Posts Tagged ‘market predictions’

2017 San Diego Real Estate Market Predictions

Wednesday, December 21st, 2016

If you are like me you are surprised we are at the end of the year already, but the good news is that the real estate market fared well this year, and will likely continue to do so in 2017. Here are my annual predictions for the market, at least here in San Diego County: index

1.  Home inventory will remain low. Due to a combination of factors – rising interest rates, expenses of moving up and difficulty of finding replacement housing, many potential home sellers will likely choose to remain where they are and not sell. This trend defined the market in 2016 and I believe it will continue. Until Americans see how the new President will affect the market I am betting on this.

2.  Prices will stabilize for the most part. 2016 saw prices still rising slightly in some areas, and higher in others (especially in summer months), but for the most part things seem to be leveling off. I think we will return to “normal” annual price appreciations of 5-7%. Of course this is always area-dependent so check with your local realtor for market statistics and area comparables.

3.  Market times will decrease or remain low for desirable homes. Due to the continuation of lower inventory levels I believe we will see desirable homes sell quickly. But I also think that buyers are very savvy and will not pay crazy high prices either – although in a multiple offer situation you never know.

4.  First time buyers could have a difficult time with competition. As interest rates rise, inventory levels decrease (or remain low) and prices remain high, many first time home buyers may find themselves in challenging situations when looking for homes to purchase. Competition will also factor in, especially in areas where there is an influx of repeat homebuyers who are moving up and are well qualified (with large downpayments). My advice is for those first time buyers to get preapproved and start looking now. Click here to read more on how to “win” that home you want.

5.  Interest rates will rise. This is inevitable and we have already seen the beginning of the end of the lowest interest rates in history. The new administration will also play a role in the interest rate rise as economic goals fluctuate.

The bottom line is that I believe the housing market will do well in the coming year. I do not predict any “bubbles” as some (very few) have done. I think here in San Diego County our market is strong and will continue to be as we head into 2017.

As I always say, if you are thinking of buying or selling in the future you need to do your homework and start early – even a year is not too early. Study the markets, visit homes for sale, get to know inventory, neighborhoods and floorplans. Talk to a mortgage professional and plan ahead. Find a great local real estate agent and let him or her keep you informed so you are ready to go when the time is right. Be prepared and have a wonderful new year!

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2016 Real Estate Market Predictions

Tuesday, December 8th, 2015

Around this time of year there are numerous posts on real estate market predictions for the coming year, so yes, this one will join the club. But it is important to note that in my opinion, one can only attempt to make accurate predictions (keeping in mind that no prediction is ever accurate) at a hyper-local level. I cannot predict what is in store for the market in Columbus Ohio or Memphis, Tennessee. But I can give a pretty accurate prediction for San Diego County, California. crystal ball

This past year the San Diego County real estate market has seen great improvement, with Spring and Summer sales contributing to the annual state sales growth of 7.2% (some areas exceeded that number). We also saw many multiple offer situations in the high season. That has calmed down as we headed into and through the Fall season, but there are still buyers out there now and properties continue to go into escrow – since Thanksgiving the market has really picked up in North San Diego.

Here are my predictions for 2016:

1. Steady sales. As we head into 2016 I think real estate sales will remain steady. As long as there is not a major financial situation or big rise in interest rates (which I doubt), I think we will continue to see sellers listing homes and buyers making offers. Homes that show well, or homes that are priced very well for what they offer, will continue to generate sales. I believe price will play a big role – gone are the days of sellers listing over comparable market price (unless of course the home is unique – big ocean view, fully upgraded, etc.). If you are a seller and want to sell your home, it will be all about price- more so than ever.

2. “Normal” price increases. I think prices will remain relatively steady, barring any major crises in the economic sector. I believe we will see possibly a 5-6% growth in prices overall in 2016, which is considered “normal” in many markets. San Diego will always have a slightly higher increase in annual sales compared to some other areas of the country, due to location and weather.

3. Inventory growth, albeit slowly. Over the last few years there has really been a slow down in inventory, although 2015 showed some positive signs of increases. I think as we head into 2016 we will continue to see slight increases, as people continue to feel more confident in the economy. Rising rates could spur potential sellers to list their homes before rates get too high (although I do not believe that will happen – but of course even slight raises could spur fear of bigger ones, which means fewer buyers).

4. Rising interest rates. There has been a threat of rising rates for some time, but I think in the coming year we will see slight increases – at least one, maybe twice. This should spur some buyers to jump off the proverbial fence, but could also cause others to jump up there. It would likely create inventory growth, as sellers fear the latter scenario.

Overall I think 2016 will continue to be a positive for the real estate market in San Diego county. In areas such as this – with our proximity to the coast and beautiful weather – there is never a true slump. If you are considering selling or purchasing a home, regardless of where, consult with an experienced real estate agent to get an accurate market snap shot so that you are prepared. Happy New Year to you all!

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