Is the San Diego housing market recovering? That is the $64,000 question. There is evidence that we have hit the bottom of the market and are beginning to stabilize. In July, housing sales increased by 3.8% nationwide and in California that figure was 4.6%. These are the highest increases in 6 years. San Diego homes had an 11% in sales price year-over-year in August.
The number of foreclosure filings in California dropped 32.3% from August, 2011 to August, 2012. This means home owners are finding more ways to hold their homes and the drag that foreclosed homes have on home prices is reducing. There are only 217 foreclosed San Diego homes for sale in the entire county. Further, there are only 470 available San Diego County homes in various stages of short sale.
San Diego homes continue to be hot with just about any home priced under $700,000 receiving multiple offers. The unfortunate side effect of multiple offers is that it is taking San Diego home buyers longer to find a new home. It also means San Diego home buyers must exercise more patience when shopping for a new home. The reduction in available San Diego homes translates into longer searches and more offers to get a home.
The San Diego home market is also receiving a boost from some stabilization in the job market. Pacific San Diego Magazine reports that most San Diego employers are no longer shedding jobs. There has also been an increase in available jobs in the region. It is expected that job growth will increase slowly through 2014 at which time employment levels are expected to match prerecession levels.
Fed Chairman Paul Bernanke recently announced the implementation of QE3 in which the Fed will purchase $40 billion of mortgaged backed securities each month until there is a substantial improvement in the job market. This action should keep mortgage interest rates low for the forseeable future allowing buyers to continue to afford San Diego homes. It is expected however that lenders will continue to impose very strict mortgage standards on borrowers allowing only those with substantial down payments and stellar credit to qualify for a home mortgage.
So what is the bottom line? Is the San Diego home market recovering? I give it a yes. With more buyers looking for homes and sellers feeling a bit better about their financial situation, the market should continue to stabilize and the next step after stabilization is recovery.
If you have questions about the San Diego home market please feel free to ask. If you are thinking about buying or selling a San Diego home, I would be honored to help you. Just drop me a line.