So whats going on with the Downtown real estate market? Is the bubble going to burst? Has it already? Well heres just a snapshot of whats recently been going on. In July of 2006, there were 48 sales in the 92101 area. Most condos were on the market for 92 days and the average asking price for a condo was $646,467, while the average sales price was $642,287 “ a 0.7% discount. July of 2007 sold almost 13% more condos, with 55 sales, but the average sales price dropped to $602,621 “ a 4% discount.
Now on to August.
In August of last year, Downtown San Diego had 38 condo sales. The average asking price was $634,090 and the average sales price was $608,085 “ thats 95.9% of the asking price. This last month, 36 condos were sold and the average sales price was $784,454! Thats 23.7% higher than last Augusts average sales price. On top of this, the average market time for sales last August was 80 days while August of 2007 only had an average of 62 days on the market.
So what does that say? Well not much. It just shows whats been happening recently, in the last few months. Statistics can be a great way to monitor the market and I do encourage you to do your homework. Be cautious however, to take things with a grain of slat “ not all statistics are what they seem. For example, you might hear that sales in a particular area are up 50% in one month, but that could mean that instead of 10 sales, they had 15. Yes thats a 50% increase, but does that really mean anything?
Figuring out where the exact bottom of the market is, is pretty much impossibleno matter who you are. My guess is that prices will be level for the next year, to two yearsbut who knows. If youre looking to make a quick buck, then dont buy “ unless you find a GREAT deal. If you are looking to start a family, or find the home of your dream and are planning on staying put for 3, 5, 10 years, then why not buy? Do you really think that possibly saving $10“30K on a $700,000 home will really make a difference in the long run?
What people have lost sight of, is the fact that owning a home is not a right, especially in San Diego. Home ownership is a privilege and its not just about making money. Obviously its a financial investment, but keep in mind the other benefits “ like the memories youll make raising your family there, or that your rent will no longer be going into someone elses pocket, or simply the fact that youll finally owning your own home. Whatever the reasons are, just make sure you dont miss out on that perfect home, because you were waiting for the perfect time to buy.