More experts are calling a bottom to the San Diego real estate market. On Saturday the San Diego Union Tribune featured a quarterly report by MDA DataQuick which showed price increases in 8 of 56 neighborhoods during Third Quarter 2009. The largest increase was in West Escondido (zip code 92029) where the median price of a single-family house increased to $537,000, up from $467,000 in the third quarter of 2008.
The DataQuick report and numbers were not published in the Union Tribune, so I went to investigate. Unfortunately, no such quarterly report is posted on the MDA DataQuick website. The median sales prices of resale houses and condos, new homes, and all San Diego homes combined are published as the “San Diego Union Tribune Zip Code Chart.” There is also a report dated October 13, 2009 which is entitled “Southern California home sales inch up; median price steady.” Those are the figures that I will consider here.
First, according to the chart of median San Diego home prices by zip code, the median resale price of a detached single-family house increased in four out of five regions in San Diego County. Between September 2008 and September 2009, Central San Diego was up 4.3% (to $386,000), East County up 0.6% (to $316,750), North County Inland up 2.7% (to $380,000), and North County Coastal up 11.5% (to $485,000). Only South Bay remains in the red, with the median price of detached single-family houses down and average of 11% (to $316,000) from September 2008.
In Central San Diego, the median price of La Jolla homes sold in September 2009 jumped 21.7% from a year earlier, to $1,525,000. The median price of Coronado homes also increased substantially, up 17.6% to $1,610,000. The biggest increase along the North County coast was Cardiff by the Sea, where the median house price increased 38.9% from a year earlier, to $722,500. Del Mar homes also got a boost, up 11.6% to $1,350,000. Looking at those numbers, it would be tempting to call a bottom to San Diego luxury homes. However, in North County Inland, Rancho Santa Fe real estate is lagging. There were only 6 Rancho Santa Fe homes that closed escrow in September 2009, and the median price of $1,550,000 was down a whopping 43.6% from a year earlier.
Condominium sales tell an entirely different story. From September 2008 to September 2009, the median price of condos fell in all five regions of San Diego County. And, whereas houses in South Bay registered the largest price declines, the median price of condos in South Bay held steadier than the price of condos in any other region. Central San Diego condos were down 9.3% (to $245,000), East County down 21.2% (to $130,000), North County Inland down 8.2% (to $202,000), North County Coastal down 10.6% (to $316,500), and South Bay down just 1.6% (to $180,000).
New home sales represented only about 10% of the sales in each region. The median price of new homes is down for the year in four out of five San Diego regions. There seems to be little doubt that new home sales continue to be sluggish. Builder incentives may even be understating the level of price declines, as many builder incentives, upgrades, and closing cost credits are not reflected in the final sales prices.
Looking at the final tally of all sales of San Diego homes, the median prices of all homes sold in four out of five regions of San Diego County are just about flat (between 0.2% increase and 1.5% decrease), and South Bay is still in double-digits, down 11.2% from September 2008. But, as always, the median prices don’t tell the whole story. It seems clear that the low inventory of San Diego houses for sale has created upward pressure on prices. But despite the relatively low inventory, San Diego condos continue to experience price reductions. This suggests that the old adage “the value is in the land” is holding true in the current economic environment. And finally, more San Diego luxury homes are selling, so the upper end is seeing median price increases in some neighborhoods, such as La Jolla and Coronado. But there is still a lot of inventory at the upper end, so your San Diego real estate professionals aren’t willing to call a bottom in that sector.