Real estate prices nationwide have risen drastically in 2013. For the most part, there’s no reason why. Nothing changed…interest rates didn’t drop, there wasn’t a significant change in inventory and the economy didn’t take off. The only difference was that people decided to start buying real estate.
In downtown San Diego, prices jumped about 20% in the first half of 2013 – largely a result of buyers getting into bidding wars against themselves. From June of 2012 from June of 2013, the average downtown San Diego condo sales price went from $475,254 to $536,806 – a 13% increase. Looking at the first half of 2013, there was a low average sales price of $467,233 in February and a high of $567,410 in May….a 21.4% increase in the average condo sales price.
Although interest rates have jumped up by about 1% in recent months, the market is still strong and prices continue to rise. With unemployment numbers dropping to 7.4% in July from 7.6% in June and from 8.2% year-over-year, it won’t be too long until the Fed increases interest rates again. Inventory has also risen from about 140 active listings in January of this year, to 231 listings as of today – a 65% increase.
If you’re looking to buy, you need to get a pre-approval, or an updated one. With higher interest rates, your monthly payments are going to be higher and your purchase price has probably dropped. As a seller, should you wait or sell now? I think it just depends on what you’re thinking about selling. In some buildings/locations, you might better off waiting for inventory to dwindle:
Example 1 – there are currently nine 1 bedrooms for sale at Icon with an average market time of 72 days. I’d wait until a few sell before I put my place on the market.
Example 2 – condos facing the new CAC park (the Grande and Bayside) may want to wait until the park is done, or almost done. I think this addition will help property values rise, as buyers realize that the Columbia District is growing and becoming more of a “neighborhood.”
However, if you have something in the $600-900K range, you may want to list sooner than later. Currently there are only 55 active listings in this price range and the average market time is only 49 days. In the last three months, there were 55 condos that sold in this price point and the average market time was only 44 days.
If you have any questions about your property’s value, or real estate in general, please contact me at 858-243-2092 or [email protected]
ps – the latest rumors suggest that Bosa will begin building their next highrise, Santa Fe Depot Parcel 9, early next year!