San Diego Neighborhoods Immune to Crisis

San Diego home prices fell sharply last year but the decrease in price varied among San Diego neighborhoods, says DataQuick.

There were some areas in San Diego where prices fell as much as 50% but other areas actually showed an increase.

In actuality, according to DataQuick analyst Andrew LePage, neighborhoods in San Diego such as Chula Vista, with price declines were fed by an abundance of low-priced foreclosure sales. By contrast, those areas such as Pacific Beach with relatively few foreclosures suffered fewer, if any, price drops.

LePage deconstructed the North County Coastal subregion in December to show how neighborhoods with lots of distressed properties can overpower those less affected by mortgage defaults, foreclosures and panicky investors.

In December 2008, the north coastal in cities like Carlsbad and Del Mar median price was $375,000 for resale houses, down 41.9 percent from December 2007. Oceanside suffered the most decline in the region and if you were to take these figures out of the calculation then the decline would only show a measly 22.7%.

Cities like Solana Beach, which remains the one of the county’s more desirable coastal communities, was surprisingly resilient to the decline in the market, showing nearly 25 percent increase in housing values at a time when most neighborhoods experienced sharp declines. Its increase was the highest in San Diego county. The median price last year for all homes in the Solana Beach was $1,060,000, based on 188 sales — which was only 12 fewer sales than in 2007.

It must be noted that Solana Beach had only 2 foreclosures in the entire city which may account for the unusually high price appreciation.

Another city  that has fared well is downtown San Diego which revealed a 7.4 percent rise in median home price, despite the fact that there are still hundres of new, unsold condos in the neighborhood.

Downtown San Diego, however, is something of an aberration compared with other neighborhoods the figures include prospective buyers that typically make commitments to purchase condos long before the buildings are completed. The median price for all of last year was $522,000, compared with $486,000 a year earlier.  Others are akin to the aberration.  San Diego Real Estate agent Mike Carter noted that there were about 4 major buildings that started escrow closings in 2008, and all of those were  based on 2005 and 2006 pre-sales, so the prices reflected the pricing of several years earlier.  Mike Carter as well as other downtown real estate agents indicated that the market is struggling mightily in the downtown San Diego.

Success stories in 2008 were very few as data showed that last year was only second to 1995 in terms of declines.  In fact, some areas including Logan Heights was hit the hardest and felt a 48 percent decline in sale prices.  Chula Vista was second with nearly a 40 percent drop

By comparison, in 2003, the median price for single family homes in the San Diego soared more than 35 percent to $250,250 — the highest increase in the county for neighborhoods with at least 75 sales that year. Three years later, the median had jumped to $395,000, more than twice the neighborhood’s current median of $166,500 for single-family home resales.

The worst performing subregion was North County Inland, where the overall median dropped 29.4 percent to $367,000, compared with $520,000 in 2007. Escondido’s 92025 and 92027  dropped more than 40 percent, and Rancho Santa Fe’s 92067 was the only ZIP with at least 75 sales to increase, by 2.3 percent to $2.4 million.

South County, the scene of so much foreclosure activity, ranked second with a downturn of 28 percent to $324,000 from $450,000 in 2007. National City performed poorest of all, down 45 percent to $220,000 from $400,000 the year before.

East County fell 26.8 percent to $300,000 from $410,000 with Lemon Grove and El Cajon 92020 down the most among larger ZIPs, off 38 and 36.2 percent, respectively. No communities posted any increase.

North County Coast was down 22.5 percent for the year to $465,000, from $600,000 in 2007. Central San Diego saw a 20 percent decline to $360,000 from $450,000 in 2007.