My San Diego Real Estate Predict
ions for 2014: 2013 was a firestorm for San Diego real estate. For the first half of the year, we experienced a strong sellers market with multiple offers from home buyers on just about anything with walls, a door, and a roof. By the second half of 2013, San Diego real estate inventory levels started to rise along with an uptick in interest rates. The result was a return to a balanced or normal real estate market. So what is in store for 2104 in San Diego?
- Prices Will Continue to Rise but at a Sustainable Pace. San Diego will see an increase in home inventory as more homeowners achieve positive equity and sell their homes. This will include the “move up” home seller and the retirees looking to “down size”.
- Interest Rates Will Continue to Rise. The Federal Reserve announcement that it is reducing their purchase of mortgage backed securities should create an upward trend in interest rates that could slow price escalations. We will be at a or near 5.2% by close of 2014 as compared to approximately 4.5% in the present market.
- The Number of Investor Purchases Will Decline but Remain Substantial. Although prices have risen, there are still plenty of decent deals to be had. The renovation / flip market will continue to dwindle but investors looking to purchase San Diego real estate and hold for the extended term will remain prevalent in the market.
- Population and San Diego Job Increases Will Continue to Push Real Estate Prices Higher. Favorable job reports and paradise type weather will continue to keep demand high for San Diego real estate. There are more people and families than housing currently available.
- New Construction Will Rise from the Ashes. Home prices continue to rise and justify new construction, particularly given land, labor, and materials costs. In addition, lenders will make loans and credit easier to obtain for smaller builders and developers.
Questions? Comments? Please send them my way anytime!
