San Diego Home Prices Hit a High Due to Low Inventory
If you’re currently looking for a home in the San Diego area, you may be surprised to find that there isn’t that much inventory out there right now. The good news is that if you plan on selling your home, chances are you will have several offers within a few days. The real estate market in San Diego continues to move in an upward trend. However, experts agree that the spike in home prices are due to the lack of supply. So, as demand has a harder time being met, prices tend to go a bit higher.
According to Core Logic, the number of homes within the area increased by 2 percent from last year. This modest number seems healthy, and it really is. If you look at the fact that the number is accompanied by a spike in sales price of 5.1 percent from last year, you will find that there is a basic supply and demand issue. This issue is a far cry from speculation or any subprime lending issues from the past. The market is still overall healthy, but when inventory is scarce, prices do have a tendency to rise. Plus, home prices haven’t hit their peak. Before the recession took hold in 2007, the average home price was $517,000 in 2005—the year when the San Diego real estate market hit its peak. Today, the average home value in the area is $478,000.
Low mortgage rates are still continuing to switch potential homeowners into actual ownership. Plus, low rates are allowing potential home buyers to still enter the market. Furthermore, for homeowners who are currently in starter homes, now is the perfect time to move up. With the market needing inventory, you’ll be able to move your property fast. Also, you will still be able to take advantage of lower interest rates as you move into a larger home that can meet your needs.
For more of our perspective on this subject read our recent blog, “Sales Contracts Peak High in Recent Months: Here’s Why.”
Thinking of buying or selling a home in the La Jolla area? As consistent top producers in real estate, Linda Daniels and The Daniels Group are your La Jolla housing specialists. Working with The Daniels Group will give you with the advantage of having local experts to ensure that you have a successful real estate transaction. From buying, selling and investing to financing options and more, we have the expertise and resources to help you achieve your goals. Call us today at (858) 361-5561 or email us anytime.