago to build another golf course. The approved plan includes the construction of 90 new homes. News Coverage of the approval.  The Staff Report that was the basis for the vote runs 195 pages.

US News released their ranking of public school across the nation today. Carmel High School ranked fairly high in the standings based on test scores, availability of Advance Placement classes, student teacher ratios and other metrics.

The high quality of the Carmel School district schools (three elementary, one middle school and the high school) has a material impact on home values within the district as families rent or buy to send their children to the schools. I am a father of two Carmel school district students (one in elementary and the other at the middle school) and like many parents am involved in the school and the ancillary services and activities the district provides to the students.

You can read about the study on the US News website of school rankings.

Carmel sizzled last week….at least in the real estate market, if not in the temperature.  Eight properties went into escrow including 3 properties that had been lingering on the market over a year and a bungalow in the Carmel Point area that went into escrow quickly with a list price of $989K; others were in the $1.5M – $749K range.  Five properties closed escrow including an ocean view 1930′s restored Carmel Point classic residence with guest house that sold at $2.5M and 3 other smaller properties in outlying areas that sold for $718K to $393K for an REO across the Highway.  A lovely ocean view Mediterranean in the Carmel Highlands closed at $2.9M.   All of the four new listings that entered the market this past week were outside the Golden Rectangle or Point areas and they ranged from $1.49M to $699K.  Overall, another upbeat week for the market in Carmel as inventory, at least in the <$4M price range, had a net decline.

Pebble Beach also continued the positive trend, including in the over $4M price range with a $5.2M property on Old 17 Mile Dr. selling along with two other properties at $1.3M and a $895K bargain going into escrow as soon as it came on the market.  Three properties closed escrow at $1.39M, $699K and $575K (the last two being short sales).  With only two new listings coming on the market in Pebble Beach this week at $3.29M and $1.3M, a net decline in inventory was also seen here. An annual influx of potential buyers descend on our area for the spring Easter holidays so expect more good news in the weeks to come.

Surely you know that the Pebble Beach Food & Wine is this coming week, April 12-15th but there is another very interesting event coming up this week in Carmel on Tuesday, April 10th.  That is the day that Carmel elects a new mayor and the community will be having a gathering at the Sunset Center after the polls close at 8:30PM….for both candidates!  Now isn’t that civilized?  Perhaps our national pols should take note…..

-Pat

The “Valley” is the most geographically diverse of our real estate markets with lots ranging from a few thousand feet in the neighborhoods located close to the mouth of the valley and near Carmel Valley village, to large equestrian properties and vineyards of tens to hundreds of acres.  Within Carmel Valley are there are several developments including the Santa Lucia Preserve, Tehama, and Carmel Valley Ranch. Each of these developments has distinctive qualities and unique market characteristics that impact the broader Carmel Valley numbers.

Carmel Valley Inventory and Average Sale Price

Total inventory in Carmel Valley declined through the latter half of 2011. First quarter inventory of 264 homes compares favorably with 336 homes on the market during the first quarter of 2011. Average days on market also fell from 231 days in the first quarter of last year to 173 days in the first quarter of this year.

Average Sale price climbed in November and December of 2011, held relatively steady in December and January, and has declined in March. The first quarter of 2011 saw an average sale price in the Valley of $830,878 while this year the first quarter average was $722,100. It is important to keep in mind that with the wide range of property values in the Valley the addition or subtraction of one or two high priced properties can have a big effect on overall market statistics.

Given the range of property and home sizes in Carmel Valley, it is helpful to divide the market into equal fourths or quartiles.

The table demonstrates the range of the Carmel Valley market. The median price of homes in the top 25% of the market is six times the median price of homes in the lowest 25%. The most expensive homes are also three times as large as the least expensive. It is interesting to note that the fastest moving quartile of homes is the third quartile. These homes are closing in an average of 130 days on market versus the less expensive quartile at 182 and the most expensive quartile at 308 days.

With a median price of $699,000 the third quartile is positioned to take advantage of the historically low interest rates and the higher than national average FHA loan amount of $729,750.

Monterey was the Spanish and then Mexican capital of “Alta California” from 1777 to 1846 before California was claimed by the United States, in a ceremony at the Monterey Customs House. Monterey was home to the first newspaper in the state, first theater, first public library, and first public school and is the current home to the Monterey Bay Aquarium, Cannery Row, Fisherman’s wharf, The Monterey Institute of International Studies, Naval Post Graduate School, The Defense Language Institute, award winning restaurants,  scuba diving, surfing, sailing, first class shopping and wonderful neighborhoods.

The residential real estate market in Monterey, like all Peninsula markets, is well off the highs seen in 2006 and 2007. Beginning in the summer of 2011, a drop in available inventory and increase in buyer interest led to a relatively flat median price curve in late 2011 and early 2012. In fact, the first months of 2012 have seen an uptick in median pricing partly driven by the seasonal fall off in available inventory along with a growing sense that the market may have reached a pricing equilibrium. Current inventory is approximately 60 homes whereas a year ago Monterey had about 100 homes on the market.

The average number of days on market for homes currently listed in Monterey is about 127 days with 40% of the homes currently listed having undergone at least one price reduction during their time on the market.  In February of this year the sale price to list price ratio was 98.2% meaning that sellers were receiving on average of 98% of their final list price. That is, the list price at the time the property was sold, which in 40% of the cases was lower than the original list price. Effective pricing remains critically important for sellers as they work to attract buyers.

The overall Days on Market for Monterey is in the neighborhood of 127 days; it is the $300,000 to $600,000 priced homes that are seeing the quickest time to sale. In contrast, homes listed between $1,400,000 and $1,600,000 took an average of 422 days to sell over the last 12 months. This makes sense given the historically low interest rates and the higher FHA limit for Monterey County of $729,750 (while other counties have limits in the 300,000 and 400,000 dollar range.)

Monterey has always been a wonderful place to live, and has again become affordable for many buyers who were priced out of the Monterey Peninsula in the past.  As lending becomes more rational and interest rates remain low, people are returning to Monterey not only to enjoy the quality of life on vacation, but to become homeowners as well.

The real estate activity pendulum swung the other way this week with Carmel blazing back to life.  Eight properties closed escrow in Carmel while 5 went into escrow.  The closings included a $4.1M sale on San Antonio at the edge of the Golden Rectangle while the rest were in the $1.2M-$500K range with one $825K short sale and a few cottages that went into escrow quickly.  The new sales were all in that very active $1M-$700K price range.  The 5 new entries to the market included a $3M Carmel Point area remodel, a large $2.9M Camino Real house north of Ocean Avenue and 3 smaller cottages at $1M-$785K in other areas of town.  A $3.9M oceanfront property came on the market at Otter Covein the Carmel Highlands; quite a value for oceanfront.  Total inventory in Carmel has dropped 20% since the beginning of February and is at the lowest point since July 2011.

Pebble Beach had more activity this week in the lower price ranges with 3 closings at $1.6M (bank-owned), $760K and $640K and only one new sale at $1.3M. The only new listing was on Sand Dune Road at $5.2M, a property that has been on and off the market for some time.   March was the best month for real estate activity in Pebble Beach for more than 5 years if one compares active listings (83) to sold listings (14) although much of this activity was in a lower price range than in the past.  That all may change soon as this part of the market works through its inventory and buyers are forced to up their offers in order to enter the Pebble Beach market.

April 3rd is the birthday of one of Carmel’s most beloved citizens…Doris Day.  The Cypress Inn, which she owns with Denny Levett, will be hosting a birthday tribute concert that day at 5:30PM and 8PM with vocalist Laura Didier and pianist Jim Martinez playing some of the tunes that made Doris a star. And don’t forget to bring your pooch as the Cypress is know for their dog-friendly Yappy Hour. The Cypress Inn is on the northeast corner of Lincoln and 7th.  But you knew that, didn’t you???

-Pat

________

CALIFORNIA, Florida & Arizona Top States for International Buyers

Of the $107 trillion dollars in homes sales for the year ending in March 2011, $41 billion dollars of that was purchased by international buyers. Data compiled by the National Association of Realtors shows the transactions came from over 70 countries, with the top five purchasers being Canada, China, Mexico, United Kingdom and India. With 23% of this $41 billion, Canada is tops the list of international Buyers.  Canadians have increased their purchasing by 12% from just 4 years earlier.

The average price per international buyer transaction is $315,000, higher than the US based buyer at $218k. According to the NAR data, only 5% of the sales were above $1 million, a statistic I was surprised to learn, as I thought that percentage would be higher.

Where are they buying? Not all U.S. markets are universally appealing to out-of-country investors.  International home buying activity is largely concentrated in a few areas of the country. Using public record data compiled by San Diego-based real estate data analysis firm DataQuick, the most popular areas in the U.S. for foreign home buyers are California (12%), Florida, Arizona and Texas.  These four states accounted for 58% of the international transactions.   Of the top ten areas, Florida accounts for six of them.

Since non-resident foreigners are limited to a 6 month stay, the main use/purpose for these homes are for vacation, according to the National Association of Realtors research. For example, Canadians are using the homes in Florida for a break from the winter weather. In addition, it is noted, a good percentage of the international transactions are in cities/towns that have colleges or universities. The student then uses the home while studying abroad. Lastly, foreign investors see the United States real estate both a safe and profitable investment and are picking up properties to be solely income producing.

For our local real estate market, we do see a good amount of international buyer interest. From my experience, the current interest has come mostly from China, as well as Mexico and India. Currently Carmel Realty Company has on hand translators for Chinese and Russian clients, supporting this international buying trend.

Pebble Beach is dominating the luxury market lately and that is quite a change from last year when Carmel drove the high end while Pebble Beach stalled.  Four properties closed escrow in Pebble this past week, including an off-market property close to the Lodge that sold for $3.35M after having sold (also off-market) 9 months ago at $3M.  Two other closings came in at $2M each and one lonely <$1M listing closed. CRC brought on a spectacular 17 Mile Drive  contemporary right on the famed 14th hole of Pebble at $27M…truly a show-stopper.  And a Residence above the Lodge came on at $7M, a Stocker/Allaire remodel.

Carmel was surprisingly only active below $1M this past week with 4 properties under that threshold going into escrow and 2 closing; 3 of these new sales were bank-owned and went into escrow as soon as they hit the market.  So it appears that this distressed inventory is clearing out rapidly.  Three new listings came on at $1.5M, $799K and $599K, none distress sales.

The Carmel Highlands saw another Spindrift Rd. property close: two adjacent oceanfront properties fixers closed as one parcel at $6.7M.  Two other oceanfront homes came on the market in the Highlands at $6.6M and $3.59M, both on Yankee Point Drive.  There is quite a bit of oceanfront inventory in the Highlands which tends to lag Carmel in sales so prices will likely not stabilize in this area for some time.

You might want to warm-up for the Pebble Beach Food and Wine by attending a benefit at Tehama Golf Club for Freedom Fields USA on March 31st.  Call 888-299-8347 for tickets, $175.  Good food and good cause.

- Pat

Momentum of new sales in Carmel was sustained this past week with a $3.9M property north of Ocean Ave. going into escrow and 5 other homes in the <$1.5M range also selling; this very active segment of the market is still the most competitive one.  Four of these 6 new sales had ocean views, as always, a key driver in Carmel and Pebble Beach.  Two properties closed escrow at $525K and $480K as buyers snap these bargains up as soon as they appear on the market. On the higher end, a beautiful, ocean view Tuscan-style villa in the Carmel Highlands closed at $3.1M.  New listings included a spec house north of Ocean Ave. at $3.69M and  3 other new listings in the <$1M range. With so much activity in the lower end, prices are clearly on their way to stabilizing and then moving up again.

Pebble Beach also had a successful week, including in the higher range with 5 new sales at $5.5M, $4.49M (an anomaly – a short sale on 17 Mile Drive), $2.25M, $695K and $598K. With only 2 new listings coming on the market in Pebble at $1.2M and $1.3M, it was nice to see inventory in the $2M+ range drop and start to see some of this inventory move, again step one in seeing prices start to rise. There are still some deals to be had in Pebble Beach, especially in the higher ranges including a true estate by Cypress Point with its own 18 hole “mini” golf course, almost 10K sq. ft. of living space, 3 acres, swimming pool, and on and on; $5.2M is actually indeed a bargain for this special estate.

It seems like every restaurant in town will be going “green” this weekend….at least for St. Patrick’s Day.   Brophy’s Tavern on San Carlos and 4th sounds like cozy pub to enjoy the festivities Saturday night. Or you could go out Friday night for St Practice Day!

- Pat