Buy, Sell or Blog?

Insider Market Update

May 8th, 2018 12:05 PM by Heather Tardanico

The number one question that we always get asked is, “How’s the market?” So, we thought we would give an “insider’s” perspective on what we have been seeing lately.

Being on the front lines of the local real estate market we tend to see and hear things several months before the news begins to report it. We always tell our clients that if you hear market updates in the news, it's already too late, whatever they are reporting happened months ago. With that in mind, we wanted to share a quick update from a mastermind meeting that we just had last week with some other top agents in our office and our operating partner, who is very well connected to the executives at Keller Williams International. The meeting was centered around what's happening right now in the market, the rumblings about a potential "shift” on the horizon, and what we need to do to educate and protect our clients.

A couple of the big factors around the country, and especially in San Diego, center around affordability and interest rates. The market has been on fire since 2012 with huge gains, that in most neighborhoods have surpassed the last peak in 2006/2007. In fact, San Diego County prices for condos hit an all-time high in February of this year, almost topping the $500,000 mark, with an average price of $499,388 which surpassed the previous high of $457,395 in March of 2006. Single family detached homes also hit a record high in March, topping the $800,000 mark at an average sales price of $829,940, surpassing the previous high of the last cycle of $792,402 set in June of 2007.

The second part of the equation is rising interest rates. Rates have been on the rise in the last year, moving from the low to mid-three percent into the mid to upper-four percent range. We are hearing a lot of economists predict that this trend will continue, and we could be seeing rates into the mid-five percent range later this year. With a continued rise in rates, we may start to see potential home buyers fall out of the market as they will no longer be able to afford the homes that they desire to purchase.

On top of the recent peak in prices and rising interest rates we have been hearing through the grapevine that many banks are staffing up their loss mitigation departments which handle their foreclosures and short sales, and several local builders have been pushing to speed up construction on their projects to get their inventory on the market this year.

Because of these factors we have been seeing many buyers and sellers who were previously on the fence and thinking of buying or selling in the next couple of years begin to jump into the market while they can. Buyers want to take advantage of the lower rates, and sellers want to take advantage of the prices and get the most out of their property before rising interest rates and buyer fatigue begin to take a toll and start to put pressure on prices.

If you or someone you know are considering buying or selling and would like to get more information on your options and a potential strategy, please give us a call. We always love to talk about the market and are happy to help in any way that we can! -Michael Barrow


My Favorite Blogs:

Sites That Link to This Blog: