Having spend the better part of Saturday in my post-conference decompression chamber, it seemed like a good time to get back to business. If you aren’t from around these parts, move along — there is nothing to see here. If, on the other hand, a little dose of market trend data is just what you needed to jump start your Sunday, you’ve come to the right place.
You’ve probably heard the rumblings. “Prices are up!” and “Homes are selling!” is the word on the street. Yes, no, maybe so. Here is a snapshot of the two-year market trends for the heart of the I-15 corridor. Data is for detached homes in Scripps Ranch (92131), Rancho Penasquitos (92129), and Rancho Bernardo/4S Ranch/Del Sur (92127 and 92128):
- Median prices are down over the past year, yet the trend line does seem to show signs of reversing. Whether this is just a summer fling and not a trend at all remains to be seen. We will know soon enough.
- The number of sold homes definitely follows a seasonal pattern. Expect the number of sales to drop accordingly as we head off to a new school year. The number of sales will be influenced not only by scary costumes, turkeys and eggnog but by our low inventory.
- Inventory remains low, and I see this happening in large part because so many people who would otherwise be selling are finding that market values are not favorable. Think “upside down.”
- The supply/demand curve is most definitely improving if you are of the seller ilk. What is really happening is that we are clearing the lower end of the market, and when we are left with only the higher priced homes (for which fewer buyers are looking), the pace of sales will be further effected.
The wild card in all of this we know is the troubled loan landscape, both the continuing stream of short sales and the next wave foreclosures on the horizon. The concept of loan modification salvation is becoming a pipe dream for many. In addition, the lifting of moratoriums on foreclosures many fear will flood the market with a new batch of value-killing offerings.
Fewer borrowers appear to be getting in trouble with their mortgages, and those that are in trouble are moving into foreclosure at a decreased rate. Nonetheless, the number of foreclosures is still growing as servicers begin to work through a backlog of troubled borrowers-which shouldn’t surprise, as HousingWire‘s key sources have long suggested such a ramp-up in foreclosure activity would be the outcome of various moratoria put into place earlier this year.
So, things are in fact looking up in the San Diego housing market, particularly from a seller’s perspective, but you don’t have my permission to don the party hats just yet. We have some ground to cover before we know where we really stand.