San Diego Real Estate Blog

Monday, 01 March 2010

San Diego Real Estate Continues Improvement

Happy March 1! 2010 is moving very quickly.

Our local real estate market continues to show strength, especially in the lower price ranges with multiple above list price offers being written. I had 11 offers on a recent listing, 9 of them all cash from investors. The frustrating part is that families trying to buy their first home have had limited success due to the competition they face from those all cash paying buyers. That also makes it impossible for them to take advantage of the home buyer's tax credit program which only runs until the end of April.

As of today there are a total of 5,672 detached homes on the market for sale. During February 1,935 opened new escrows (some were new equity sales and others were short sales that received lender approval and moved from "contingent" to "pending"). This means we have a 2.9 month supply of detached homes, a seller's market with rising prices. If you add in the number of short sales that are awaiting lender approval another 2,472 homes went off the market that reduces the supply to 0.78 months. Turnover is slower the higher we go up in price.

There are now 2,896 attached (condo) homes on the market and 1,005 of those opened new escrows last month, giving us a 2.9 month supply in this category. Another 1,981 short sales went contingent last month giving us a total of 2,986 units with accepted offers, a cumulative 0.68 months of supply. This is an indicator of a strong market with rising prices.

As I have often said, real estate is a highly local situation. Certain markets in San Diego are stronger than others, just like San Diego might be weaker or stronger than other parts of the country. Additionally, running the statistics for various price bands also shows more specific data. Typically when a client is interested in buying a home we will run the sales data for his very specific criteria to give them the most accurate picture possible.

The link to the article below highlights the improving San Diego economy.

http://home.sandiego.edu/~agin/usdlei/

San Diego leading indicators improving

Let me know what questions you have...

POSTED BY: Rick Ungar AT 04:09 pm | Permalink | E-mail this

Friday, 19 February 2010

San Diego Mid-February Real Estate Update

Just wanted to share the following links to articles about our local real estate market that I've seen over the last few weeks. I think they give a good third party perspective on the state of our local market (which may be better or worse than other market areas).

Also, if you live in the San Diego area feel free to visit the link in my signature below that leads to a SmartPhone MLS app that gives you access to all properties on the market here.

http://www.sddt.com/Finance/article.cfm?SourceCode=20100202czq

Fewest January foreclosures since 2007

http://www.sddt.com/Commentary/article.cfm?Commentary_ID=200&SourceCode=20100204tzc

Downtown condos rebounding

http://www.sddt.com/Finance/article.cfm?SourceCode=20100211cza

San Diego’s leading indicators improve

http://www.sddt.com/Finance/article.cfm?SourceCode=20100211czh

San Diego prices and sales down in January

http://www.signonsandiego.com/news/2010/feb/12/a-positive-outlook-for-san-diegos-economy/

Positive outlook for San Diego’s economy

http://www.latimes.com/classified/realestate/news/la-fi-harney14-2010feb14,0,2696302.story

Home equity again on the rise

Enjoy the rest of the month!

POSTED BY: Rick Ungar AT 10:00 am | Permalink | E-mail this

Tuesday, 02 February 2010

San Diego Real Estate Update (2-1-10)

As is my custom what follows is my take on the local real estate market. Keep in mind that I stress the "local" part as all local markets are different and react to many unique factors. When you read that the real estate market is "soft" or "hot" on a national level that is like saying the average temperature is 70 degrees and to imply from that the temperature everywhere is 70. Sometimes our market is better, sometimes worse than others.

It looks like our local market is still strong. As of today there are 5,339 detached homes available on the market. 1,562 went into escrows during January and another 2,350 went "contingent" (short sales awaiting lender approval) during the month. Using just the new escrow number we have a 3.42 month supply of detached homes on the market. A supply of less than 4 months is normally considered a moderately strong market with prices on the upswing. If you add the 2,350 new contingent listings to the new escrows we come up with a supply of 1.36 months.

The attached (condo) market shows 2,591 units now on the market with 839 opening new escrows and another 1,874 going into the "contingent" status. The new escrow index shows a supply of 3.09 months and 0.96 months when we add the "contingent" listings. Both are strong with prices starting to increase. Multiple offers are still common in the lower price range with sales occurring above the listed price in many cases.

Activity is slower in the higher price ranges with longer on market times being common, due at least in part to tougher financing requirements that make it difficult for move-up buyers to make aggressive moves.

The links below take you to several articles talking about the market in general saying that the number of foreclosures is up but the number of new defaults is down. I personally think that we have seen the majority of the lower priced foreclosures over the last few years but that we should see more short sales in higher price ranges for the next few years. I also think lenders may be more forgiving on those higher priced short sales to avoid taking them back in a foreclosure and incurring an even larger loss.

Enjoy the articles and the perspectives presented by their authors...

http://www.signonsandiego.com/news/2010/jan/27/housing-prices-buck-trend/

SD Home Prices Buck Trend

http://online.wsj.com/public/resources/documents/retro-HAGERTY.html?mod=djemRealEstate

Housing Chart

http://online.wsj.com/article/SB10001424052748704905604575027370647347644.html

National Housing Trends

http://ow.ly/11QLh

California Defaults Slow, Short Sales Increase

Let me know what questions you have. I'm always available to help!

POSTED BY: Rick Ungar AT 03:48 pm | Permalink | E-mail this

Tuesday, 05 January 2010

San Diego Year-End Real Estate Update (1-3-10)

Happy 2010 to everyone! 2009 was a year unlike many others, hopefully 2010 will be better for all of us.

On the real estate front in San Diego sales improved over 2008 due to low interest rates and prices as well as the homebuyer tax credit. Keep in mind that in order to take advantage of the tax credit this year a home purchase must be under contract by April 30, 2010 and closed by June 30, 2010. 11,730 attached homes changed hands during the year compared to 10,006 in 2008, an improvement of about 17%. 22,156 detached homes transacted in 2009 compared to 19,100 in 2008, an improvement of about 16%.

Prices in the lower levels have been increasing and it is my belief that the majority of the foreclosure activity has been completed for these homes. Prices in the middle and upper ranges continue to be softer but are improving, especially in the better areas. Jumbo loans are getting somewhat better and that will increase the move-up activity as they become even more attractive. It is felt by many that we could see larger numbers of short sales in higher price levels due to the number of option ARM loans resetting over the next few years.

It is still my feeling that people who purchase over the next year or so will be very happy when they look back on things a few years later.

The links below will take you to a few articles that will further explain our local real estate market:

http://www.signonsandiego.com/news/2010/jan/03/housing-picture-not-all-gloomy/

Housing picture not all gloomy

http://www.signonsandiego.com/news/2009/dec/30/county-housing-index-up-again/

County housing index up again

Let's all have a great and healthy 2010!

POSTED BY: Rick Ungar AT 01:58 pm | Permalink | E-mail this

Tuesday, 01 December 2009

San Diego Real Estate Update (12-1-09)

I hope everyone had a great Thanksgiving. We had about 20 at our home, all of whom went home with a large supply of left-overs and a few extra pounds to shed.

As most of you know, the report I send on the first of each month is more statistical in nature than the mid-month report that is primarily articles I have saved over the last month or so.

Currently, in San Diego county there are a total of 5,395 detached homes on the market which is 117 homes less than in October. 1,549 new escrows were opened last month compared to 1,854 the month prior and 2,424 homes went "contingent", meaning that they were likely short sales that have offers awaiting lender acceptance. This means that 3,973 detached homes went off the market due to contracts during November and that we have about a 3 week supply of available detached homes. This indicates a seller's market with prices on the rise. Much of this activity was in the lower price ranges due to the better financing options and the number of first time buyers entering the market. Things are more difficult for move-up buyers because of the difficulty with jumbo loans.

Today there are 2,458 attached (condo) properties on the market, up by 23 from last month. 898 new escrows opened compared to 965 the month before plus another 1,938 went contingent meaning that a total of 2,836 attached properties left the market due to contracts in the last month, giving us about a 3 week supply of active listings. This is also an indicator of a strong market with prices on the upswing, especially in the lower ranges.

Interest rates continue to be at extremely low levels, the home buyer tax credit has been extended and expanded, and there is good financing at the lower prices plus there has been little to indicate that the inventory level will increase any time soon as there is uncertainty about when the next group of foreclosures will hit the market and what price range they are expected to involve.

I just activated a very interesting service for those of you in San Diego that will allow you to use your smart phone to see every home that is on the market around your current location by using the GPS function. This is free to you and can be downloaded by clicking on the "smarter agent" link below.

Here is a link to a new article I saved plus the app I just mentioned...

http://rismedia.com/2009-11-24/house-prices-increase-slightly-in-third-quarter-2009-first-quarterly-increase-since-second-quarter-2007/

Prices up slightly

http://mobile.smarteragent.com/casabellarealty/

Mobile MLS search from your cell phone (San Diego only)

Let me know what questions you might have.

POSTED BY: Rick Ungar AT 12:15 pm | Permalink | E-mail this

Sunday, 01 November 2009

San Diego Real Estate Update (11-1-09)

Happy day after Halloween! I hope not too many of you are in sugar shock from all the left-over candy. This was the second straight year where we only had 1 group visit my home, probably because there were so many organized events in advance.

The San Diego real estate market continues the same patterns we have seen for some time now. Our total inventory of available detached and attached homes now stands at 7,947 units on the market unsold. This total represents about half of our normal selection and much of it consists of newer short sales that could take months to process and are therefore not as attractive to buyers as either equity sales or bank owned properties, both of which offer a much faster trip through the escrow period.

On the detached home front, 5,512 homes are on the market as of today. 1,854 units opened new escrows last month and another 2,328 went "contingent" (short sales with accepted offers awaiting lender approval) during the month. The total of 4,182 new pendings and contingents means that we have about a 3 week supply of inventory and that prices are starting to increase. Offers must be aggressive and pre-approved to have a fighting chance, with up to 30 bids competing on many listings. I have begun to limit my real estate practice to showing only equity sales, bank owned properties or approved short sales because the frustration level experienced by all parties is tainting the home buying process.

On the attached property front, 2,435 units are on the market today. 965 went into new escrows over the past month and another 1,956 went "contingent" over the same period, meaning that 2,921 units went off the market which is about 20% more than we have available. This obviously creates difficult bidding situations and rising prices.

I am often asked by buyers what they can do to win a bidding war so we've created the list of suggestions below. Keep in mind we do not recommend any of these steps unless you are fully aware of the possible consequences.

Possible Options in

Multiple Offer Situations

(Not encouraged by this firm without full understanding in advance)

Bid very aggressively on the price, at the top of your loan qualification or comfort level. In a strong seller’s market where inventory is low this could mean 10% or more above the listed price.
Pay all cash or use a conventional loan with 20% or more down. FHA & VA loans are difficult due to the small down payments and loan requirements on sellers.
Make a large good faith deposit (up to 3% of the purchase price).
Do not ask for seller concessions.
Request a closing less than 30 days away and offer to pay a per diem charge if you are late, or be prepared to accept one that the seller counters with.
Offer to buy the property as is, without repairs if possible.
Eliminate the appraisal contingency.
Provide proof of the funds needed to close with the offer.
Provide a loan pre-approval based on your credit report.
Offer to remove contingencies in less than 17 days.
Offer to pay for your own home warranty.
Offer to pay some of all of the seller’s closing costs.
Be prepared to walk away from out-of-pocket expenses for inspections and appraisals.

Many of these options involve risk on your part. Do not pursue any of them until you have a full understanding of the possible consequences you could face.

It looks like the tax credit will probably be extended and possibly expanded to include non-first time buyers over the next few weeks. Unfortunately, at least in San Diego, it has been very tough for first time buyers to take advantage of the credit due to the difficulty experienced in winning a bid.

I hope this helps and look forward to hearing from you soon...

POSTED BY: Rick Ungar AT 12:01 pm | Permalink | E-mail this

Thursday, 01 October 2009

San Diego real estate market update (10-1-09)

The San Diego real estate market continues to be especially crazy in the lower price ranges while the higher ones languish until better financing options become available in the jumbo market.

Here are a few of my thoughts:

Current overall inventory of attached and detached homes (excluding land & mobiles) stands at 7,870 units, about 50% of the "normal" amount available.
5,449 detached homes are now on the market. During the last 30 days 2,117 went into new escrows and another 2,295 went "contingent" (short sales or bank owned properties with accepted offers awaiting approval from the lender(s). This means that a total of 4,412 detached properties went off the market in September. Dividing the total inventory of 5,449 by 4,412 means that we have a 1.24 month supply of detached homes. This means prices are rising. In my personal experience recently we have found ourselves competing with up to 25 buyers on the better properties. Buyers are often making insanely high offers hoping they can renegotiate the price if the appraisal comes in low but in many cases are finding the sellers refusing to accept appraisal contingencies or to lower prices.
2,421 attached properties are now on the market. 1,108 attached properties went into new escrows last month and 1,955 went "contingent". Combining these two numbers yields a 0.8 month supply of attached homes, obviously a seller's market with prices on the rise.
Combining detached with attached homes shows us a total inventory of 7,870 properties with a total of 7,475 properties go pending and contingent, yielding a 1.05 month turnover rate for the overall market.

What does this mean? Simply put, buyers must be very aggressive both in terms of price and timing. Offers below the listed price often stand little chance and those asking for a longer closing period or other concessions are at a disadvantage. Unfortunately, FHA and VA buyers are also suffering as sellers lean towards offers with more cash invested and fewer demands by the agencies. Buyers can often expect to make offers on multiple properties at the top of their financial abilities. I have been advising my clients in many cases to lower their search price maximum so they can afford to overbid for a property and stay within their loan pre-approval limits. Low ball offers typically draw no response from sellers and it is a mistake to assume that San Diego real estate is the same as real estate in the rust belt. While it is true we have our own regional economic issues it is also true that real estate is highly local. It is not accurate to say that the average temperature is 75 degrees everywhere in the U.S. nor is it safe to say that real estate in depressed areas is the same as it is here. Our relative lack of buildable bulk land should contribute to the shortage of supply over the upcoming years.

In my almost 40 years in this business I have never seen such a complex or competitive marketplace and have never worked so hard with so much stress on the part of myself and my clients. Bottom line, this is an OUTSTANDING time, in my opinion, to make a real estate purchase that should look very good in a few years. Prices and interest rates will not stay this low forever so we should not less this opportunity pass.

POSTED BY: Rick Ungar AT 02:47 pm | Permalink | E-mail this

Sunday, 20 September 2009

San Diego mid-month market update (9-18-09)

Welcome to all the new subscribers to our monthly market report. It is always our goal to provide unbiased, professional input on what is happening in the San Diego real estate market and to use the expertise of others to give a well-rounded view. As we all know, the real estate market is not like the stock market, i.e. we can't watch prices on a ticker!

I just checked our local Multiple Listing Service and found that our current inventory level is less than 50% of what it was a year ago and is normally. Right now we have 6,375 detached homes on the market plus 2,602 attached properties (condos, townhomes, etc.). During the last 30 days 2,069 detached homes opened new escrows, so when dividing that number by the total inventory we see about a 3 month supply of homes which puts the market into the seller's favor with prices starting to rise. In addition to those that went into escrow 2,396 detached homes went "contingent", which means they were either short sales or bank owned properties that are awaiting lender approval. Combining those 2 numbers means that over 4,300 of the 6,375 homes on the market went under contract! This means that there was a 1.5 month supply and explains the ultra competitive bidding that is occurring with 20-40 offers happening on many properties.

In the attached home market there are now 2,602 units on the market. Over the last 30 days 1,155 opened new escrows and 1,905 went "contingent", meaning that over 3,000 units went under or are awaiting lender approval. This is less than a 1 month supply!

This has been an extremely frustrating market for buyers and agents alike for the following reasons:

Prices are being forced up and out of the range of many first time buyers.
The difficulty in winning a bid makes it nearly impossible for first time buyers to secure the $8,000 tax credit that expires 11/30/09.
Appraisals are tricky as appraisers compare new sales to older ones at lower prices. This is a classic shifting market issue that has been exacerbated by the new appraisal rules that are so complicated that an 6 page rule now must have an 8 page Q&A attached to explain it!
We are advising many buyers to set their maximum price in searches about 10% below their purchasing power to allow for over bids.

Following are several links to articles that I noticed during the last few weeks:

http://www3.signonsandiego.com/stories/2009/sep/06/dont-be-among-victims-foreclosure-prevention-scams/?uniontrib

Foreclosure scam warning

http://www3.signonsandiego.com/stories/2009/sep/06/new-rules-home-appraisals-under-fire/?metro&zIndex=161384

Appraisal issues after new regulations

http://www.sacbee.com/topstories/story/2163510.html?ref=patrick.net

Loan mod backlash toward banks

http://rereport.com/sdc/print/SDCNCCRick&RickiUngar.pdf

San Diego Real Estate Report 9-12-09

http://www3.signonsandiego.com/stories/2009/sep/15/housing-prices-county-rise-sales-down/?uniontrib

Prices up, sales down

POSTED BY: Rick Ungar AT 09:08 am | Permalink | E-mail this

Rick Ungar is a Certified Distressed Property Expert, solving the foreclosure issue one homeowner at a time. Contact us today to learn about the best options to preserve your credit and buy again soon.

No pain home sale - click here to find out more