Oceanside Real Estate Weblog

San Diego County Economic Profile June 2008

Lies! Damn lies and statistics as Mark Twain once exclaimed. Now with the California Association of Realtors June 2008 Economic profile you too can be an expert when you opine about our economic future.

These statistics reveal the strength and weakness in a wide range of economic data related to the real estate market, employment and population trends in the San Diego economy.

sandiego0608.pdf

Most interesting trends are the increase in foreclosures, the decrease in median prices listed by city, the dramatic increase in sales and which segments of the market have the most activity. Please keep in mind that median price decreases are being driven by foreclosures which account for 25% of total sales mostly in the lower priced segments of the market while sales have dropped off in the upper priced segments. This shift in activity has a tendency to make median price decreases more dramatic. Investors are buying heavily into the lower priced homes. Tremendous opportunities exist in North San Diego County Coastal cities like Oceanside, Carlsbad and Encinitas.

Damn lies and statistics! As I’ve mentioned before, all of the statistics regarding unsold inventory are squewed by the number of short sales that are listed in the inventory. Most short sales are unsellable because lenders can’t or won’t meet the terms a potential buyers offer, which bloats the inventory numbers. Buyers find themselves competing with investors, multiple offers, overbids and transactions that don’t close.

More damn lies and statistics…Some areas are showing a 20% year to date decrease in median price. However, for those who are financing their purchase mortgage rates have gone up 20% in recent weeks from 5.3% to 6.3%. So keep an eye on mortgage rates. They can easily erase any savings to be had by lower prices.

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Bear Stearns’ Bailout numbers are huge….really huge.

If you are like most of us the recent bail out of Bear Stearns’ was just a passing blip in the never ending river of talking head blather and hype… most of it BS… about real estate, finance and investing. However, a closer look at the magnitude of exposure Bear Stearns’ has in derivatives gives us a prospective about why the bailout was necessary. My mentor and associate Pat Kitano has a great article about this mega event and what it really means.

So with all the hype going on about real estate slumping, tanking and all that in the Oceanside Carlsbad, Vista, San Marcos and Encinitas areas some people actually believe that sellers will be paying buyers to take their property, perhaps giving them a monthly stipend, or arranging a marriage with their daughters and mowing the yard for them until 2020. REALITY CHECK…there are some great buys to be found but don’t miss the boat. According to HomeDex median prices in the North San Diego County Coastal area actually increased about 5% in April. There are homes on the market in the North San Diego County and many other economically stable areas that couldn’t be built for their current asking price. According to some, so called, authorities we are 75% through the sub-prime fiasco. So what! Prices are down, interest rates are low, inflation is rising and what better asset to own than Real Estate? Real Estate is personal shelter, tax shelter, it doesn’t evaporate like a stock can, you can live in it , rent it, insure it so if it burns to the ground it can be rebuilt and underneath is the land value. Real Estate is a tangible asset, not a piece of paper like a Bear Stearns’ derivative.

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Spring Bounce Is Trying To Blossom.

Will things pick up in North San Diego County Real Estate for the up coming spring season? There are some good indications that we will see some increased activity soon. First, interest rates are still near historic lows. Also, normal sellers have been noticeably absent from the winter market. Many listings are foreclosures or short sales. The average seller is gun shy about having to compete with these give away offerings. Soon pent up demand both to sell and buy will have to give way. Expect some good action soon. That’s my call.

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North San Diego Home Prices For Jan. 2008 And 12 Month Report 02/14/2008

The following information was reported from HomeDex for the month of January 2008.

· The median price for all homes in North San Diego County – single-family
detached and single- family attached – declined to $480,000 in January 2008 from
$485,000 in December 2007.

· The median-priced single-family detached (SFD) home in North San Diego
County decreased 1.14 percent to $562,500 in January 2008 from $569,000 in
December 2007. SFD median prices in Non-North County zip codes decreased
5.86 percent from $450,000 in December 2007 to $423,650 in January 2008.

· Median SFD prices in North San Diego County fell 10 percent from
$625,000 January 2007 to January 2008.

The median price fell 18.05 percent in Non-North County from $516,938 from January 2007 to January 2008.

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