Luxury San Diego real estate

After the real estate market posted its best year in 2013 since 2005, the S&P Case-Shiller index found that home values in the 20 largest metros dropped slightly for two months in a row. While some economists are dreading a backward-trending year for the market, others are certain that the slowdown is just seasonal.

Robert J. Shiller, a Yale economist and co-creator of the index, told the Los Angeles Times that he’s worried home prices will fall on an annual basis by the end of 2014, in part due to investors leaving the market and home building still slow to kick into gear to meet the high demand for homes in many parts of the country, including Southern California.

San Diego Real Estate Market

To put some of this information into perspective, turn to Altos Research data. The California-based real estate analytics company found that the median single-family home price in San Diego sits around the same mark as it did a year ago. Case-Shiller data does lag behind Altos, as they post on a weekly basis. However, in San Diego, the median price point hasn’t shifted too drastically since the same time Case-Shiller released their most recent report.

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One important thing to note about the real estate market in San Diego is that inventory is actually higher now than it was at the start of the year, but is still low compared to where it should be. Altos posted the amount of available supply at 1,285 properties as of February 28. It was below the 1,000 mark a year ago. And while demand has also fallen in San Diego, it still remains high above the available inventory, creating a seller’s market.

Altos’ Market Action Index, which measures whether a market favors buyers or sellers with 30 as the neutral value, has not dipped below the 30 mark in the past year. This means it has consistently favored sellers. It was marked at 36.28 at the end of February, which was its lowest mark in at least a year.

“Two of the bigger questions hanging over the housing market right now are, ‘How much pent-up demand is left out there?’ and, ‘Will inventory skyrocket this year as more owners take advantage of the price run-up?’” DataQuick president John Walsh said in a statement. “Unfortunately, we’ll probably have to wait until spring for the answers. When it comes to statistical trends, January and February are atypical months that haven’t proven to be predictive over the years.”

Going into March and April, home sellers in San Diego may see a much different real estate market than they have in the past couple months. Economists are wishful that home sellers who have been sitting on the sidelines will enter the market to offset the high demand that has been taking place in San Diego for quite some time.

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(all data current as of 10/22/2017)

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