In San Diego Homes sales we are still seeing extreme localized markets as well as major differences in level of activity within different price points.  Downtown and much of the metro area we continue to see a number of foreclosures and a domination by short sale listings.  The lower price range ($400k and lower) is still hot with multiple offers and shorter marketing times.  The higher price ranges ($800k and higher) are moving extremely slow and deals are to be had on the short sale listings if you are willing to wait it out.  In inland North County, many of the homes priced in the mid-$500s and lower are also flying off the shelves.  Condos priced in the mid-$300s and lower are also hot, hot, hot.  But the higher end product, $700k+ is a much slower paced market.  In the always desireable but high priced areas along the coast, like Del Mar and Solana Beach (average sale price of $2.2MM over the last 3 months) the inventory movement is slow as with most any high end market and tracking at about a 14 month absorption projection.  Ever popular Carmel Valley (just inland from Del Mar),  we are seeing a$950k+ average sale price over the last 3 months and a very fast absorption projection of less than 8 months.  Average days on market for sold listings is 60 days!  So this market is definitely simmering in the summer months.  Moving south to desireable Eastlake area of Chula Vista (where foreclosures are pretty prevalent and pricing was hit hard in the decline), the detached home market is hot due to the low average sales pricing of $409,000.  With just over 370 active/contingent listings this market is tracking at about a 3 to 4 month absorption rate!  This is a solid indicator of a strong market that is producing competition among buyers.

As can be seen by the MLS numbers, many localized markets are strong here in San Diego.  We are starting to see some appreciation in pricing in a few of the lower end markets.   Although slight, it is an indicator that we seen and passed the bottom of the market in these localized markets.

In San Diego Homes sale trends we are still seeing extreme localized markets and major activity differences amongst price points.  Throughout San Diego we continue to see a number of foreclosures and a domination by short sale listings.  In downtown condos, the lower price range ($400k and lower) is still hot with multiple offers and shorter marketing times.  The higher price ranges ($800k and higher) are moving extremely slow and deals are to be had on the short sale listings if you are willing to wait it out.  In Inland North County, homes priced in the mid-$500s or lower seem to be flying off the shelves.  Condos priced in the mid-$300s down are also hot, hot, hot.  But the higher end detached property, $700k+ is seeing a much slower paced market.  In the desireable but high priced areas along the coast, like Del Mar and Solana Beach (average sale price of $2.2MM over the last 3 months) we see slow movement as with most high end markets and about a 14 month absorption projection.  Ever popular Carmel Valley (just inland from Del Mar),  is showing a$950k+ average sale price over the last 3 months and a  respectable absorption projection of less than 8 months and average market time for sold listings is 60 days!  So this market is definitely simmering in the summer months.  Moving south to newer Eastlake in Chula Vista (where foreclosures are pretty prevalent and pricing was hit hard in the decline), the detached home market is flying of the shelves.  With less than 380 active/contingent listings the market absorption rate is at less than 3 months!  The condo market is also hot here.

The synopsis…  the inventory is selling.  And throughout most of San Diego we are seeing list/sale price ratios of upwards of 95%.  Meaning low balling is not the norm out there.  Some of the most competitive localized markets are starting to see the remnants of slight appreciation.  This is occurring mostly in the lower price ranges as many first-time home buyers that were waiting in the wings are jumping into the market. 

A new state law, that was passed back in February, took effect on Monday June 15th.  The state of California is imposing a 90-day moritorium on housing foreclosures that is intended to make lenders try harder to keep borrowers in their homes.  Loan companies supposedly must prove that they made an attempt to modify before foreclosing.  However, most of the big lenders likely have a program in place and can apply for an exemption. 

So it is unclear as to how many homeowners will actuall benefit from the new law.  But it will likely push the smaller lenders to fall in line and work more diligently with their delinquent borrowers.

Moratorium Guidelines:

• Applies to first mortgages from 2003 to 2007
• The loan must be on your principal residence
• Borrower must have received a notice of default
• Current loan servicer does not have a modification program in place

This may or may not have a significant effect on the San Diego Real Estate market availability as far as foreclosed properties coming on the market.  I feel that the extra cost that banks must incur is more of a deterrent to foreclosure than the state mandated moratorium.  It is often in the bank’s best interest to offload the property rather than spending $50,000+ to hire a trustee and foreclose.

And we’re not in a buyer’s market in San Diego Real Estate.  We’re also not in a seller’s market.  We’re in a bank-ruled market.  Now, the banks aren’t the winners here. Don’t get me wrong.  Even if a bank forecloses, they will be out thousands and thousands of dollars due to the overly inflated prices of 2004-2006.  In fact, most banks have adopted a moratorium (fancy word for “suspension of activity”) on foreclosures because it typically costs them $50,000+ to hire a trustee and foreclose.  So, that means banks will be working harder to get short sales negotiated favorably.  But still, short sale negotiators are ordering BPOs (Broker Price Opinion = Appraisal) and demanding they bring in the appraisal price and often require someone (buyer, seller, agents) to throw in additional monies towards back HOA dues and other expenses.  So, people, we are in a BANK-RULED market where terms and pricing is being brought outside the negotiating power of agents.    As agents, we need to be aggressive and fight for our clients irregardless of whether we’re representing buyer or seller. 

As I always say, the good news is that pricing is so much lower in today’s market.  BUT, there are price points where we are seeing some appreciating (take a look at the $400k and lower markets in any desireable location) and in those markets its because of multiple offers and buyers fighting to get into escrow on a property.  We’ve seen and passed bottom folks.  Its go time.

Tara