San Diego Home Values

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August 13, 2013

The Value of Your Home: Up or Down over the Next Few Years?

Posted by martikilby under Buying a Home, Buying Investment Property, Interest rates, Real Estate Values, San Diego Home Values | Tags: , , , , , , |
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It’s not your imagination: The housing market recovery is on a roll, upwards! A recent survey of over 100 real estate and economic experts predicts that by the end of 2013, home values will have increased nationwide by an average of 6.7% over a year ago. This is significantly more than the 5.4% bump anticipated in an earlier study.

The Home Price Expectations Survey was conducted by Pulsenomics, LLC on behalf of Zillow. Based on market expectations, the panel predicts that home prices will continue to rise until 2017, coming very close to the record highs of May 2007. The rate of increase however will not be as dramatic as 2013, with appreciation anticipated to slow to 4.4% in 2014 and down to 3.4% in 2017. This represents a cumulative increase of 23.7% through 2017, at which point appreciation is expected to be more in line with historic norms.

Interestingly, most panel members did not feel that rising interest rates would derail the recovery, unless interest rates rise above 6.0%. According to Zillow Senior Economist Dr. Svenja Gudell, “As long as interest rates don’t rise too far and too fast, most markets should be able to absorb these changing dynamics and remain healthy.” It is anticipated that as interest rates rise, investors will pull out of some markets, increasing inventory and helping to stabilize the market.

What does this mean for you? If you are looking to buy, now is the time as prices will continue to rise. Looking to sell? You are more likely to get top dollar between now and the end of the year as inventory, especially here in San Diego County is very limited. As appreciation slows and more inventory hits the market it is less likely that the multiple offer scenarios that we are currently experiencing will continue.

Questions about the value of your home? Interested in an investment property? Just give me a call and I’ll be happy to answer all your questions.

 

June 7, 2013

Why Now May be the Best Time to Sell Your Home

Posted by martikilby under San Diego Home Values, Selling your home | Tags: , , , , |
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SGR-for-sale

Over the past 12 months, we’ve seen single family home prices increase by as much as 20% in some parts of the country. This is the most rapid increase since the housing bubble collapse, and largely driven by supply and demand. According to Zillow CEO Spencer Rascoff, nearly 44% of homeowners with a mortgage still owe more than their home is worth, thus even if they would like to sell they are unable. This, combined with fewer foreclosures, has created a scarcity of available homes on the market and helped push up prices.

So with home prices on the rise, if you do have equity in your home and have been considering a move-up, why sell now? Wouldn’t it make more sense to wait another year or so and take advantage of even higher prices?

Not necessarily. While low supply has been a factor in the recent price increase, it has been driven by demand created by historically low interest rates. However, mortgage interest rates are on the rise. Yesterday, in the fifth consecutive week of gains, the rate for a 30 year fixed mortgage rose to 3.91%. That is 18% higher than the lowest rate of 3.31% back in November 2012. According to chief economist for the National Association of Realtors, Laurence Yun, in an interview with Forbes magazine, “the rate will probably go up to 5% by the end of next year.”

The result of higher interest rates is likely to be a decrease in demand, especially in the higher priced areas of the country, such as coastal California, Boston and New York. Rascoff provided the following example in an interview yesterday on CNBC. “Imagine yourself buying a $300,000 home today, and in four years you may want to trade up to a $500,000 home,” he said. “That home is not just that much more expensive—but because mortgage rates are going to be higher—it’s significantly more expensive. So the trade-up market is going to be very troubled in a couple of years.”

So looking down the road a year from now, it is likely that interest rates will increase which will slow the demand, which in turn will put the brakes on home price increases. Thus, if you are considering selling your home, now may be the best time while demand is high and supply is low.

For more information about what this might mean for you and your San Diego County property, please give me a call.

 

January 11, 2013

Freezing Temps in San Diego but Real Estate is Hot, Hot, Hot!

Posted by martikilby under Buying a Home, Interest rates, San Diego Home Values, Selling your home | Tags: , , , |
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Okay, I admit to being a total wimp when it comes to cold weather. Waking-up to frost on the roofs and going out for a walk with gloves and a hat is not my favorite part of living in San Diego in January. But I have to tell you that my heart is warmed as soon as I turn on my computer, look at my emails, my transactions, and the MLS and realize that the San Diego real estate market is hot, hot, hot!

This is due to 4 primary factors:

1) Employment in the County in October was up by 1.9% over October 2011*
2) Consumer confidence (Pacific West) is up by 36%*
3) Interest rates remain at record lows
4) Inventory is approximately 50% of what it was a year ago*

The lack of homes to sell in San Diego County is clearly illustrated in these two graphs, which show unsold inventory at lowest point since 2005, and that homes in the $750 – $1000K range are the most scarce. However, as there are fewer people able to buy in that range the impact is less dramatic. The price range where we are feeling the greatest impact is the $300 – $500K range. If you’re a seller, you love it as you will likely have multiple offers within days of listing. If you’re a buyer, not so much, as it’s likely you’ll be in a bidding war with several cash buyers.

unsold inventory 10.12 sm

unsold inventory 2 10.12 sm

This of course has driven down the length of time homes stay on the market from approximately 60 days in January of last year to just 40 days in October.

time on market10.12 hero 2

The net result of all these factors is that prices in the San Diego real estate market are increasing at a steady rate, up 10.7% this October, over October 2011.

Median price 12

So is it a good time to buy or sell in San Diego? Absolutely! Barring any economic catastrophe I believe we’ll continue to see a strengthening real estate market throughout 2013. So if you’ve been considering a real estate investment, best to get in the game now as I predict prices will continue to rise. Please give me a call to discuss the opportunities available in America’s Finest City!

* Graphs and statistics courtesy of the California Association of Realtors®. All statistics reflect sales activity for detached homes.

 

May 31, 2012

I Love the House! How Much Should I Offer?

Posted by martikilby under Buying a Home, Realtor, San Diego Home Values | Tags: , , , , , |
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You’ve found THE house and you’re ready to take the big step and write an offer.  But what is the right price?  Should you start low or come in at full price?  Should you offer more than asking price to seal the deal?

Determining the best offer price is based on a variety of factors, the first being the price of comparable properties.  Your Realtor will research sales and current listings, usually going back no more than 6 months.  She will try to find homes that have a similar number of bedrooms and baths and square footage.   She will also look for properties in the same or similar neighborhood of the same age.  Other factors she will consider might be upgrades and amenities, such as a remodeled kitchen or swimming pool, or view.  The more like the home you hope to buy, the better the comps.

Reviewing the prices of the comparable sales and listings will usually give you a reasonable price range.  The next step in determining your offer price is to look at the condition of the home.  If there are obvious repairs needed, such as new carpet or paint your offer price might be at the lower end of the price range for the comps.  On the other hand, if the home is in move-in condition or has other outstanding features or upgrades, your offer price should be closer to the top end of the range.

Another important factor is the competition.  How long has the home been on the market?  How long were the comps on the market?  Are you competing against other offers?  Is there a scarcity or over-supply of similar homes in this price range?  As with any commodity supply and demand are important factors in determining price.

And finally there is an emotional component.  If this truly is your dream home and you can’t bear the thought of having your offer rejected, you might be inclined to offer above the asking price and even above the comps.  Just be aware that if you are getting a mortgage on the property and it doesn’t appraise as high as you are willing to pay, the difference will most likely have to come out of your pocket.  You should also be cautious about buying at the top of your personal price range or depleting your savings as it will be difficult to enjoy your dream home if you’re house poor.

As I noted in a post earlier this year price isn’t everything when it comes to getting your offer accepted, but it is the most important factor.  Work closely with your Realtor; listen to her guidance, ask questions and carefully weigh all of the factors.  In the end the decision is yours so please, do everyone a favor and don’t waste time with a ridiculously low offer!  If you want the house, bid like you mean it…you might not get another chance!

 

February 13, 2012

An Interesting Twist on Principal Reduction

Posted by martikilby under loan modification, Principal reduction, San Diego Home Values, Strategic Default, Underwater homes | Tags: , , , , , , , , |
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For most of the 22 million homeowners who owe an average of $40,000 – $65,000 more than their home is worth, the recent $25 billion dollar settlement with the banks will bring no relief. According to Robert Menendez, Chairman of the Senate’s housing subcommittee, “When you owe more than your house is worth, relief can be hard to come by.”   Among borrowers whose homes have dropped in value through no fault of their own, many choose to simply walk away, which according to Menendez, “Only exacerbates the problem.”

Menendez has introduced a bill that provides an interesting twist on the idea of principal reduction.  The Preserving American Homeownership Act would encourage lenders to write down principal balances by allowing them to share in the home’s appreciation at a later date.  The principal balance would be written down in increments over a three year period to 95% of the current value, so long as the homeowner remains current on their payments.

In exchange for the write-down, the lender would receive a fixed percentage of any future appreciation when the home is either sold or re-financed.  That share could not exceed 50%.  So if a principal balance was reduced by 25%, the bank would receive 25% of any future appreciation.

The Act would apply to primary residences only, but any homeowner could apply.  Borrowers who are in default or even in foreclosure could qualify, but would be required to make their reduced mortgage payment on time in order to remain in the program.

The article in DSNews where I read about the bill did not indicate if the Act would apply to all types of loans or whether or not the modified loans would be re-written at today’s lower interest rates. Presuming so, this Act could provide enough incentive to many underwater homeowners to persuade them to stay in their home versus initiating a strategic default.

As a fan of principal reduction, I like this idea as it seems to be a win-win situation for both homeowners and the banks.  Banks don’t take as big a hit as they would with a short sale or foreclosure, and the write-down is taken over a three year period, AND homeowners get to keep their homes with reduced payments and principal.  Even the opponents of principal reduction might find something to like about this plan!

 

December 21, 2011

La Mesa, CA Real Estate Market Update – November 2011

Posted by martikilby under Buying a Foreclosure, Buying a Home, Real Estate Sales Statistics, Real Estate Values, San Diego Home Values, San diego Neighborhoods | Tags: , , , , |
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La Mesa, CA Real Estate Market Update – November 2011

 

                                                 

 

 

 

La Mesa,CA is a great place to call home!  From the quaint downtown filled with restaurants and antique shops, to the views from Mt.Helix, there are many wonderful neighborhoods with their own distinctive vibe.  But like most everywhere throughout the county, real estate values continue to slip, as noted in this real estate market update.

La Mesa, CA Single Family Home Sales – November 2011

Total number of sales                       51

            Short sales                                 9

            REO sales                                   8

Average price                                     $381,197

Average days on market                 71

Average price 2010                          $417,252

Average price YTD 2011                 $387,727

Prices for single family homes have not showed a significant decline throughout the year, which may be a sign that the market is starting to level out.

La Mesa, CA Attached Home Sales – November 2011

Total number of sales                    14

            Short sales                             3

            REO sales                                2

Average price                                  $190,807

Average days on market              51

Average price 2010                        $190,580

Average price YTD 2011               $167,587

The average price for November for attached homes is surprisingly high when compared to the preceding months.  As we enter 2012 we will have to see if this is a trend, or merely a month with more sales of higher priced units.

To learn more about the La Mesa, CA real estate market, just give me a call!  I’ve lived in the area for over 20 years and would love to show you why this is such a great place to call home.

 

October 24, 2011

San Diego Home Sales Statistics

Posted by martikilby under San Diego Home Values, Underwater homes | Tags: , , , , |
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Check out the latest San Diego County home sale and value statistics. How well has your neighborhood fared in 2011? Just give me a call for specific information about your home.

 

October 7, 2011

Mortgage Interest Rates Hit Historic Lows

Posted by martikilby under Buying a Foreclosure, Buying a Home, Buying Investment Property, Interest rates, San Diego Home Values | Tags: , , , , |
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Freddie Mac announced yesterday that for the first time in history, the average interest rate for a 30-year fixed rate mortgage has dropped below 4.00%  to 3.94%.  Rates for 15-year fixed rate mortgages are even lower, at 3.26%.  Last year at this time the 30-year rate was 4.27%  and the 15-year at 3.72%.

When you combine the low rates with prices that have generally declined throughout the county you have a great opportunity to buy more home for less money.   On a $300,000 mortgage the principal and interest payment at 4.27%  is $1479 per month.  At 3.94%  the monthly payment is $1421 per month.   That is a savings of $58 per month which may not sound like much, but over the length of the mortgage, that is a savings of over $20,880.

So whether you’re looking for your first home, a move-up, or an investment property, now is a great time to buy!  Curious about what’s available?  Give me a call and I’ll be happy to send you some listings of homes and investment opportunities throughout San Diego County.

 

September 10, 2011

August San Diego Home Sales Statistics

Posted by martikilby under Real Estate Sales Statistics, Real Estate Values, San Diego Home Values | Tags: , |
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Overall, August was a good month and sales of detached and attached homes were up compared to August of 2010.  However, it’s the year-to-date numbers that tell the real story.

Compared to 2010, our year-to-date volume is down by 8.9%  for condos and 1.9%  for detached homes, and values have also slipped.  The median price for an attached home in August was $208,000 which is down significantly from a year ago when it was $220,500.  Detached homes have done slightly better, but the median price of $370,000 is nearly 4% down from $385,000 last year.

Some areas of course have fared better than others:

The year-to-date median price for a detached home in Cardiff  by The Sea is $892,500, up from $825,000 a year ago. Carmel Valley is also doing well with a median price of $915,500 up from $905,000.  And there has been little change in either Del Mar or La Jolla over the last year…both are holding steady at a bit over $1.3 million.

For most of the rest of the county however, home values have dropped.  We especially see this in areas that were new in 2005-2006.  Many of the homes purchased at the top of the market have now become foreclosures or short sales which tend to pull down the overall values in any neighborhood.

If you have questions about a specific area, just give me a call. 

 

 

 

June 17, 2011

Do You Owe More Than Your Home is Worth? You’re Not Alone!

Posted by martikilby under foreclosure, loan modification, San Diego Home Values, Short Sale | Tags: , , , , , , , , |
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A recent study by analytics company CoreLogic reported that nearly 25% of all mortgage borrowers owe more than their home is worth.  The aggregate amount of negative equity in the U.S. was a whopping $750 billion at the end of last year.   This lost equity prevents homeowners from refinancing or moving, and according to the report, is the “dominant factor” driving the real estate market.

If you’re among the millions who are paying each month for negative equity, you probably have some questions about your options.  To help address this issue, I’m offering a FREE workshop here in San Diego covering the following:

  • Should I wait for home values to increase?  What is the future of San Diego real estate?
  • What about a loan modification?  What programs are available, how do I qualify, and how many loan modifications are actually approved?
  • If I can’t afford my payments, what are my options?
  • What is involved in the foreclosure process?  How long can I stay in my home? How will it affect my credit?
  • Will filing Bankruptcy save my home?
  • What is a strategic default?  What are the risks?
  • What is a Deed in Lieu of Foreclosure?
  • Is a short sale better than foreclosure?  What is the process? What is a HAFA short sale?
  • What about deficiency judgments and 1099s?  When can I qualify to buy again?

Saturday, June 25th  10:00 – 11:30 a.m. 

San Diego County Library, 4S Ranch

10433 Reserve Dr, San Diego, CA 92127

There is no fee or obligation for attendance, but space is limited.  Advance registration is required.  Homeowners will receive comprehensive workshop materials.

Call 1-888-464-1820 x104 to Register Today

As mentioned previously, I’m not an accountant or lawyer and you should always consult the appropriate professional before making any major decision about your home.

 

 

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