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San Diego: Home Sale Price Increase Leveling off

Posted on June 12, 2014 | Leave a comment

Home prices in San Diego County climbed in May but at less than half the pace they did a year earlier.

Last month, the median price for a home sold in the county was $440,000, a nearly seven year high that is up 8.2 percent from $406,500 in May 2013, real estate tracker DataQuick reported Wednesday. However, that appreciation rate pales in comparison to the 21.3 percent gains seen from May 2012 to May 2013, the midst of the housing recovery. The county is now on the brink of hitting its lowest year-over-year appreciation in home prices since 7.9 percent in August 2012.

“The sort of price spikes we saw this time last year – annual gains of 20 percent or more – are less likely today given affordability constraints, higher inventory and the drop-off in investor purchases,” DataQuick analyst Andrew LePage said in a statement.

The higher median prices are also dampening sales. In May, 3,654 transactions closed, 10 fewer than in April. Typically, activity jumps in the spring and summer months, which are considered peak buying season. In May 2013, there were 4,236 transactions, 444 more than in April 2013.

“This year just isn’t rolling as fast, things are leveling off,” said Mark Goldman, a loan officer and real-estate lecturer at San Diego State University. “We’re entering into a period of a stable market that’s experiencing some sort of equilibrium. There are no particular forces that are creating incentives for sellers to sell or buyers to buy.”

Interest rates are still low — the average in May for a 30-year fixed was 4.19 percent — but Goldman noted that household incomes are flat, which hurts affordability. Inventory, still low by historical standards, hit 7,000 active listings in May for the first time since March 2012, the San Diego Association of Realtors reported separately.

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San Diego is Second Least Affordable for Homebuyers

Posted on June 11, 2014 | Leave a comment

A San Diegan has to earn nearly double the county’s median income to afford a median-priced home here, says a study released this week by mortgage information company HSH.

The findings make San Diego the nation’s second-least-affordable city for buying a home behind San Francisco. The report says a person in San Diego would need to earn $98,534 a year to buy a $483,000 home, the county’s median price in the first quarter.

“It’s a very expensive part of the world to live in,” said Keith Gumbinger, vice president of HSH. “It’s a matter of compromise and adjusting your expectations and looking for things that fit your budget.”

The median household income in the county for an individual is $50,900, according to the U.S. Department of Housing and Urban Development. For its price calculation, HSH assumed a 20 percent down payment, 28 percent debt-to-income ratio, a 4.56 percent mortgage rate and included insurance costs and property taxes.

Gumbinger noted that the median price is the middle point of all homes sold, meaning that half of the transactions in the first quarter were below $483,000. Still, home prices rose 17 percent over the past year, which priced out the typical middle-class family of four that would want a three-bedroom, two-bathroom house.

“The thing that’s getting scary is you used to be able to buy for between $225,000 and $285,000,” said K.J. Koljonen, associate vice president of the nonprofit Community HousingWorks. “It’s almost not there anymore. The amount of houses that are at or under $250,000 has gone down by a ton.”

In April, the number of homes for sale for $250,000 or less in San Diego County was down 54 percent in the past year, the San Diego Association of Realtors reports.

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San Diego Home Prices Grow at a Slower Rate

Posted on May 28, 2014 | Leave a comment

Home prices in San Diego County reached a post-Great Recession high in March, but are still slowing on an annual basis.

The S&P/Case-Shiller Index showed Tuesday that prices rose 1.3 percent from February to March. In the previous Case-Shiller report, San Diego County led the nation’s appreciation at 1 percent.

Still, San Diego County’s monthly upticks have not been enough to sustain big annual appreciation driven by the investor-related homebuying that dominated the first half of 2013. The index, which measures repeat sales of single-family homes, measured 199.6 in March, its eighth consecutive month in the 190-range after starting 2013 at 163.28.

“We’re hitting the upper numbers in terms of a recovery but we’re also hitting the limit in terms of affordability,” said Mark Goldman, a loan officer and real-estate lecturer at San Diego State University. Goldman said he sees annual gains on the index slowing to around 5 percent by the end of 2014 because of low inventory, flat household incomes and difficulty in qualifying for a mortgage, which currently offer historically low rates.

Disclaimer: for information and entertainment purposes only

San Diego: Home Sale Price Increase Leveling off

San Diego is Second Least Affordable for Homebuyers

San Diego Home Prices Grow at a Slower Rate

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