San Diego Real Estate Market Recap for 2012

As we said goodbye to 2012, we also look at the positive occurrences in the real estate market in the area. San Diego saw home values increase, competition rose, and prospects for a steady recovery was seen for 2013. A look will show the main developments that helped the real estate market in 2012 and what we can expect to see in 2013.

Increase in Home Prices

During the off-season home prices in the San Diego rose. In November of 2012, the median home price was $358,000, which was a huge 14% increase when compared to the same time period in 2011.

Decrease in Inventory

The smaller amount of homes on the market may discourage potential homebuyers but is it great news for home sellers. In addition, it often helps raise the price of homes. Right now there are only 5,300 active listings which is about half of what was seen last year at the same time. This makes competition for buying a home strong. For anyone waiting to see if home prices are going to rise even more now may be the best time to list their home while the inventory is low and interest rates are low.

Shorts Sales more than Foreclosures

Finally, after years of most homes on the market being in some stage of foreclosure, there was a drop in homes that were underwater in 2012. Short sales which are homes in which the owners may sell for less that what they owe on the home are being seen more than foreclosures. This change shows a slow improvement in the economy and allows lenders and homeowners more benefits.

Banks Coming to the Aid

California Attorney General Kamala Harris won a $25 billion mortgage settlement to hold banks accountable for any unfair foreclosures. Critics believe the deal is not sufficient with all the recession losses. However, it does offer more bank sponsored aid to consumers than in the last few years, which helps to stop the trend toward foreclosure and start the slow trend to repair the market.

Mortgage Rates Decreased

In 2012, mortgage rated dropped quite a bit as reported by Freddie Mac while current mortgage interest rates are now below 4 percent. This mortgage rank is historically low and is a good sign for buyers that have good credit. The Federal Reserve plan to keep the rates down to help individuals buy homes and refinance mortgages.

Looking Forward

All of the above developments will still be a moving factor for the real estate market in the San Diego area in 2013. For information on selling your home or finding a home in the San Diego area, contact one of our Realtors today by calling 888-865-5055.

Luxury Home Values Going Up

In California, the value of luxury homes is on the way up. The prices are climbing in San Francisco, Los Angeles and San Diego.

During the 3rd quarter of 2012 when compared to last year, the prices of luxury homes in the major metropolitan markets in California rose.

The Index shows that in the San Francisco Bay Area home values rose 8.1 percent from the figure seen in 2011 and was a 2.4 percent over the second quarter of 2012. The average price in San Francisco is $2.73 million.

In the Los Angeles area, home values rose 1 percent from the third quarter of 2011 and declined a small 0.8% from the second quarter of 2012. The average price of a luxury home in Los Angeles is $2.02 million.

In the San Diego area, home values rose 2.2 percent year-over-year and increased 0.8 percent from the second quarter of 2012. The average luxury home price in San Diego is $1.66 million.

"Luxury home prices were particularly strong in the San Francisco Bay Area during the third quarter of 2012," President and Chief Operating Officer of First Republic Bank, Katherine August-deWilde stated and went on to say, "The Bay Area economy is healthy, inventory is limited, and multiple offers are increasingly the norm. Values in Los Angeles and San Diego are rising, and some neighborhoods are experiencing strong demand. Historic low interest rates have resulted in an elevated level of activity in luxury markets throughout California."

San Diego Area Home Values

San Diego luxury homes values is the growing trend with a higher value than what was seen a year ago. Prices in the area have increased for the last three quarters on a year over year basis, which includes a 2.2 percent gain during the third quarter when compared to last year.

Michael Taylor of California Prudential Realty in Rancho Santa Fe explained, for properties over $3 million, sales activity is picking up. "We have had a higher number of units sold this year than last year for homes over $3 million," and went on to say, "To me, that indicates fear has been wrung out of the market. People are now willing to spend more to buy a home, and they’re getting significantly more home because of the recent price declines. The perception is that we are at the bottom of this market."

Farid Khayamian of Bluxen Real Estate in La Jolla stated, "There are a lot of people who want to buy," and went on to explain, "We see multiple offers everywhere, particularly when the property is priced right. A year ago, there was more inventory due to short sales and foreclosures, but that has dried up. Right now, you have to buy at the asking price. In January, we will have more inventory and possibly lower prices."

San Francisco Bay Home Values

The San Francisco Bay Area reported its second consecutive quarter of gains on a year-over-year basis. The 8.1 percent year-over-year rise in the third quarter of 2012 was the highest since the first quarter of 2006.

Malcolm Kaufman of McGuire Real Estate in San Francisco stated, "Prices for luxury homes have been strong all year," and went on to say, "There is limited inventory, the economy here has returned better than anywhere in the country, and employment is up. Lots of money is being spent on $5 million homes and $10 million homes. For some, it feels like 2005 again."

In Silicon Valley, Pat Kalish of Intero Real Estate Services in Menlo Park stated, "People have secure jobs and stable incomes," and went on to say, "Except for the highest end of the luxury market, there is strong competition for properties. We have scarcity of homes, historic low interest and an optimistic outlook. When you are out in the market, you feel the optimism."

In the Marin County, Pat Montag of Decker Bullock Sotheby’s International Realty in Mill Valley said, "Marin has not seen the increases that have happened in Menlo Park or San Francisco," and went on to say, "We typically lag a quarter behind San Francisco. We did see an uptick at the end of third quarter in the $3 million to $5 million range. Many people are still waiting until they see what happens in Washington D.C. in the first quarter."

Los Angeles Area Home Values

In the Los Angeles area home value rose 1 percent from last year but did drop just a bit from the second quarter

Dan Weiser of Coldwell Banker Beverly Hills South stated, "On the west side of Los Angeles, inventory is scarce and demand is high. We’re back to 2007 sales volume. Prices are probably within 10% of the height of the market. Sellers are getting incredible prices for properties in the highest end of the luxury market."

Michele Hall of Coldwell Banker in Brentwood explained, "New construction is flying off the shelf, with all cash and multiple offers. We’re seeing multiple offers in every price range, and there are fewer foreclosures and short sales. Inventory opened up, but was then snapped up."

In Santa Barbara, Joanne Schoenfeld of Santa Barbara Living Real Estate Brokerage explained, "The luxury market is very strong in Santa Barbara and Montecito," and went on to say, "There is a lot more activity and closed sales than last year. Prices continue to rise slightly, and I don’t see them going down any time soon. It’s a good, strong market."

San Diego Leading Real Estate Recovery

The coastal homes in San Diego are leading the real estate recovery. As reported by CBS News homes along the coast in San Diego are the major force behind the real estate prices found in the state.

The median price of a home in California increased to close to $250,000 in the spring of 2012. Along with this, the median Southern California home price rose to $290,000, which is the first increase seen in the area since December of 2010. Along with Orange, Ventura, and Los Angeles counties, San Diego saw the biggest boost in home prices. The coastal counties were 71.5 percent of the local sales in April of 2012 which is mainly due to the improvement in the luxury market.

As reported by the First Republic Prestige Home Index the home values in the San Diego area rose 0.4 percent from the 4th quarter, which put the average luxury home price around $1.65 million. Predictions by industry professionals is that the prices of high end homes will continue to rise throughout the San Diego area, however, this is only for the time being as inventory is still higher than demand. What this means to those looking to buy in southern California, is that now is the time to buy as the prices will begin to increase as the inventory depletes.

Looking for that beach bungalow or mansion overlooking the ocean? Then you need an expert in San Diego real estate. Contact one of our professionals today to see the homes available in the area by calling 888-865-5055.

New Community Candera in San Marcos

On July 7th the opening of the new community of Candera in San Marcos will commence. The newly decorated model homes, great location, and affordable prices are what will bring in most homeowners.

Homebuyers will be able to enjoy chicken tacos, fish, and beverages from 11:30 to 2:30 pm by Rubio’s Taco Truck.

The models will display the two residential collections which include detached homes beginning in the $400,000 and attached town homes starting in the $300,000.

The town homes offer 4 different two story plans with between 1,524 and 2,014 square feet, and includes three to four bedrooms and two and one-half to three baths. The town homes have versatile options such as a den or loft with all homes offering a two car attached garage.

The town homes also offer gourmet kitchens with granite countertops, stainless steel Whirlpool appliances, European style termofoil cabinets, and an island for convenience. The master bedroom suites offer walk in closets, separate tub and shower, and either decks or patios with private yards.

There are 8 detached two story homes with square footage between 2,336 to 2,904 square feet, with up to five bedrooms and three baths along with a 3 car garage.

The homes boast eco friendly features that are both energy saving as well as money saving with such things as Energy Star dishwashers, radiant barrier roof sheathing, Low-E window glass, tankless water heaters, and digital set back thermostats to control both heating and air conditioning.

Within the area you will find that Candera is close by all kinds of amenities that will help your family feel comfortable and happy in their new home including shopping, fine dining on the Old California Restaurant Row, and educational opportunities at Cal State San Marcos.

TRI Pointe Homes communities are found throughout southern California with Candera being the latest and are in the process of building other communities including Sagebluff and Topazridge at Riverwalk Vista in Riverside, and Los Arboles in Simi Valley. Another community will also be debuting on July 7th, Tamarind Lane at Rosedale in Azusa. TRI Pointe is also building in northern California with the opening of Chantrea at Silver Creek in San Jose, which will be followed by Ironhorse in Morgan Hill.

To see the celebration and partake of the grand opening, you can take the 78 Freeway and exit at Twin Oaks Valley Road. From here drive north and turn right on East Mission Road. Now, go past Woodlands Parkway and turn left on Bougher Road. The Candera models are on the left.

If you are interested in these properties or want to learn more about other communities in the San Marcos area, contact 888-865-5055 today to speak with a real estate professional.

More Foreclosures on the Way

Recently, in the U-T business section, there was a featured story that stated homes sales surge and home prices rise in San Diego in April.

Just from that alone, the sign is that the housing market is now going in the right direction. However, this may not be true. The truth is there are many different stories all centered on the housing market. One day you will read foreclosures are down, the next short sales are down, and then home prices are slightly up. Everyone reads this as good news and the housing market is on the road to healing.

Before you start believing all this, you really need to learn more about the root of the problem and what it does to the housing market in San Diego. The current standings in San Diego are as follows.

As reported by zillow.com, 36% of homeowners are underwater in San Diego County.

Foreclosures are truly down in the San Diego County; however, this only means that the defaults are finally clearing out.

Wave of Foreclosures Coming

It is estimated that another wave of foreclosures is coming. These foreclosures are going to affect borrowers that took out Option-Arm and Alt-A mortgages. These loans gave home buyers low interest rates and low monthly payments. What is going to bring on more foreclosures is that the low interest rates on these loans are going to be reset this year and again in 2013. This can increase the mortgage payment around 50%. The home values are now at a 10 year low and due to the increase in the mortgage payments, many homeowners will decide on defaults or short sales as they will not be able to afford the higher payments.

It is estimated that Carmel Valley is going to be the hardest hit in the foreclosures upcoming. The main reason is that during the construction boom from 2000 to 2008, many homes were purchased with no down payment or small down payment, which means homeowners do not have a lot of equity in the home. The median income in Carmel Valley is $90,000 with higher end salary families have been able to stand firm, things are on the swing to change.

The news may not be great; however, San Diego County has a way to go before the housing market will be back on track. There are going to be more foreclosures, more short sales, more strategic defaults and possibly a flat line or decline in property values. Once all this occurs, San Diego will then begin to see some healing in the housing market. Just pay attention to the news in the housing market. If you notice several months of good news, then you can rest assured the worst is over and healing is on the way. A few good stories once in awhile are a false euphoria and may not last.

Now is the time to purchase a home in San Diego at wonderful prices. Contact one of our local Realtors today at (888) 865-5055 to find your new dream home.

Increase in San Diego Home Prices

As reported by Standard & Poor’s, through the last 12 years the value of homes in the San Diego area has appreciated around 50%.

In March, the price of a home increased by 0.4%, when compared to the month of February as reported by the Standard & Poor’s Case-Shiller Housing Price Indices released this week.

A 12-month period that ended in March of 2012 showed a decline in residential real estate prices in San Diego of 2.7% as reported by Standard & Poor, which compared the average price of a house in twenty large cities across America beginning in January of 2000 and tracking the rise and fall each year.

At this time, San Diego’s Index is at 149.68. This figure shows the value of homes in the area appreciated close to 50% in the last 12 years. This increase is in 4th position with Los Angeles, New York, and Washington DC in the upper positions.

In the 20 big markets when combined the value stayed the same from February to March but was still 2.6% lower than the levels seen in March of 2011.

David Blitzer, chairman of the Index Committee at S&P Indices stated, "While there has been improvement in some regions, housing prices have not turned." He went on to explain that the results seen in March are mixed with less markets reporting poor results, however, no signs of a large real estate recovery.

The largest annual gain in value was seen in Phoenix Arizona, which was 6.1% with the largest drop in Atlanta, Georgia with a 17.7% decline from March 201.

Rise in San Diego Home Buyers

The San Diego housing market is looking better with an increase of potential buyers, which means competition is getting tough as noted by real estate agents in the area.

Robyn Weingel stated, "It’s been a roller coaster ride. One minute, we see a house that we really like and we put an offer in, and the next thing we know we’ve got 10, 12 other people also interested in the same home, and suddenly it’s out of our reach."

Mitch and Robyn Weingel found a home in San Carlos. Robyn explained, "We feel safe here. It feels comfortable and warm; it’s pretty."

The home that wanted received 14 bids and sold for quite a bit over the asking price. The house was listed for sale at $439,000 and sold for $470,000.

Another home in Poway had over 40 offers on the table shortly after it went on the market for $255,000. The winning bid that bought the home was a little over $311,000.

Lead agent at real estate company Redfin, Sara Masey, stated, "It’s busy and competitive right now."

Masey explained to 10News that her company has under half of the inventory they had at the same last year which means buyers have fewer homes to look at which means more competition as well.

Masey stated, "It’s just a great time to buy with all the low rates, and so you have a lot of people out there trying to buy that can buy."

Mitch Weingel stated, "It is kind of a Catch-22. Interest rates are as low as they’ve ever been, but it seems like in San Diego it’s gone from a buyer’s market to a seller’s market overnight."

"It’s out there. I know that perfect house is out there for us," explained Robyn Weingel.

Home Sales up in September

In the month of September, homes sales in California were up 6.7 percent. Those looking for bargains were purchasing foreclosures while the median home price fell. In September, the median home price was $249,000.

Homebuyers were buying up foreclosures making sales go up 6.7 percent. Sales figures on the other hand, were still below average for the month of September for the Bay Area and southern California. DataQuick, a real estate information service home in San Diego revealed that home sales were lower than the figure seen in August, which is down 6.2 percent with a total of homes sold at 35,404 in September.

The median home price in September for September was $249,000, which is down 6 percent from what was seen in 2010 and the same as was seen in August of 2011. This is the 12th continuous year over year decrease in the median price. This means that many of the homes sold for half or less than what the home was worth.

DataQuick president, John Walsh stated the number of potential home buyers was growing but the demand is not seen in the numbers yet.

He stated, “Empty-nesters want something smaller, growing families want something bigger,” and went on to say, “People still die, they get married, retire — all of this generates demand. And only a fraction of that demand is being met in today’s market.”

A large amount of the homes that sold in September were foreclosures along with short sales in which the bank sold the home for less than the mortgage. The figures show that more than half of the homes that sold in California in the month of September were foreclosures or short sales.

The figures showed around 33.8 percent were foreclosures down from the 34.3 percent seen in August and 35.6 percent seen in September 2010. Reports showed 18.7 percent were short sales, which is up from the figure seen in August of 17.5 percent and 15.6 seen in September of 2010.

Home sales in southern California were up 0.3 percent from September 2010 but were down from the 7.7 percent seen in August of 2011 bringing the figure to 18,149. The median price for southern California fell 5.2 percent from 201o to $280,000 and only up 0.4 percent over the August figures.

The Bay Area saw home sales increase 6.6 percent from 2010 but down from the figure seen in August to 6,749. The median price for the area decreased 7.6 percent from 2010 and was also down from the month of August to 365,000.

 

San Diego on the Most Expensive City List

On September 30, Kiplinger magazine published the lists of the most expensive and the cheapest places to live across the nation. San Diego was found on the most expensive list in the tenth position.

As reported by the magazine, the average home price in San Diego is $555,768, making the San Diego metro one of the most expensive places to live in the United States. The average price is not the same figure used by real estate professionals who use the median price instead of average home price. Apartment rentals on average are around $1648 per month, which is double the national average. San Diego has a median household income of $62,901.

San Francisco also made it on the most expensive list in third place. The average home price in San Francisco $808,481, with rentals around $2035, which is, triple the national average. The median household income is $74,876.

Short Sales Growing in Popularity

Short Sales can save borrowers that are underwater as long as everyone agrees. Short sales are for homeowners that want to avoid foreclosure or for those looking for a great bargain, if all goes to plan.

Short sales are transactions in which borrowers owe more on their mortgages than their homes are worth, known as underwater, where the lending company agrees to a discounted payoff. In San Diego County 18.7% of the home resale market for the month in June was short sales, which is up from 2% we saw five years ago, states local real estate tracker DataQuick.

Short sales are growing, however, the process of the closing take time, is uncertain, and changes all the time, which can hinder interested parties.

Kurt Wannebo, a San Diego broker that has over 6 years of experience in short sales stated, “Short sales are changing all the time,” and went on to say, “The banks change their processes all the time … and there are new laws and new short-sale government programs.”

A new state law that was signed in July is meant to help protect short sellers may make the process even longer, more uncertain, and cost the seller more.

Who should use a short sell?

In most cases, those that opt for a short sell are ones that can no longer afford their mortgage and want to walk away as their investment is no longer there.

Shelia Brady and her husband purchased a condo in Rolando for $285,000 in 2004; the condo is now in escrow being sold as a short sale for $120,000. The couple not only lost value but also was behind on their house payment due to surgery that stopped her from working for 2 ½ months while her husband has been unemployed for 2 years.

Why would this couple use a short sell instead of letting the foreclosure process take over?

“You have such a strong moral obligation toward your mortgage,” Brady said. “You sign a document saying, ‘I will do this.’ ”

Greg Ives, 33, purchased a downtown San Diego condo at the Hard Rock Hotel to be used as a rental investment for $405,000. The value on the property depreciated and the amount he could charge for rent depreciated. Once he paid his mortgage, he found he was $1,000 under for several months. He filed for a secure loan modification but was denied, he then decided on a short sale. After five long months, the deal closed. He still owes the lending company and will have to pay $340 per month for the next ten years. He stated that his best option was a short sale. “I’m grateful to be done with it,” Ives said.

For any questions regarding selling your property via a short sale or if you are interested in a buying a short sale property, contact one of our expert real estate agents in the San Diego area.