The Joys of Real Estate

The average sale price of homes in San Diego County saw some slight changes in the fourth quarter of last year. Single family home price were down less than -1.0% whereas attached home prices rose 2.3%.  Relative to the fourth quarter of 2009 the average sale price of all homes is up 2.0%.  Although the prices look fairly stable over the last 1.5 years some areas   have seen some very big declines.

The seasonal trend in home sales can be observed in the chart to the right.  However, overall the total homes sold in San Diego County last year was 32,439 which was down -6% from 2009.  The 2009 sales were up because of the first time home buyer incentives.

Distressed sales are on everyone’s mind these days and are always in the news.  The chart to the right shows the 5 year history of the short sales and foreclosures as a percentage of total home sales.  Distressed sales have increased dramatically over the last 3 years with the recent trend showing a decline in foreclosures and short sales becoming the predominant method for distressed sales.  Presently short sales are 25% of the home sales while foreclosures constitute 22% of sales.

Interest rates are still near an all time low which is quite amazing.  The economy is picking up and when it does the rates will go up, but probably gradually.

What an amazing time to buy a home.  The house affordability index is at an all time high enabling many people to qualify to buy a home.  There are VA and FHA loans out there with as little as 3% down.  Prices are down significantly and are expected to be down at these levels for a while and there are a large number of homes available to choose from right now.  Who knows how long this opportunity will last.  People that buy now will be bragging to all their friends for years to come about the deal they got and the low interest rate they are paying.