How is the real estate market? That’s a question I hear all the time, but don’t quite always know how to answer. It just depends. For some, it’s a great market because rates and prices are so low. However, for those same exact buyers, it’s a bad market because there’s nothing to buy and all the good homes seem to get multiple offers and sell too quickly and for too much. On the selling side, the same factors apply: low mortgage rates and low inventory help increase demand pricing. Low prices on the other hand, clearly are not a sellers best friend.
Additionally, it depends on what, where and when they’re buying/selling. Some prices points are busier than others and some markets are hotter than others. Generally speaking, entry level homes are selling quickly and the higher end markets are slower. For downtown real estate, having the only “X” floor plan on the market(or the only one with a protected view) will definitely help bring a higher price.
Looking at the two newest downtown San Diego condo highrises, Bayside by Bosa and The Sapphire Tower, it looks like a lot of people have faith in the downtown market. Bayside at the Embarcadero sold 34 condos in the first three quarters of 2011. 12 of these sales were above the $1M range and five of those 12 were for more than $2m.
On average, condos at Bayside sold for about 13% less than the asking price. However, this is mainly because the developer kept it’s prices high to give the buyer a large discount – probably a strategy to make the buyer think he/she was getting a good deal. The average $/sq.ft. was about $565/sq.ft. and the average sales price was just under $1.1M – not bad for a “bad market.”
DOM, which stands for Days on Market, isn’t something I really look at in new homes sales. This is because the figures are often skewed, since developers don’t put all their condos on the MLS/market at the same time. In other words, the true DOM would be more like 2 years since the building was completed in 2009. I also look at $/sq.ft. with a grain of salt since certain floor plans have much better views than others(which are reflected in their price), or being only a few floors higher(even in the same floor plan) can drastically improve/worsen a view. Looking at comps without knowing the true details doesn’t always paint a clear picture(read: please let me be your agent and help you!).
Currently, there are 16 active listings at Bayside and only a couple Bosa units left.
Moving on to the other “new” highrise in San Diego, we have Sapphire Tower. Sapphire Tower is a much smaller building than Bayside. With only 97 condos, versus the 232 at Bayside, Sapphire Tower has/had much less inventory to sell. In the same first three quarters of 2011, there were 17 sales at Sapphire Tower. The average sales price was lower than Bayside’s at about $855,000, but was only 6% below the average asking price. In terms of price per square foot, Sapphire Tower’s recent sales had an average of $519/sq.ft. – about 9% lower than Bayside.
Right now, there are 14 condos for sale at Sapphire Tower(only 10 of which are on the MLS). The average list price of those on the MLS is right around $1.3M.
Based on 92101’s YTD sales, I think we’re in a fairly healthy market. With 821 downtown San Diego condo sales this year, we’re looking at approximately 80 sales a month. And with only 264 active listings downtown, I’d say that’s not too bad of a picture. Banks seem to be moving quicker with short sales(especially Chase)
If you’re looking to buy or sell real estate in San Diego, please contact Denny Oh for more information. Just give me a call or shoot me an email.
Denny Oh 858-243-2092 [email protected]