San Diego California Housing Double Dip
real estate double dip
In my 7-7-10 my post: San Diego real estate 2010 2nd. Half Outlook … double-dips I said that my local San Diego real estate market observations indicated that we are heading into a double dip for the real estate market.
Here is what Forbes just said: “The final figures for the U.S. housing market’s performance thus far in 2010 won’t be officially released for several weeks. But a review of the best preliminary data available indicates that the recovery in home values that began in early 2009 has stalled. A second dip is clearly under way in some places, if not across the entire U.S.”
Yesterday the San Diego Union Tribune said: “San Diego County’s rapid run-up in home prices over the last few months took a breather in June, as sales activity remained relatively flat, although still more robust than earlier this year, MDA DataQuick reported Monday”.
Last month’s sales of 3,885 homes and condos marked the highest June figures in four years, although DataQuick pointed out that it was still 17 percent below the average activity for that month since the company began tracking the market in 1988!
Figures provided by FICO Inc. show that 25.5 percent of consumers — nearly 43.4 million people — now have a credit score of 599 or below, marking them as poor risks for lenders. It’s unlikely they will be able to get credit cards, auto loans, or mortgages under the tighter lending standards banks now use.
The San Diego Association of Realtors reported active listings on the market stood at 12,047 as of Monday, up from 9,209 a year ago.
Keep in mind, a large number of properties that closed in June reflected sales influenced by the Federal tax credit which applied to homes that entered escrow before April 30th.
The best seasonal real estate marketing time of the year, combined with some of the lowest home mortgage rates in 40 years, prices at 40% below their 2005 peaks, and the tail end of the Federal tax credits, could at best produce anemic real estate sales results.
Perhaps everyone is missing one vital fact …. The real estate downturn that started in 2005 was so severe and prolonged that it has broken the myth that owning San Diego (or California) property was a sure way to gain wealth through guaranteed appreciation.
Better fasten your seat belts when July home sales are reported in another 30 days!
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I’m looking forward to things getting better.
it was very interesting to read.
I want to quote your post in my blog. It can?
And your an account on Twitter?
We saw an almost immediate drop in pending sales in our area after the tax credit expired. In some areas, it was a much as a 30% decline month-over-month.
The good news is that with the inventory level now increasing, many of the home buyers we are working with that are using FHA or VA loans can now have a better shot of getting their offer accepted on REO and short sale properties.
During the early part of the year, before the tax credit expired, it was becoming frustratingly difficult to win bidding wars on the best properties.
Now there are a few more homes to go around.