Like much of the state of California, San Diego real estate is in an inventory crunch with so much demand that the market is weighted heavily into the hands of sellers. As the country is returning to pre-recession levels in both the job and housing market, trends point in a positive direction. As prices continue upwards, more individuals will be interested in selling their homes, opening up the inventory and allowing the San Diego real estate market to reach healthy levels.
December home sales declined along the coast with a 17.5 percent dip in San Diego County since last year, most notably due to the tight inventory. San Diego also experienced a 15 percent price increase, year-over-year. At the same rate, the guidelines for home mortgages are becoming more restrictive, slowing down the market.
Looking at charts by Zip Realty, San Diego housing inventory started out in 2013 much lower than it did in the three years prior, but it ended near the same rate as 2012. According to Altos Research, a California-based real estate analytics company, there were 1,384 properties available in San Diego as of January 17, and properties were averaging 81 days on the market.
The Low, Low Inventory
However, the market was saturated with investors banking on low prices, short sales and foreclosed homes after the bubble burst. Today, there are much fewer investors snatching up properties because, although prices haven’t reached the point where they should be at, they have increased significantly. Couple that with increased mortgage rates and a tighter inventory and San Diego home buyers are starting to have much less competition from investors.
According to a recent report by the Voice of San Diego using data from Zip Realty: “Months of inventory is a very important statistic, because it provides a good idea of whether prices are experiencing upward or downward pressure. It’s no coincidence that the huge rise in prices over the past two years was accompanied by a low-and-dropping level of months of inventory. This trend culminated in spring 2013, at which point months of inventory was at ridiculously low levels and prices were rising very fast.”
Increasing interest rates are going to play a big role in the health of the San Diego housing market, although it will likely affect first-time and low-level home buyers more than luxury home buyers. And, of course, new home constructions are going to make a big impact in home values and the available supply of homes. All in all, the market will climb, but expecting a full recovery is far-fetched.
If you’re interested in purchasing a San Diego luxury home, we would love the opportunity to show you this exclusive beach town. Please contact our team of luxury property experts.
Take a Look at These San Diego Luxury Homes for Sale from $2,000,000 to $4,000,000
$2,599,000 : 10817 Cherry Hill Drive, San Diego8 beds, 5 baths
$2,599,000 : 10817 Cherry Hill Drive, San Diego5 beds, 5 baths
$2,200,000 : 4774 Coronado Ave, San Diego8 beds, 5 baths
$2,470,000 : 14909 Valle Del Sur Court, San Diego6 beds, 7 baths
$3,019,900 : 888 W E Street #3604, San Diego3 beds, 3 baths
See all City of San Diego Luxury Homes For Sale.
(all data current as of 10/22/2017)
Listing information deemed reliable but not guaranteed. Read full disclaimer.