San Diego Market Update: Q4 Appreciation Data Trends and Forecasts, by Denise Matthis.

By Denise Matthis

Appreciation Data Trends and Forecasts

As per the California Association Realtors resale housing report in June 2021, San Diego’s current median price is at 865,000, a 27.6 percent gain over last year’s price marking a 29.2 percent sales increase. This has made San Diego the second most expensive real estate market in California after Orange county. Also from the CAR report, the existing single-family home sales increased by 16 percent MTM, a 29.2 percent increase over last year while the condominium market hiked in the median price to $550000 with a gain of 1.4 percent as compared to last year. Over the past ten years, San Diego has shown an appreciation rate of 82.7percent which is a 6.22 percent annual rate, and a home value increase of 22.5percent as recorded by NeighborhoodScout. com, a real estate data provider placing San Diego in the top 10 percent countrywide for real estate appreciation. The city has depicted an annual appreciation rate of 7.95 percent for the last one and a half years. This is due to the limited supply of homes which has forced buyers to compete leading to higher prices that benefit the sellers.

As per Zillow.com, a real estate database company, home prices skyrocketed in late 2012 and there has been a steady growth in home prices since then to mid-2017. From late 2017 to 2018, home prices sharply declined due to high mortgage rates and less buyer’s demand for houses. In mid-2019, the prices rose again and this has been the case to now. Low inventory and low mortgage rates have led to high buyer’s demand resulting in higher prices. The median sale price of single-family homes in March was $675000, indicating an 8.2 % increase year-over-year.

In April median prices rose by 10,000 and the appreciation rate by 1.5 percent to 7.2 percent higher than last year. The appreciation rate in

May rose by 0.8 percent while the home sales declined by 43.2 percent marking a 42.7 yearover-year drop of active listings. As per NeighborhoodScout.com and two-bedroom, single-family detached houses are the most common housing units in San Diego. Rentals show the average increase in prices for different houses from last. In order to be well informed on the housing market trends in San Diego, you have to understand the percentage change year-overyear for June 2021.

Despite the pandemic, the San Diego market is still hot and shows no signs of shifting to the buyer’s real estate market. The city can only shift to being a buyer’s market only if the supply rises to 5months of inventory. This, however, is unlikely to happen due to an imbalance between supply and demand. As of now, the inventory supply is at 1.5 months which means that the San Diego market is dominated by buyers. Also, Mortgage rates are still low. They declined to 2.98 percent compared to 3.16 percent last year. With all these circumstances, it is therefore unlikely for the housing prices in San Diego to fall any time soon.

It additionally may be hard for the housing prices to fall since there is less or no construction of houses as depicted in Single Family Residential (SFR) Construction in San Diego. The Coronavirus pandemic has impacted the San Diego housing market in that, most buyers have withdrawn their offers and sellers removed their homes from the housing list. There are hence not enough homes listed to satisfy and meet the high levels of demand.

San Diego is an ideal place for investment and dwelling due to its beautiful beaches, unique culture, favorable weather, and academic facilities. The city will therefore continue being in high demand as far as real estate is concerned. San Diego has recently shown great real estate market trends that may be in favor of investors. These trends include employment, increased home values, and low long-term mortgage rates, and increased Gross Domestic Product. Looking at the market trends, it is still a good time to invest in San Diego. As San Diego continues to be one of the fastest-growing cities in the United States, there will be more demand for buyers and investors. With the coronavirus pandemic on, most sellers may not be willing to put their homes on the list, and mortgage rates are not likely to fall. Moreover, the construction of new homes may take a while as construction materials are a bit expensive. For this reason, supply will still be less than the present demand which means housing prices will still be high. Buyers who want to become homeowners in San Diego should take advantage of the current low rates and buy now before rates rise again to pre-pandemic rates. This is your time to live in one of the best cities in the United States. This is the best time for you to become a homeowner in a location you have always desired in the most affordable way. Do you want to know how? Reach out to Eric Lawrence Frazier MBA DRE 01143484/NMLS 461807 or contact Denise Matthis, one of our VIP agents located in San Diego today and find out more!

ABOUT DENISE MATTHIS

Although not a true “San Diego Native”, Denise E Matthis has been a resident of San Diego since the age of 2. Denise is the Owner/Broker of DEM Financial Services & Real Estate, a boutique brokerage dedicated to promoting community pride through homeownership and building & preserving generational wealth with real estate. As a buyer’s representative, she is passionate and works with first-time home buyers and veterans educating them on the home buying process and works with investors. As a seller’s representative, she specializes in seniors, probate, and distressed property sales. To learn more about Denise, go to; https:// thepowerisnow.com/denisematthis/

ABOUT THE POWER IS NOW MEDIA, INC.

The Power Is Now Media Inc. is an advocate for the empowerment of the minority communities all around the United States. We engage with various thought leaders to make sure that you are equipped with knowledge about our economy. We have partnered with First Bank to provide you with products and services that will help you prepare better for the future. We are also advocating for first-time home buyers. The Power Is Now Inc. can help make your homeownership dream a reality. Go to www. neverrentagain.com and get started today.

References

https://www.noradarealestate.com/blog/san-diegoreal-estate-market/ https://www.sandiegorealestatehunter.com/ blog/san-diego-real-estate-market-forecast/ https://journal.firsttuesday.us/san-diego-housingindicators-2/29246/ https://www.fortunebuilders.com/san-diego-realestate-market-trends/