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San Diego Real Estate Update – March 2019

The Buyers Go Marching One by One… Hurrah Hurrah

Last month we saw an impressively cold, rainy and even heaps of snow for the majority of the other housing markets across the nation. Even our So.Cal coastline was no exception as we faced weeks of frigid rain and braved the cold alongside the rest of America. Nevertheless, it is worth noting that the San Diego housing market has proven to be resilient despite predictions of a tougher year for the industry.

The Buyers Go Marching Two by Two… Hurrah Hurrah

It is still too early to say how the entire year will play out, – the overall condition remains fundamentally positive. Buyers have shown great determination toward achieving their homeownership goals.

The Buyers Go Marching Three by Three… The First-Timers Stop if Rates Rising…

While inventory is up for the sixth consecutive month, closed sales are actually down 14.8% with median sales price up only 2.8% since last year.  This emerging trend to moderation comes after years of price climbs and rising interest rates – though supply is finally on this rise, we are faced with the affordability dilemma as the number of buyers actually able to afford these homes is slowly declining. Though we did see buyers rushing back and ready to buy at the start of 2019. The total number of signed contracts jumped a shocking 4.6% between the end of last year and February 2019, according to the National Association of Realtors (NAR).

And They All Go Marching Down.. To Buy A House.. To Get Out of the Rain… Sales BOOM!

Most will point squarely to the drop in mortgage rates that occurred in December 2018 as a cause for this rebound and jump in buyer demand. Going forward, it is unlikely we will see such dramatic spikes like this one as supply levels are gaining – (still at about 3.5 months worth versus 6 months needed to be considered a balanced market). Income growth is stronger this year, but again we see the headwind issue as a large share of buyers are still on the edge of being able to afford a home.

Here’s what stats we saw last month:

So all-in-all, what does this mean for our San Diego housing market? Here’s what we see ahead – We can anticipate the spring housing market will see some signs of a rebound, but it will be slower than expectations compared to years prior. Due to affordability concerns with a large portion of the buyer pool, we can expect to see a disconnect between homebuyer demand and a slightly slower market this spring. Though supply is higher than it’s been in years, we lack entry-level homes and home builders have continued to focus instead on the move-up market. These structural headwinds will be a condition of our local and national housing markets for the rest of this year, and likely remain as a hot topic of economic concern for years ahead.

Buyers Advice:

As you may have picked up from this month’s market update, there are many recent buyer trends that seem to have clear cause-and-effect patterns – in the recent wake of growing affordability gaps, buyers are becoming increasingly sensitive and/or responsive to the ups & downs of F.ED. interest rates That said, they just lowered rates again to just under 4.4% in February.. *cue buying frenzy!* This is an opportune time for buyers to hit the softened market & make the most of this “pre-season” / calm before the home-buying storm! Take advantage of more inventory selection, less competition, more buying power & better chances in finding your perfect home (and potentially negotiate for a great deal, too!) If you’re looking to buy a home this year – Click to Search Homes!

Sellers Advice: ​​​​​​​

We’ve been finding many buyers lately who are out there actively searching these days seem to be primarily interested in buying homes that already look nice inside & out – Buyers are consistently searching for only these “Turn-Key” homes. However the majority of the homes on the market right now are NOT in the best of condition. We recommend folks put some money into their home to upgrade, renovate or repair (ONLY if cost to improve will serve to increase home’s assessed value, etc.) If you plan to offer your property as a buyers’ “Move-in Ready” or Turn-Key product, make sure you assess your overall presentation – buyers are getting picky these days so you want to stand out; look fresh, clean & tidy as best you can before listing. Quick tips for DIY listing prep: 1) simplify decor, 2) choose neutral tones & 3) De-Clutter, De-Clutter, De-Clutter!
Put your best foot forward when prepping your home for sale – Call today to learn more about our award-winning concierge home selling services, or click below to visit our website for more helpful seller tips and selling strategies… Click for Selling Tips

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