In Q1 of 2010, the average sales price per square foot at The Grande condos was $476.54…20% lower than Q1 of 2009($595/sqft).  The Grande had eight condos sales in Q1 of 2009 as well, but the average sales price was much higher, at $894,363 – two were REOs and one was a short sale.

Going back to 2008, The Grande had 15 sales in the first quarter, with an average sales price of $884,066 – which was 8.4% lower than 2007’s Q1 average.  Downtown San Diego condos prices have steadily come down over the last four years, despite increased activity…primarily a result of the growing number of short sales and foreclosures.

With 37 active listings, 6 contingent deals, 3 that are in escrow and 13 sales YTD, The Grande seems to be doing well.  There aren’t as many deals anymore and higher end condos are being purchased.  In 2008, The Grande had 19 sales in the second half of the year, a number that isn’t far off from where we’re at today.  Now that the home buyer tax credits are out of the way, it will be interesting to see if activity slows down.

If you have any questions about San Diego real estate, please contact me at 858–243–2092 or denny@sandiegoh.com. Thanks.

Denny Oh

*Note that the “high” and “low” statistics in the charts above are not necessarily for the same units – they are the highs and lows for the sales in the building during that time period.  Thanks Damon.

In 2009, there were 808 condo sales in downtown San Diego – almost 19% more than the amount sold in 2008.  In my opinion this was due to two factors: A) Prices were lower than the year before and B) People were more confident that the “bottom” had been reach, or at least it was close. As you can see in the chart below, month-to-month, 2009’s condo prices were on average, 17% below 2008’s sales prices(and yes, I know you can’t take an average of an average, but you get the idea).

At the peak of the market in 2005, there were 846 condo sales in 92101.  The average sales price then was $686,991 versus 2009’s $462,710 – almost 33% below 2005’s average downtown San Diego sales price.  However, due to the low prices, there were 808 condos sold in 2009, which was almost 19% more sales than in 2008.  The entry level market for downtown San Diego was extremely competitive.  Anything below about $300K was going quickly, while the $1.5M plus range was still pretty quiet.  Still, buyers at all price points were looking for deals and may had the cash to do it.  Once again, the summer months were the busiest with 97 sales in the month of July.  Surprisingly, we saw 97 more condos sold in the month of October – perhaps driven by people’s desire to get into something before the holidays.

With most downtown San Diego condos selling in about two months, even with all the short sales and foreclosures, 2009 turned out to be a pretty decent year – unless you were selling.  Many people discovered that they could actually afford downtown living since prices and interest rates were low – something that to my knowledge hasn’t ever happened in San Diego.  Downtown San Diego even saw a condo sell for $6,160,000! Now if this person spent that much money on a condo in downtown San Diego, maybe people should reconsider whether or not buying real estate in San Diego right now is a bad idea – I’m guessing this person might know a little bit about investing.

No one knows exactly what will happen to the real estate market this year, or the next, but what we do know is that interest rates must go up.  And when they do, I hope you can be happy you already bought and not complaining that the $500K home you could have afforded is now actually a $425K home (based on 20% down and a rate increase from 5.25% to 6.75%).  So with that said, good luck!  If you would like to talk about purchasing a home in the San Diego area, please contact Denny Oh at 858–243–2092 or denny@sandiegoh.com.  And if you are thinking about selling, it might be better to do it now and take advantage of the buy side than waiting.

*All statistics are based on Sandicor’s MLS.  Many of the “new construction” statistics are not listed in the MLS, therefore not in these numbers.

Real estate prices in downtown San Diego are back to what they were in 2001 and 2002!  With an average sales price of $461,752 in 2009, downtown San Diego condos are 35% less expensive as they were in 2004.  Downtown San Diego condos have not been this “cheap” since 2001!  Keep in mind however, that these numbers a bit skewed, as not all developer sales are represented in these charts(I didn’t have that info). Inventory is low and there’s nothing currently under construction.  What we have now is what we’ll have for at least the next two years(which is about how long it’d take to finish a building if they broke ground today).  Bosa is starting their third tower in San Francisco and I think Bayside will keep their hands full for a while.  My guess is that we won’t see any new condos being started for about 18 months.

I’ve noticed a huge upswing in buyers’ confidence levels and we’re seeing a lot of investors taking advantage of the market.  Yesterday, I was at a Trustee sale on the court house steps and even those(you have to pay cash here – no loans) are busier now(in terms of how many people attend).  In 2009, there were 788 condos that sold in the MLS in downtown San Diego alone.  This does not show all of the developer sales, although there weren’t a ton.  Only 2005 had more condo sales, which was the peak of the market and had 846 sales – only 58 more sales. 

I think most people will tell you that there seeing a lot more activity in the real estate market.  Despite the longer market times that banks are creating(short sales typically take 4–8 months), a lot of homes are selling in the 92101 area.  As you can see below, market times are about 9–16% shorter than they were in recent years and with the new “stream lined” short sale process, hopefully we’ll see even faster transactions.

If you’re thinking about buying, or selling, a home in the San Diego area, please let me know.  I may not have any bus stop ads, but I think that I’m pretty good at what I do.

Click here to see great San Diego real estate deals

Click here to see more downtown San Diego sales statistics.

So far in 2009, there have been a total of 9 condos priced over $1.5 million that have sold in downtown San Diego(at least that’s what the MLS shows).  As you can see below, these 9 sales had an average sales price of $2,277,443 and sold for an average of 94.2% of the asking price.  These numbers are somewhat skewed though, because four of the condominiums were sold prior to being entered in the MLS and were only inputted for comps.  These four condos were also all in the new Sapphire Tower highrise.

All of these sales were in a few buildings – Sapphire Tower, The Grande, Electra and The Pinnacle…some of the San Diego’s best highrises.  Looking at the same time period, only a year earlier, 16 condos sold in the downtown San Diego market and had an average sales price of $1,975,525. This equates to a 15% increase in price for 2009, but a 44% decrease in activity.  The sales were also more spread out in 2008, with sales in buildings like the Meridian, Cityfront Terrace, the Metropolitan, Harbor Club, Renaissance and Horizions(The Grande, Pinnacle and Electra were also represented).

In 2008, there were a total of 25 sales in downtown San Diego, all of which sold for $1.5 million or more.  I don’t see that happening this year, but who knows…maybe some of you will figure out how many great deals are out there and want to take advantage of the market.  Let me know if there’s anything I can do for you…

Denny Oh 858-243-2092 denny@sandiegoh.com

With 5 condo sales in each of the first two quarters of 2008, the slower second half prices held steady throughout the year.  As you can see below, the average sales price at Park Place, in the second half of 2008 was a $962,600, with a high of $2,225,000.

The two lowest priced unit were an REO and a short sale – what a surprise.  Similar to other high end buildings, the average sales price was about 5% below the average asking price.  And with 2 sales that had banks involved and one sale at $2.225 million dollars, it’s easy to see why the average market time was 91 days.

Again, over all of 2008, there were only 20 sales at Park Place.  The building has 178 condos total, so the second half of 2008 saw less than 3% of its homes sold.  This is similar to the Grande towers, which saw 4.3% of it’s condos exchange hands.

What’s next? Well right now, there are nine condos for sale at Park Place, only one of which is a distressed sale.  Park Place also has one unit currently in escrow, which is a 1,545 square foot 2 bedroom plus den unit.  This floor plan offers some great city and bay views, but isn’t great if you need larger rooms.  Both the den and second bedroom are pretty small, but it does have two balconies.

If you’re thinking about buying, or selling, you should read this and this.  If you have any questions or requests, email me at denny@sandiegoh.com or call me at 858–243–2092. Thanks.

Click here to see all condos for sale at Park Place.

Click here to see some of downtown San Diego’s best deals.

Of the 19 sales, from July-December of 2008, 8 were distressed sales – either short sales, or bank owned homes.  Of these short sales and foreclosures, many had a sales price equal to what the banks were asking.  In fact, the average sales price was only 2% below the list price.  Compare this to the “regular” 11 other sales that had an average sales price of 6% below asking and it’s clear that short sales and REOs were better priced condos.  And aside from one ridiculous sale, none of the “regular” sales sold at full price.

What does this mean? Well, with 8 out of 19, or 42%, sales being distressed sales, clearly it shows that even some of the best addresses are being affected by the market.  Actually, it really isn’t the “market’s” fault, rather than the homeowners who over extended themselves.  I imagine it was a case of people getting too greedy, too hopeful and too careless. People leveraged their homes way too much and had to pay the price.  Yes, clearly the lending industry needed to have been more regulated, but I still think the majority of the blame falls on the homeowner.

Opinions aside, here’s a look at the numbers…

In the first quarter of 2008, The Grande towers had 15 sales with an average sales price of $884,067.  Q2 at The Grande had only 4 sales, averaging $866,702 per sale.  With the increase in short sales and foreclosures, The Grande saw a lower average sales price in the second half of 2008, with an average sales price of $769,468.

Ironically, the first and second half of 2008 each had 19 sales between the North and South Grande towers – 38 sales, for the 442 condos – less than 8.6% of the entire inventory.  This is well with in the 7–10% “healthy” turnover rate.

What’s to come? with 38 active condos today, 8 condos pending, I think we’re going to see an upswing in sales.  Interest rates are down and prices are low.  I think prices will continue to slip over the next 18–24 months until the finally stabilize.  I don’t think we’ll see any major reductions, but the prices are at the mercy of the short sales and REOs.  Until all of that inventory is absorbed, prices must come down.

So what should you do? If you’re thinking about selling, I suggest you do it now.  I can promise you prices will not be going up anytime soon and while you probably won’t make a profit on your home, you will get more today than you will 6 months from now.  I think the key for sellers is to sell now so they have liquidity and be ready to jump on the next deal that comes around.

If you’re a buyer, it depends.  If you’re a cash buyer, you can afford to wait.  Interest rates don’t affect you, so you can wait for a great deal to come by and take advantage of your cash.  Banks love cash buyers and they’ll almost always beat out a loan.  If you’re a buyer who needs a loan, I’d suggest you start looking now.  While prices will probably continue to decline, slightly, the interest rates probably won’t – and any gains you might see on the lower prices will be negated by the increase in rates.

Additionally, buyers who wait will face more competition.  As prices level out, more and more buyers will come into the market.  The key is not so much, timing the bottom, but finding the right home under the best possible conditions.  If you know anyone who’s been actively trying to buy a home, ask them how many properties they’ve lost to other buyers.  You’ll be surprised…

For more information on the Grande, or other homes in San Diego, please contact Denny Oh at 858–243–2092 or denny@sandiegoh.com

Click here to see all the condos for sale at The Grande.

Click here to see great downtown San Diego condo deals.

The attraction to Park Place is partially due to it’s incredible views, especially from the ‘03 and ‘04 units.  Q2 had two of these units sell, which obviously kept the prices high. 

With only 7 active listings, only 1 being a short sale, Park Place once again proves to retain it’s owners more so than many other buildings.  Park Place’s Q2 median sales price is also much higher than the Grande’s, which was a respectable $817,500. 

I still think Downtown San Diego is some of the most undervalued real estate in the country.  Once we get some more companies to move their offices Downtown, prices are going to skyrocket.  And no, there’s not too much inventory being built.

Click here to see all the condos for sale at Park Place

Click here to see the best Deals

Based on the four second quarter sales, the median sales price at the Grande was $817,500. This is just 1% below the median sales price for the first quarter of 2008.

Of these condo sales, one was a townhouse(larger square footage, with no view brings price per square foot down), one was a second floor foreclosure(no view) and another was a short sale. The fourth was a 30th floor unit that sold for $1,249,000. Needless to say, these sales don’t reflect the typical sales here, but then again, 8 of the 33 condos that are currently for sale are listed as short sales, or foreclosures. At nearly 25% that’s a lot of distressed listings in a quality, high end building.

We’ll see where the market takes us, but for now, if you want to make some money, click here.

Click here to see all the condos for sale at The Grande.

Other Must Reads:

Downtown San Diego’s Condo Inventory

Downtown San Diego Condo Watch

When the market was hot and prices were rising daily, the media pushed people forward, talking about how prices are never going to stop rising and that people should buy now.  Today, as the market readjusts, the media has changed it’s stance and tells everyone to be weary about buying real estate. To me, it sounds like they were wrong in both cases.

I’m seeing more activity and less inventory on the market.  Multiple offers are once again not a rarity and while I don’t see it becoming a seller’s market for quite some time, I do see a shift.  I’ve said it before and I continue to believe it – buyers who are looking today will get the best deals.  As consumer confidence grows over the next year or two, sellers will gain more leverage and the deals will not be as great. 

My advice…start looking now and see what’s out there.  Don’t worry about the papers and don’t just buy anything.  Look for a deal and for something that will hold it’s value – regardless of what inventory is being built.  As one of my readers said, “Your regular readers should really pay attention to your deal section…I think you are right on the money…I would have saved myself a lot of energy finding the ‘deal of year’ just watching you site instead of doing the work myself.”

Thanks to those of you who do read and subscribe. 

Oh wait, let me guess – now you think Downtown San Diego is over built, right? I don’t blame you. The media paints a terrible picture and I’m sure you have at least one neighbor, one coworker, or one relative who’s been trying to sell their home and they keep dropping the price. Yes, it’s a slow market but homes are selling. I’d bet that if you asked the people you know who are trying to sell their home, if other homes in their neighborhood have recently sold, that they’d say yes. The problem is that some people are still being unrealistic when it comes to pricing their home right, or maybe they just have a bad Realtor.

Now let’s take a look at Downtown San Diego’s inventory.

Aria is an Australian built building that is located in the Cortez Hill area. Aria was completed earlier this year and still has about 100 condos left to sell, out of 137 condos total. Aria is the second building that it’s developer, Anka, has built in San Diego. The first was Alta which is located on 6^th and Market – Aria is a nicer building, but many people prefer Alta’s location.

Breeza is a mid rise building that is scheduled to be completed in November of 2008. Located at the southern edge of Little Italy, Breeza is an Intergulf building(they also built Treo and La vita) which will only be nine stories, with 158 condos. Breeza has sold around 100 condos, leaving them with just over 35% sold.

Both Breeza and Aria are mid-level buildings.

Sapphire Tower is being built by Centurion Partners and is scheduled to be completed by the end of 2008. Sapphire Tower will consist of 96 condos on 32 floors. The building is approximately 55% sold, with only 40 or so condos left. This will be a high-end building, focusing on larger floor plans and luxurious amenities. Sapphire Tower is located in the Columbia District, next to The Grande.

And those are the only three new buildings Downtown San Diego will be seeing in 2008.

For 2009, San Diego will be introduced to Bosa’s Bayside and Pointe of View development will bring Vantage Pointe to Downtown.

Bayside is located in the up and coming Columbia District and will be a very high-end luxury tower. With 241 condos, Bayside will also be focusing on larger, luxurious floor plans and will even feature electric car charging stations. Bosa has sold approximately 40% of these condos.

Vantage Pointe is an East Village project and will bring a whopping 679 units to the market. Currently, they have sold 45% of these units, but I’m not sure the remaining 370 or so units will go forward as condos. It is rumored that a portion of these will be kept as rental units(there are three towers to this building) and not sold off. Vantage Pointe is an entry-mid level building.

So there you have it. In the next 12 months, there will be at most an additional 1,174 condos(not including the already completed Aria) in Downtown San Diego. Of these, approximately 513 have already been sold – 44% sold.

What about all the other buildings that are supposed to be built? Well to make a long story short, they aren’t. Here’s a list of buildings that have “no tentative date,” or are up for sale, but do have permits approved, according to CCDC:

• 11th and B – 196 condos
• 14^th and K – 222 condos
• 16th and G – 525 condos
• 17^th and G – 122 condos
• Grand Pacific Tower – 86 condos
• Laundry Lofts – 208 condos
• Library Tower – 174 Condos
• Lofts 34 – 32 condos
• Market Street Village II – 244 condos
• Monaco – 286 condos
• Riva Trigoso – 40 condos
• Solara Tower – 185 condos
• Triangle – 57 condos

That’s 2,377 condos that are either put on hold, or won’t ever be built.

Outside of 2008 and 2009, only 15th and Island(617 condos in 2011), India and Beech(78 condos in 2010) and Pier(228 condos in 2010) are scheduled to move forward. Sure there are buildings being built, but not as many as most people think. A lot of places have been put on hold and many will probably move forward as rentals. And keep in mind that only a few higher end buildings will be built. You can look at the total number of condos being built and just say, “too much is being built.” Take a minute to figure out what you want to buy and how much of that is being built.

San Diego is under priced. There are no better West coast metropolitan cities and we are the cheapest – by far.