Monthly Market Overview North San Diego County May 2020

While the effects of COVID-19 in the broader economy continue, real estate activity is beginning to recover across much of the country. According to
Freddie Mac, mortgage rates have been below 3.3 percent for more than four weeks and are hovering near all-time lows, spurring strong interest by buyers and lifting showing activity up 4% nationally versus a year ago in the final week of May.

  • Closed Sales decreased 48.3 percent for Detached homes and 49.3 percent for Attached homes.
  • Pending Sales decreased 6.1 percent for Detached homes and 5.1 percent for Attached homes.
  • The Median Sales Price was up 2.1 percent to $745,000 for Detached homes and 2.2 percent to $465,000 for Attached homes.
  • Days on Market decreased 15.6 percent for Detached homes and 17.2 percent for Attached homes.
  • Supply decreased 37.5 percent for Detached homes and 24.0 percent for attached homes.

Buyers have been quicker to return to the housing market in force than
sellers, who have been showing a bit more reluctance to list their homes than is typical for this time of year. But trends are improving and as states and localities continue to moderate their COVID-19 policies, real estate activity is expected to continue to improve in the coming weeks.

San Diego North County Monthly Housing Market Indicators May 2020

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May-20-Monthly

Monthly Market Overview North San Diego County January 2020

For 2020, The National Association of REALTORS® Chief Economist Lawrence Yun sees good news for home prices:

“National median home price growth is in no danger of falling due to inventory shortages and will rise by 4%,”

the long-term NAR economist predicts. He is also expecting the new home construction market sales to increase 10%. Yun and others would like to see home builders bring more affordable units to market to help ease shortages and slow price gains in that segment.

  • Closed Sales increased 6.0 percent for Detached homes and 12.3 percent for Attached homes.
  • Pending Sales increased 8.1 percent for Detached homes and 26.7 percent for Attached homes.
  • The Median Sales Price was up 11.9 percent to $742,750 for Detached homes and 9.1 percent to $485,000 for Attached homes.
  • Days on Market decreased 8.2 percent for Detached homes and 2.4 percent for Attached homes.
  • Supply decreased 40.7 percent for Detached homes and 28.6 percent for Attached homes.

We start off the year with continued low interest rates, low unemployment, and rising rents nationally. These factors should encourage healthy buyer demand and sets us up for a strong start to the 2020 housing market and a lot of optimism for the coming spring market.

Jan-20-Monthly

Annual Report on the North San Diego County Housing Market for 2019

The 2019 housing market was fueled by the overall strength of the economy across most of the country. The stock markets reached new highs throughout the year, improving the asset bases of millions of Americans. Unemployment rates fell to 50-year lows, while wages increased, creating new home buyers. Mortgage rates also declined significantly from 2018, helping to offset affordability stresses caused by continued price appreciation nationally.

With a strong economy and low mortgage rates, buyer activity has been strong. However, most markets are being constrained by inventory levels that are still below historical norms. With supply and demand continuing to favor sellers, prices continue to rise.

With 10 years having now passed since the Great Recession, the U.S. has been on the longest period of continued economic expansion on record. The housing market has been along for much of the ride and continues to benefit greatly from the overall health of the economy. However, hot economies eventually cool and with that, hot housing markets move more towards balance.

Sales: Pending sales increase 4.1 percent, finishing 2019 at 15,118. Closed sales were up 1.4 percent to end the year at 14,785.

Listings: Comparing 2019 to the prior year, the number of homes available for sale was lower by 32.6 percent. There were 1,974 active listings at the end of 2019. New listings decreased by 4.6 percent to finish the year at 21,603.

Distressed: The foreclosure market continues to remain a small player in the overall market and is likely to remain that way in 2020. In 2019, the percentage of closed sales that were either foreclosure or short sale decreased by 1.6 percent to end the year at 6.2 percent of the market.

Prices: Home prices were up compared to last year. The overall median sales price increased 0.5 percent to $637,000 for the year. Single-Family Detached home prices were down 0.1 percent compared to last year, and Single-Family Attached home prices were up 2.2 percent.

List Price Received: Sellers received, on average, 97.1 percent of their original list price at sale, a year-over-year reduction of 0.2 percent.

While the Federal Reserve moved to temper the hot economy with four interest rate hikes in 2018, in 2019 they turned the heat back up, and reduced rates a total of three times during the year. The Fed’s rate decreases were due in part to GDP growth in 2019 that came in notably lower than 2018, showing the Fed’s alternating efforts to keep our economy at a steady simmer and not a full boil.

The housing market continues to remain healthy nationwide with price gains and limited inventory being the most common threads across markets. Tight inventory continues to constrain buyer activity in part of the country, while some areas are seeing increased seller inventory starting to improve buyers’ choices. New construction activity continues to improve, but is still below levels required to fully supply the market’s needs.

As we look at 2020, we see continued low mortgage rates and a healthy economy giving a great start to housing in the new year. But in election years, we sometimes see a softening of activity that may temper the market in the second half of the year.

Annual-2019