San Diego Housing – Slow, Steady, and Stable
Like many other metropolitan areas, San Diego has seen an increase in home sales in recent months. Buyers looking for warm weather, sunny beaches, and low mortgage rates have been attracted to this paradise by the sea. But while other cities around the country have experienced rapid growth, the housing market's recovery in San Diego is happening at a much slower pace.
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Here’s how the numbers play out:
The California Association of Realtors reported last week that existing home sales in San Diego increased by 5.1% in 2012, and they forecast a 1.3% percent growth in 2013. That means that while home sales are up, they aren't skyrocketing! But it still shows growth, and that’s something the region's real estate industry hasn't experienced in recent years. As a result, sellers here are optimistic. Through last week, the San Diego metro’s average listing price ($582,265) has only slightly increased (0.4%) since last year, but the median sales price ($357,500) has grown 18.7% when compared to same time frame in 2011. That means that buyers here are purchasing more expensive homes than they were this time last year. That's a big change from the last few years, when foreclosures and short sales made up a majority of the homes sold. While there are still plenty of distressed properties on the market, the increase in high-dollar home sales has driven the median sales prices up. That's good news for homeowners living in the San Diego area. Higher sales prices mean more value for your properties, if and when the time comes for you to sell! But while existing home sales are up, construction of new homes has been stagnant.
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Perhaps the main reason that San Diego has not seen the number of new construction homes increase in the past year is because of land constriction. While many similar sized cities continue to expand, San Diego and its neighboring suburbs sit by the Pacific Ocean, meaning there's only so far the city can grow. While the lack of land limits the number of new homes that can be built, it can actually help the market in another way. As demand for homes in the area increases, but the supply remains limited due to land constrictions, home prices will continue to rise. Experts say they expect fewer single-family homes to be built in the coming years, as landowners opt for more bang for their buck by constructing high rise condo buildings.
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So, what does all this mean?
If you own a home in San Diego and have been thinking of selling it, now's the time to list the property. But don't expect it to sell overnight, or to make a tremendous profit on the sale. Remember, San Diego's housing market is showing a slow, but steady recovery. If you're a buyer, now is also the time to start seriously considering your options. Home prices are on the rise in San Diego, and will continue to increase as sales numbers go up. The sooner you buy, the more likely it is that you'll get a deal on a home. Either way, owning real estate in this part of the country is wise investment, both for the immediate future and down the road!
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