Spring may have sprung, but has Rancho real estate caught up? With interest rates teetering somewhere between 6.5% and 6.9%, buyers only have a slight advantage in the negotiating process. The median list price (not closing price) in 067 has risen to $7,995,000 over last year’s $7,800,000. With the median days on the market being 91 and the average days on the market being a shocking 236, it’s safe to say that Rancho Santa Fe real estate is all over the map.
Of teardowns and sitting “flips”
When we break down these numbers, we need to consider more than just the price per square foot ($1,004) and days on the market. Today, sellers must understand that their 1930s build might fetch a different price tag than a new spec. Furthermore, numerous renovations or “flips” are currently sitting on the market, indicating that Rancho buyers are really looking for something new. Not many buyers want to buy a 60+-year-old teardown and do the work themselves; they also don’t want a Home Depot reno, which so many “flips” are. While 31% of listings are taking price reductions, developers are shining and fetching list prices for their stylish new pads.
However, new comes at a price, a $23 million dollar price to be exact, like one just sold on Linea Del Cielo. Did someone say Office Max? Oh, sorry, it’s a show pony home. Wonder how that one slipped through the hands of the ever-so-strict Art Jury?! The Association’s mission states,
“New projects maintain the “high artistic result” described in the Rancho Santa Fe Protective Covenant.” Please explain to me how a 12,800 square foot “home” with a moat engulfing the backyard keeps with the classic Spanish architectural style of RSF.
No time nor money
Don’t get me wrong, I am all for new and modern. I think RSF could benefit from a little rule-bending as long as everyone can benefit. It might even encourage our own local buyers to pick up the old dog of a house and breathe a bit of new life into it. Unfortunately, most buyers do not have the time nor money, unlike the snazzy developers with the Ranch’s oldest agents in their back pockets.
There is plenty of talk of a bubble about to burst; if so, when and why? (TBD on this part) Compass, the agency for whom I work and which is ranked as the No. 1 brokerage in San Diego, sees no indications of a blowout this year. In fact, my agency predicts the San Diego market and Rancho Santa Fe will be stronger than ever. It will be fascinating indeed to see how 2024 turns out for us here. Remember the good old days in RSF when you could get a 4,000 sq. ft. family home for $2.5 million? Le sigh. Sadly, no matter how big the bubble, I don’t see us ever going back to those halcyon house prices.
Christian Potter is a Ranch native and realtor at Compass Real Estate in Rancho Santa Fe.