You may have seen the negative housing market headlines in the media, but you should read them with calm or skepticism. There isn’t reason for alarm. National housing trends, like the steady rise in home prices and decline in inventory, should certainly be understood, but tracking wider economic conditions is key. Buyers want to get into the market, but unlike the real estate market of ten years ago, people are blindly (or greedily) jumping into risky loans.
In San Diego county as of March 2016, closed sales decreased 6.7 percent for detached homes and 0.6 percent for attached homes. Pending sales increased 3.1 percent for detached homes and 9.9 percent for attached homes. Inventory decreased 15.0 percent for detached homes and 25.8 percent for attached homes. This drop in inventory is fuel for the strong seller’s market we are experiencing.
The median sales price was up 7.0 percent to $551,000 for detached homes and 4.0 percent to $360,000 for attached homes. Days on market decreased 14.0 percent for detached homes and 26.2 percent for attached homes. That means homes for sale are selling much quicker than in the past and that demand for homes is high.
So, what’s happening next?
Employment figures are positive, wages are going up and employers are hiring. Consumers are holding for the right deal, even in the face of extremely low mortgage rates. As seller and builder confidence increases, we should see more activity in the second quarter 2016. The second quarter tends to rank as the best time to list a home for sale.
But if inventory stays low, it will be difficult to sustain sales increases in year-over-year comparisons. Prices are seemingly not so high as to stall the market completely. Demand is present but an abundance of choice is not.
You’ve heard this before, but seriously, in San Diego, now is a great time to sell your home! My latest listing in Del Sur had 3 offers for above asking price within two days of going on the MLS. My buyer clients continue to encounter multiple competing offers. The second quarter is heating up and if you are considering selling your home, this feels like the ideal time.