The numbers are out for the real estate market for the month of February, and it appears that the sale of new single family homes fell, but the prices of homes went up. A recent article on CNBC has the figures, to read the full article click on the link. A few numbers stood out for me as a REALTOR in San Diego.
“The Commerce Department said on Friday sales slipped 1.6 percent to a seasonally adjusted 313,000-unit annual rate. January’s sales pace was revised down to 318,000 units from the previously reported 321,000 units.
Sales for November and December were revised up a bit.
Economists polled by Reuters had forecast sales at a 325,000-unit rate in February. Compared to February last year, new home sales were up 11.4 percent.
The median price for a new home rose 8.3 percent to $233,700, the highest level since June. Compared to February last year, the median price was up 6.2 percent.”
A duplex in Mission Hills, San Diego for sale for a little over $525 000
These numbers are across the nation, for the San Diego real estate market I would agree the number of sales have dropped. The reason for sales dropping in the San Diego real estate market from what I observe is the lack of inventory. I work with a number of buyers in a few different price points, and right now we are really not seeing a huge amount of inventory to work with. All my buyers are new home buyers and investors so they are waiting for the right deal, but they are not it any rush. I was with a fellow REALTOR last week and we both commented we have great pipelines of buyers, just a lack of inventory. So seeing this article say sales were down makes sense to me, but not because of any reason other than lack of inventory.
I know there is a huge inventory of homes that are sitting on the foreclosure list, the reason I know this I worked with a company that was putting door hangers on homes that were in foreclosure. One day we decided to go knock on some of their doors, to our surprise almost 80% were empty and abandoned. So think about that for a moment, the bank has homes in their inventory right now, where they are uninhabited, yet they are not available for sale. The banks really need to talk to their third party inspectors, find out which homes are vacant, and put these homes on the market. The banks are assuming that people are living in these homes, the reality is many of them have already moved out of state, or elsewhere and the home is empty. You cannot help these people by delaying the foreclosure process, they are gone already. Putting these homes up on the market would pick up the sales figure and we can get more new home owners in the system.
The other part of the story from CNBC was the increase in price, I got to say as REALTOR in San Diego that probably sees about 25 homes a week, I have yet to see the price go up on a home that I have on my prospects lists. That list by the way is over 300 homes in San Diego, I see plenty of price reductions, and expired listings, but no price increases. My lowest buyer is for $400k, and my highest is at $1.6 million, so not to see any price increases is a pretty large spectrum. That being said, a friend of mine listed their home in Encinitas for sale, and will end up selling it for more than they asked for it. The reason is they got multiple offers from committed buyers who wanted their home. So if that qualifies as an increase in price than I can see in those situations the numbers being swayed. I have yet to offer more for a home for any of my buyers, and on average the offer I get accepted is about 5 to 10% below asking price.
I can only hope the banks pull their act together, and see who needs help in their homes, and who has abandoned their home. Put those homes back on the market, and with the current pool of real estate buyers the homes will move quickly. If you are thinking about buying a home in San Diego to live in, or for investment purposes I would love to help you. Downtown San Diego has 206 condo’s for sale right now from as low as $180 000 for a 1 bedroom, 1 bathroom. For around $380 000, you can get fully upgraded 3 bedroom home in the Clairemont area of San Diego. If you have cash you can move on some great real estate deals very quickly, with financing it’s a little tougher if you are looking for a condo due to HOA issues, buying a home is easier with a loan right now. You can call me at 858-314-8145 or fill out the contact form on the top right side of the screen.
There is no doubt if you have the financial ability to buy a home, it’s better to own then to rent in this low price real estate market. The potential to make money while you live in your home at today’s prices is pretty close to slam dunk even if the market at some points goes back to 70% of what it was. Case in point I just sold a condo out by San Diego State that at the height of the market was worth almost $300 000, the new buyer picked it up for $110 000, for this 2 bedroom, 2 bathroom condo. If it goes back to $200 000, the buyer will make $90 000 on their investment. Think about it, let’s talk, I can show you other examples just like this, where the chance to almost double your money on your real estate investment is very possible.
Thanks for taking the time to read my opinion on the Real Estate market in San Diego, real estate is very much a referral driven business. If you know of anyone that is looking for a home I would love the referral, and I look forward to helping many more buyers get homes in sunny San Diego.
