San Diego Housing Market Update August 2012

Home sales continue to remain strong and fiercely competitive as inventory remains low and buyer demand high in San Diego’s real estate market.

Compared to June 2012, July sales for single family homes were down 5.7%.  Condo’s were also down 5.1% compared to June according to the San Diego Association of Realtors.  The main reason for the decrease in sales is the limited number of properties for sale; the quickly becoming “old” inventory crisis I’ve been talking about for most of the selling season. 

Interestingly, but not surprisingly, prices increased in July.  Comparing pricing from June 2012 to July 2012 single family homes were up 1.3% and condo’s rose dramatically to 4.4%.  This increase in pricing is following a several month trend of slowly rising prices in San Diego’s real estate market.  If the inventory is low and the demand high, which it has been in San Diego since March, prices will rise. 

Comparing year to year price trends in San Diego, July 2012 to June 2011 saw an increase of 5.3% for single family homes in July 2012 and condo’s rose a dramatic 14.5%.  The average median sales price for a single family home in San Diego was $392,380 for July 2012.  In July of 2011 it was $375,330…quite the increase!

The California Association of Realtors (C.A.R.) also released a report last week which further addresses the inventory crisis we are experiencing in California’s real estate market.  C.A.R. found that the number of people that can qualify for a loan on a median priced home dropped to 51% in the second quarter of this year.  The first quarter hosted a heavier number of 56%. 

Also from a statewide perspective, C.A.R. found real estate sales posted strong gains statewide with the sale prices showing a positive year-over-year increase for the fourth straight month in a row and the median price approaching a “near-four-year-high”.  This is none-the-less, very encouraging news.

Part of the demand for housing is being driven by historically low interest rates.  July, for example, saw an average for a 30-year fixed mortgage interest rate of 3.55 %.  This was actually a drop from 3.68 % in July and 4.55 % in July of 2011. 

If you are thinking of buying or selling your home, there truly has not been a better time in years to do so.  Pent up demand from buyers is driving pricing upwards.  Low interest rates can make owning a home more affordable than renting in many cases.  One thing is for certain, preparation and education is key, no matter what side of the fence you are on.  Start early, and take advantage of our very dynamic real estate market in San Diego!

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