SAN DIEGO REAL ESTATE AGENT BLOG » Median Price

San Diego County housing prices rebound in February

Michael Carter - San Diego Real Estate Agent — Tue, 16 Mar 2010 00:08:28 +0000

San Diego County housing prices bounced back in February to reach a median $322,000 that was in the range of prices for much of last year, MDA DataQuick reported Monday.

The median, the midpoint of all prices, was up 5.6 percent from January’s $305,000 and up 13 percent from February 2009. The January median price had fallen 7.5 percent from December’s $330,000, reflecting an active market in low-cost homes and little activity in moveup properties.

February’s numbers represented the highest year-over-year increase since March 2005, a few months before the median peaked at $517,500 and then fell to a low of $280,000 in January 2009.

But housing experts caution that January and February do not usually set the pace for sales and price trends for the year because of their traditionally low volume of activity.

Single-family resale homes had a median price of $358,500, up 3.9 percent from January’s $345,000 and just about the same as the December median; the figure was 12 percent ahead of year-ago levels. Condo resales stood at $219,500, up 8.9 percent from January’s $201,500 and nearly equal to the median price in December; it was 12.6 percent ahead of February 2009’s $195,000. The new-home median, including condo conversions, was $460,000, up 13.3 percent from January’s $406,000 and the highest since last May; it was 1.8 percent higher than in February 2009.

Sales in February stood at 2,465, up 6.2 percent from January but 8 sales lower than in February 2009. Single-family resales were below year-ago levels, down 4.2 percent, a reflection of the low inventory of homes for sale, especially low-cost distressed properties, as lenders try to modify loans rather than initiate foreclosure proceedings. Many analysts expect foreclosures to increase this year and thus lead to more sales but perhaps lower prices overall.

By Roger Showley

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Affordability of housing dips in county

Michael Carter - San Diego Real Estate Agent — Thu, 18 Feb 2010 18:26:56 +0000

San Diego County’s housing affordability has again dipped below the 50 percent level, the National Association of Home Builders said yesterday.

The 48.1 score in the Housing Opportunity Index represents the percentage of homes sold in the fourth quarter that a median-income household could afford using standard underwriting guidelines.

The new level positions San Diego as the 13th-most unaffordable market among 227 areas surveyed.

San Diego’s affordability peaked at a record 58.8 percent in the first quarter of last year. The region ranked 31st among least-affordable areas in the third quarter of 2008, its best showing in the 19 years of the survey.

The latest figures were based on a fourth-quarter median price of $319,000 for a single-family resale home, a 30-year, fixed-rate mortgage interest rate of 5.1 percent and a down payment of 10 percent. The median household income in the quarter was $74,900, and the survey assumes that a household will spend no more than 28 percent of income on housing.

Nationally, the index stood at 70.8 percent. Eleven of the 20 least-affordable markets were in California. New York ranked first at 19.7 percent and San Francisco was second at 22.3 percent.

By Roger Showley, UNION-TRIBUNE STAFF WRITER

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Property Values Fall Again

Michael Carter - San Diego Real Estate Agent — Thu, 11 Feb 2010 02:35:27 +0000

U.S. home values declined another 5 percent in the fourth quarter, compared to the previous year. This was the 12th straight quarter of year-over-year declines, reported Zillow.com.

More than 29 percent of homes sold in 2009 in the U.S. went for less than sellers originally paid for them, Zillow said, estimating that more than 20 percent of U.S. home owners owe more on their mortgages than their properties are worth.

“While the next few months are likely to bring further home value declines in most markets, we do expect to see a national bottom in home prices by the middle of this year,” Zillow Chief Economist Stan Humphries said in a statement. “Thereafter, home values are likely to bounce along the bottom with real appreciation remaining negligible for some time.”

Source: Bloomberg, Daniel Taub (02/10/2010)

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Pending Home Sales Stabilize

Michael Carter - San Diego Real Estate Agent — Tue, 02 Feb 2010 21:40:26 +0000

Pending home sales have leveled from a market swing driven by response to the home buyer tax credit, according to the NATIONAL ASSOCIATION OF REALTORS®.

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in December, increased 1 percent to 96.6 from 95.6 in November, and remains 10.9 percent above December 2008 when it was 87.1.

In November, the monthly index had fallen by 16.4 percent from surging activity in preceding months.

Lawrence Yun, NAR chief economist, says it’s important to recognize how the tax credit is skewing market data.

“There are easily understood swings in contract activity as buyers respond to a tax credit that was expiring and was then extended and expanded,” he says. “These swings are masking the underlying trend, which is a broad improvement over year-ago levels.”

December activity was the fifth highest monthly tally in two years.

The Tax Credit Impact

Buyers who have a contract in place to purchase a primary residence by April 30, 2010, have until June 30, 2010, to finalize the transaction to qualify for a tax credit of up to $8,000 for first-time buyers and $6,500 for repeat buyers.

Yun projects the extended and expanded tax credit will encourage 2.4 million households to take the credit in 2010.

“While new-home sales will remain low due to a lack of construction, existing-home sales are projected to rise to around 5.6 million in 2010,” Yun says. Last year there were 5.16 million existing-home sales.

He added that one of the greatest benefits of rising sales will be firming home prices.

“For several months now we’ve been seeing stabilization in all of the home price measures as inventory is pulled down,” Yun says. “As a result, the housing wealth for many middle class families has begun to stabilize.”

Regional Data

Here’s a breakdown by region for the PHSI:

Northeast: rose 2.3 percent to 76.1 in December and is 14.9 percent higher than December 2008.
Midwest: increased 5.2 percent to 86.9 and is 8.7 percent above a year ago.
South: rose 2.2 percent to an index of 98.4, and are 5.5 percent higher than December 2008.
West: fell 3.8 percent to 119.9 but is 18.6 percent above a year ago.

NAR

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

December home sales down nearly 17 percent

Michael Carter - San Diego Real Estate Agent — Mon, 25 Jan 2010 15:51:12 +0000

WASHINGTON — Sales of previously occupied homes took the largest monthly drop in more than 40 years last month, sinking more dramatically than expected after lawmakers gave buyers additional time to use a tax credit.

The report reflects a sharp drop in demand after buyers stopped scrambling to qualify for a tax credit of up to $8,000 for first-time homeowners. It had been due to expire on Nov. 30. But Congress extended the deadline until April 30 and expanded it with a new $6,500 credit for existing homeowners who move.

“It’s ‘exit stage left’ for first-time homebuyers,” wrote Guy LeBas, an analyst with Janney Montgomery Scott.

December’s sales fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million, from an unchanged pace of 6.54 million in November, the National Association of Realtors said Monday. Sales had been expected to fall by about 10 percent, according to economists surveyed by Thomson Reuters.

The median sales price was $178,300, up 1.5 percent from a year earlier and the first yearly gain since August 2007. However, some of that increase could be due to a drop-off in purchases from first-time buyers who tend to buy less expensive homes.

Sales are now up 21 percent from the bottom a year ago, but down 25 percent from the peak more than four years ago.

The big question hanging over the housing market this spring is whether a tentative recovery will stumble after the government pulls back support. The Federal Reserve’s $1.25 trillion program to push down mortgage rates is scheduled to expire at the end of March – a month before the newly extended tax credit runs out.

Last year, first-time buyers were the main driver of the housing market, but their presence is on the decline. They accounted for 43 percent of purchases in December, down from about half in November, the Realtors group said.

The inventory of unsold homes on the market fell about 7 percent to 3.3 million. That’s a 7.2 month supply at the current sales pace, close to a healthy level of about 6 months.

Total sales for 2009 closed out the year at 5.16 million, up about 5 percent from a year earlier. That was the first annual sales gain since 2005. But prices fell dramatically last year, declining 12.5 percent to a median of $173,500, the largest decline since the Great Depression.

Though the results missed Wall Street’s expectations, the Realtors’ group says there are signs the market is finally stabilizing.

“There is some sustainable momentum building in the housing market right now,” said Lawrence Yun, the group’s chief economist. However, he cautioned that the recovery will depend on whether the economy starts adding jobs in the second half of the year.

Many experts project home prices, which started to rise last summer, will fall again over the winter. That’s because foreclosures make up a larger proportion of sales during the winter months, when fewer sellers choose to put their homes on the market.

Despite fears that home prices are starting to fall again, some analysts still believe the worst is over.

“We do not believe it is fair to consider this a double dip in the housing market,” Michelle Meyer, an economist with Barclays Capital, wrote last week. “The recovery is still under way, but hitting some bumps in the road.”

By Alan Zibel, Associated Press

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Nine Consecutive Gains for Pending Home Sales

Michael Carter - San Diego Real Estate Agent — Wed, 02 Dec 2009 16:46:25 +0000

Pending home sales have risen for nine months in a row, a first for the series of the index since its inception in 2001, according to the NATIONAL ASSOCIATION OF REALTORS®.

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in October, increased 3.7 percent to 114.1 from 110.0 in September, and is 31.8 percent above October 2008 when it was 86.6. The rise from a year ago is the biggest annual increase ever recorded for the index, which is at the highest level since March 2006 when it was 115.2.

Lawrence Yun, NAR chief economist, said home sales are experiencing a pendulum swing. “Keep in mind that housing had been underperforming over most of the past year. Based on the demographics of our growing population, existing-home sales should be in the range of 5.5 million to 6.0 million annually, but we were well below the 5-million mark before the home buyer tax credit stimulus,” he said. “This means the tax credit is helping unleash a pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future.”

By Region

Pending sales in the Northeast surged 19.9 percent to 100.2 in October and is 44.2 percent above a year ago.
In the Midwest, the index rose 11.6 percent to 109.6 and is 36.6 percent higher than October 2008.
Sales in the South increased 5.4 percent to an index of 115.4, which is 31.6 percent above a year ago.
In the West, the index fell 11.2 percent to 127.7 but is 21.9 percent above October 2008.

Not Out of the Woods Yet
Yun cautioned that home sales could dip in the months ahead. “The expanded tax credit has only been available for the past three weeks, but the time between when buyers start looking at homes until they close on a sale can take anywhere from three to five months. Given the lag time, we could see a temporary decline in closed existing-home sales from December until early spring when we get another surge, but the weak job market remains a major concern and could slow the recovery process.

“Still, as inventories continue to decline and balance is gradually restored between buyers and sellers, we should reach self-sustaining housing conditions and firming home prices in most areas around the middle of 2010. That would mean broad wealth stabilization for the vast number of middle-class families,” Yun said.

Source: NAR

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Home prices across area ending decline, data show

Michael Carter - San Diego Real Estate Agent — Tue, 20 Oct 2009 03:38:50 +0000

San Diego County’s three-year slide in home prices is ending, neighborhood by neighborhood, according to a quarterly breakdown from MDA DataQuick.

Eight out of 56 neighborhoods saw higher prices than a year ago, compared with only one or none in the recent quarters, DataQuick said. The findings are based on ZIP codes with at least 50 single-family-house resales in the latest three-month period.

Overall, the resale median price of $360,000 was down only 5 percent from $379,000 in the same quarter last year, a big improvement from the 24.2 percent slump from 2007, when it stood at $500,000.

Robert Brown, a Cal State San Marcos economics professor, said he has been watching price declines lessen since April.

“There certainly has been an uptick in North County in the last three or four months,” Brown said.

Escondido West (ZIP 92029) saw the biggest increase, 15.1 percent, from a median of $467,000 in the third quarter of 2008 to $537,000 this year, and Brown said relatively few distressed properties may be the reason.

Sue Scott, a longtime real estate agent in the area, said the semirural setting near Lake Hodges and low turnover in ownership have sustained values.

“I think we do better than elsewhere, comparatively,” Scott said.

DataQuick numbers back her up. The median for the Escondido West area is down 21 percent from the 2007 peak of $680,250. That compares with a countywide median decline of 35 percent from the 2006 high of $554,000 to $360,000 in the third quarter this year.

By contrast, many more areas continue to post lower year-over-year prices, with three central San Diego city neighborhoods among the five worst performers.

Golden Hill (92102), east of downtown, was off 32.3 percent to $152,250 and down 65.4 percent from its 2006 peak of $440,000.

Peter Dennehy, senior vice president at Sullivan Group Real Estate Advisors, said these fast-sinking neighborhoods were among the last to see an upsurge during the early-2000s bubble market. As prices elsewhere soared, desperate buyers with shaky financing bought there, where prices were lowest.

“They came late to the appreciation curve and really boomed in what I’d call the ‘unfortunate’ years, when subprime mortgages were quite prevalent,” Dennehy said of the worst-performing ZIPs.

Scott Holder of Aloha San Diego Properties in Golden Hill called the inner-city markets “schizophrenic” because investors outbid first-time buyers now.

“We have people that want to buy and can’t buy,” Holder said.

Many agents report that the inventory of homes for sale is shrinking because the supply of distressed properties is down — a situation that may change if an expected new wave of foreclosures materializes. The San Diego Association of Realtors said the number of active listings for detached homes this week stood at 5,670, down from 8,562 in mid-July.

Meanwhile, owners of nondistressed homes do not want to sell because they hope prices last seen in 2006 will return soon. That may not happen for 10 more years, agents say.

Analysts caution not to read too much into price trends, because they vary greatly in market mix. During one quarter there may be many small, low-priced houses that change hands, and in another, more higher-priced listings.

Mark Lau of WKL Financial, a real estate office in central San Diego’s City Heights neighborhood, said he was surprised that his area dropped 17.8 percent in the third quarter to a median of $183,000. That compared with $222,500 in the same period in 2008 and a record $411,000 for all of 2006.

“My feeling was it was going up,” based on multiple offers and overbids on foreclosure properties, Lau said.

In one recent case, a client made an all-cash bid of $190,000 on a home listed at $150,000. There were 38 offers, and it went to someone else.

“We got beat up so many times, we learned our lesson to go higher,” Lau said.

In Chula Vista, where prices continue to fall, Ramon Zamora of Executive Brokers Real Estate said frustrated first-time buyers will probably have to wait their turn.

Investors, although often offering less money, are making winning bids by paying all cash. They spend $5,000 to $20,000 on repairs and upgrades, then sell the homes to first-timers for thousands more than they invested.

“It’s not that it’s a better deal; it’s just the way the first-time buyer can get it,” Zamora said.

Ray Metcalf, a 30-year-veteran real estate broker in Oceanside, said he has backed out of the realty business for the time being because it is dominated by what he called “a bunch of barracudas” — bottom-fishing investors and banks eager to rapidly unload foreclosures.

“The industry is no fun anymore,” Metcalf said.

Linda Bell at Panda Realty in Poway characterized the market as being in a “frenzy.”

“Everybody just goes bananas over the cheap ones,” Bell said.

But she and other agents predicted continued problems in San Diego real estate if the economy continues in its weakened state with little growth and high unemployment.

“People who are not making money can’t buy a house,” Bell said.

By Roger Showley

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Federal Index Shows Home Prices Rising

Michael Carter - San Diego Real Estate Agent — Wed, 23 Sep 2009 23:37:12 +0000

U.S. home prices rose 0.3 percent in July compared to June, the Federal Housing Finance Agency said Tuesday.

The index is 4.2 percent below what it was in 2008 and 10.5 percent off its peak in April 2007.

The index excludes most expensive homes from its calculations, so prices appear to have declined less than they have by other measures.

The report “supports other evidence that the three-year long decline in prices has come to halt,” Paul Dales, U.S. economist with Capital Economics, wrote in a note to clients.

Other economists were less positive. “We think house price indexes are likely to edge somewhat lower in the fall when foreclosures become a larger share of home sales,” Barclays Capital economist Nicholas Tenev wrote in a note to his clients.

Source: The Associated Press, Alan Zibel (09/22/2009)

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

New Home Sales Surge 9.6% in July

Michael Carter - San Diego Real Estate Agent — Thu, 27 Aug 2009 02:19:38 +0000

New U.S. home sales surged 9.6 percent in July, rising for the fourth straight month
and beating expectations as the housing market shows continuing signs of rebounding from its historic downturn.

The Commerce Department said Wednesday that sales rose to a seasonally adjusted annual rate of 433,000 from an upwardly revised
June rate of 395,000. Sales are now up 32 percent from the bottom in January, but off 69 percent from the frenzied peak four years ago.

Last month’s sales pace was the strongest since September and exceeded the forecasts of economists surveyed by Thomson Reuters, who
expected a pace of 390,000 units. The last time sales rose so dramatically was in February 2005.

The median sales price of $210,100, however, was still down 11.5 percent from $237,300 compared to the same time a year ago.
There were 271,000 new homes for sale at the end of July, down more than 3 percent from May. At the current sales
pace, that represents 7.5 months of supply, the lowest since April 2007. The decline means builders have scaled back on construction to the point where supply and demand are coming into balance.

Source: Associated Press, Alan Zibel (08/26/09)

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774

Existing-Home Sales Rise 7.2%

Michael Carter - San Diego Real Estate Agent — Fri, 21 Aug 2009 14:42:02 +0000

WASHINGTON — Existing-home sales rose to their highest level in nearly two years from June to July as cheaper prices and the availability of tax credits continued to entice buyers.

Home resales rose more than expected, bouncing 7.2% — the highest month-over-month percentage increase in more than a decade — to a seasonally adjusted 5.24 million annual rate, the National Association of Realtors said Friday.

Analysts surveyed by Dow Jones Newswires had expected an annual sales rate of 5 million.

“The housing market has decisively turned for the better,” said Lawrence Yun, the NAR’s chief economist.

The NAR last month estimated June sales rose 3.6% to 4.89 million. That figure was not revised.

Foreclosures and short sales reflect 31% of sales in July. Distressed property sales have pushed prices lower, year over year, attracting buyers not sidelined by unemployment or tight credit conditions.

The median price for an existing home last month was $178,400, a 15.1% decrease from July 2008.

Previously owned home sales, year-over-year, were up 5.0% from the pace in July 2008, the NAR report said.

Weak demand has kept inventories of unsold homes high, driving down prices. Inventories of previously owned homes climbed 7.3% at the end of July to 4.09 million available for sale.

“The additional inventory likely is a result of some held back inventory coming back to the market,” Mr. Yun said.

That inventory level represents a 9.4-month supply at the current sales pace, compared to 9.4 months in June.

Regionally, July sales rose 13.4% in the Northeast, 7.1% in the South and 10.9% in the Midwest. July sales slid 1.7% in the West.

The average 30-year mortgage rate fell to 5.22% in June from 5.42% in June, Freddie Mac data show.

By MEENA THIRUVENGADAM

Michael Carter
San Diego Real Estate Agent
MTC Future Realty
(619) 488-5774