The prices of homes in San Diego County are the highest they have been in the last 6 years. It’s due to a combination of distressed sales continuing to fall, and mortgage rates reaching record lows.
According to DataQuick, a San Diego-based real estate monitoring site, the median price of houses sold in April rose to $400,000. This is a 21% increase from what it was exactly one year ago. Meanwhile, the rate of sales increased by 7% compared to what it was a year ago.
The numbers from the site also indicated that properties lost to foreclosure in the past year were at the lowest they have been in the last 6 years. Less than 10% of home sales were distressed homes such as foreclosures or short sales. January of 2009 was the peak of foreclosure sales where 55% of all homes sold that month were foreclosures. The median price was also $280,000.
Some analysts are worried these figures may trigger another housing bubble, but San Diego State University real estate economist Michael Lea says such fears are overblown.
The primary reason for continued hikes in the prices of homes is caused by a shift from a distressed market. This resulted to heavily discounted deals for buyers, and a decline in short sales. Short sales means that borrowers are selling their homes for less than what they owe.
All in all, the market is finally moving in the right direction. It’s nice to get back to a more normal market where we are helping buyers realize their dream of purchasing a home and dealing with regular sellers that are not facing foreclosure or having to consider a real estate short sale.
San Diego Real Estate Market Update – May 2013