In case you haven’t heard, rumors that our housing market is going into a double-dip are once again alive and kicking. Several people have asked what I think of this in relation to North San Diego, and whether it really is true. My answer: yes and no (you didn’t think it would be simple, did you?)
The latest news, just released yesterday by Clear Capital, states that prices fell in March and April, compared to the same time last year and the prior low in March of 2009. They credit the bank owned inventory (REOs) as the main culprit, stating that there has not been a rate of decline this strong since 2008 – the rate was cited as 11.5% over the previous 9 month period. As more than one third of home sales nationwide are REO the company predicts that prices will continue to drop, since these properties typically sell for less than regular sales, thus bringing down comparable solds.
Although it is true that the Western states were cited as particularly effected by the above data and predictions, it is a misnomer to compare this data to the hyper-local North San Diego market. Let’s take a look at Carlsbad to compare:
1. Average median sales price: Although the average median sales price – $540,000 – dropped slightly from January to March (by an average of $35,000, or -0.6% decrease compared to last year), home sales were up 5.8% compared to last year. The median sales price appears to have remained steady over the last several months, with only slight drops. Comparing to the Clear Capital report for the nation, Carlsbad’s prices have fallen slightly less than the national number (.06% to .07%).
It appears that we are seeing prices drop slightly, but not quite as much as in some other areas, such as the midwest, where they have already entered into a true double dip market.
2. Lower number of REOs compared to other areas. Right now there are currently 31 REO properties on the market in all four zip codes that comprise Carlsbad. There are 695 total active properties listed, so REO listings comprise only .04% of total actives.
3. Lower number of short sale properties: There are currently 95 short sales in Carlsbad, or 0.14% of listed homes are considered short sales. This number is undoubtedly smaller than other areas across the country like Las Vegas or Phoenix. In this light I think Carlsbad and other north coastal areas are fairing quite well. In fact, Carlsbad 92011 in the past had been the zip code with the lowest number of foreclosures in the entire county (I am looking into whether this is still the case, but I assume if not is it surely still one of the lowest).
Even some areas in our own county have higher numbers, like Chula Vista for example. Of 769 active listings in Chula Vista, 98 (0.13%) are REOs and 350 (0.45%) are short sales. These numbers are three times as high as Carlsbad’s numbers. Areas with less distressed properties will not likely see drops in price quite as large as one may see in markets saturated with these types of properties.
The bottom line is that yes, prices have dropped slightly in North San Diego. But you really do need to focus on a specific areas rather than the big picture if you are a buyer or seller. Not doing so is a common mistake many people make, so if you are thinking of buying or selling consult a local, experienced agent in your specific area to provide a complete analysis of prices and sales.
If you would like live market data for North San Diego cities (like the chart above and with different categories to choose from), please visit my website at http://www.LaMarRealEstate.org. Click on the resources tab at the top right, and then Live Market Data. You can even sign up to receive weekly reports.