Do we have a Sellers Market in San Diego?

I just finished doing my bi -monthly analysis of the market conditions in the San Diego region and I was struck by how many of the local zip codes have an inventory of less than 6 months.

If you have been following my blog you will probably remember that the mark to differentiate between a buyers and a sellers market is the months of inventory available for sale at a given time frame. Any market that has 6 months worth of inventory or above is considered to be a "Hot" market or a "sellers" market.

This morning I checked 21 different zip codes in the area and found that 12 out of those 21 had an inventory that was under the 6 month mark and only 4 had an inventory above the 10 month mark.
The other interesting factor that came to be apparent in this mornings research was that many of these areas with low inventories had sold for an average of 100 percent of asking price or more. Another clear sign of a Hot Market that we had not seen in a long time.

Among the areas with the lowest inventory rates are the following zip codes:

Zip Code Inventory
91010 3.83
91913 3.57
92010 2.9
92122 3.8


Two of this zip codes belong to Chula Vista, one more to Carlsbad and the last one is in University City.

It is not surprising that most of the areas with the hottest markets at this point are also the areas that had the highest drop in prices and the highest number in foreclosures and short sales in the county.

Now looking at the zip codes that currently have the highest inventory we see:

ZIP CODE INVENTORY
92014 9.35
92075 11.45
92037 12.4
92101 9.73
92067 33.4


Most of this areas are coastal areas or very expensive zip codes with multi million dollar homes that have an average selling price of around $400 to $500 dollars per square foot. This are homes that would require jumbo loans if someone wanted to purchase a home with a 20 or 30% down payment.

The one exception to this last statement would be the 92101 zip code that belongs to the Downtown San Diego region. The situation with downtown is different because of the recent overflow of new projects that have been built in the last few years, that include many high rises and multi unit condos that have inundated the market in that particular area.


So as a conclusion from this morning look at the Real Estate market latest numbers I must say that at least for now the market HAS shifted into a hot market in the low to mid range priced areas and is staying cool at the upper priced regions.

The question still remains what is driving this market upswing? many believe it is the first time home buyers fueled by the tax credit incentive that is about to go away. together with the low mortgage rates and investors jumping in to buy well priced properties at bottom prices.


I hope you find this information helpful and if you are interested in getting any more specific details regarding the data that was used for this Blog, please feel free to contact me.


rina@my858realtor.com
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Has buying foreclosures become a speed sport?

If you are someone who has been thinking of taking advantage of the current Real Estate Market crisis and all those foreclosure properties that have been hitting the market, you are not alone, you are however thinking too much and not acting fast enough.

What I mean by that is that there are many people already out there trying to do just that, they are making offers and trying to buy these properties. You have individuals looking to buy their personal residence, small investors looking at one to four properties and you also have major investors looking to buy in bulk or at the very least very large quantities of bank owned properties also called REO's.

There are in fact so many people trying to buy them, that when you put it together with some of President Obama foreclosure prevention efforts, particularly the foreclosure moratorium, the outcome has been that it brought the inventory of homes in the $300,000 range which is the average REO listing price way down, according to the California Association of Realtors it went from a 10 month inventory to a 3.5 month inventory in one year. Nationally REO's went down 26% from June of 2008 to June of 2009.

Some areas like Sacramento which was one of the hardest hit areas by foreclosure's are even down to a 30 day inventory or less.

So, how is this translating into the actual buying process? Well,people who are looking to buy these homes basically are getting just one shot at making and offer, they have to offer what has been now called their "highest and best" gone are the days of negotiating, starting low and getting a counter offer. If you have been writing offers and trying to buy a property for the last 6 months, by now you know that if you see a good one you act on it quickly, you come in at asking price or over asking price and when you are looking you better be ready to move fast or it won't be there by the time you are ready, this means having your financing in place, pre-approval and proof of funds as well as down payment all ready to go.

When you look at what has been happening it is very interesting to see that some of the properties in this up to $500,000 price range come into the market and go into pending sometimes less that 2 hrs later. Before banks were leaving properties on the market for 3-4 months before accepting an offer, however some banks finally figured that it was costing them too much in HOA's, taxes and other fees so they are moving them very quickly.

The other reason some people have mentioned as to why are trying to get this properties out of their books quickly is because they are concerned of a new wave of foreclosures inundating the market sometime next fall.

One of the ways that they had managed to lower the number of foreclosures was by trying to do loan modifications with some of the homeowners, I have to say that from what I have seen not many of these have worked out, most people have gone to the next option which is attempting a "Short Sale". From the ones that were modified, it has been reported that 53% of them have fallen back into arrears, making Loan Modifications only a temporary extension of the problem but not a solution, and one of the reason for that concern regarding a new wave of foreclosures.

Short Sales and Loan modifications are 2 other subjects that I would like to address on a later post, there is a lot to be said about them as well.

But in closing, The market for REO's at the price point we have been addressing here is a hot market and the more information you have and the faster you can make an educated offer, the greater the chances of your success in acquiring one of these homes. You will be in a much better position if you have an experienced team and a clear strategy.

If you want any information or need any help getting started just contact us and we will be happy to help

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Best Regards,

Rina Podolsky
Rina@my858realtors.com

Area specific housing data for San Diego

As promised yesterday, I have more specific data for you.

I found an interesting tidbit of information I wanted to share with everyone;
According to Professor Pigginton,the single family median price per square foot was down a gruesome 6.1% between October and November which indicates a market still declining, however, he also mentions that the home inventory in San Diego has shrunk by 22% from where it was a year ago, this is relevant because it is one of the first signs of a market beginning to turn.

Now lets go ahead and look at some data for specific areas as of today:

ZIP ACTIVE PENDING SOLD* SOLD**
92101....573............109.........55...........669
91913....359............217..........86...........752
91914....179.............102.........40..........293
91911.....335............198.........49..........560
92057....406............184.........89..........975
92014....168.............11...........5 1..........33
92024....256............55...........14.........428
92037....408............66............27........497
92067....257.............13............6..........123
92130....219............63............30........569

This is only a very small sample of areas in the county, if there is any one area you would like to hear in my future postings, let me know.


For now I leave you with some questions. How do you feel about the government making this massive monetary commitments in order to bail out different industries? Do you know where this money is coming from? What does it mean for our future economy?



*Properties sold between the dates of November 20,2008 and December 20,2008
**Properties sold between January 1st,2008 and December 20, 2008


All data provided by local MLS






Best regards,



Realtor Rina

So...How is the Real estate Market???

This is a question I hear every day, and in all honesty...there is no simple answer.
The reality is that it all depends on why you are asking? it is not that the facts change, it is that the focus you have while looking at those facts creates a whole different explanation.

And as if that was not enough...we cannot talk about a Real Estate market in San Diego in general and expect to have an accurate picture of all areas. You have to clearly define what area in San Diego county you are interested in. If you look at Chula Vista it is an entire different picture than Encinitas for example.

Now having said that, let's take a look at certain current conditions that do affect the market in general.



Even though there has been talk about the banks shifting their aim from foreclosing on faulty loans to attempting to work things out and renegotiating with the homeowners who have this loans, it takes time...unfortunately for those people already going through the process of being foreclosed upon, this shift has come too little to late. And we have yet to hear from this lenders, who will be able to renegotiate, under what terms and for how long. Until this does not come to fruition we are not certain how it will affect the market



New loans are hard to qualify for and are taking much longer than expected which in turn is causing homes to stay on the market for longer periods of time and escrows to take much longer than before and in some cases to even fall through. So even though rates are at a very attractive level right now, that means nothing unless you can qualify for one, and then actually get funded.



Most sellers are more sensitive to the conditions of the current market that what they were let's say one year ago, which in turn translates to more offers being accepted and more homes going into escrow. From our experience, generally speaking if a home is priced correctly and marketed correctly it will get sold, it is just taking longer.


Now, interestingly enough, for the first time in months I have found ourselves in multiple offer situations, it might have been a coincidence and it has not happened consistently enough for me to consider it a trend, but it is a start.


So in closing, we are in a challenging market but not everything is looking grim, and I actually do believe we are reaching a turning point.

In one of my next postings I will address specific areas and data to give you some facts and numbers.

If you have any specific areas of San Diego county you would like me to address please let me know and I will do so.


Best regards for now!