According to MDA DataQuick, 52.1% of all home sales in San Diego last month are foreclosures. Compared to the previous years’ records, median home prices now are very low at $305,000, from its peak of $517,000 in November 2005.
Real estate analysts say that foreclosures pull down properties’ prices, even those in higher-value neighborhoods, and that even homeowners who do not need to sell are waiting.
This is really a bargain-hunting time for you. As a matter of fact, there are lots of first-time homebuyers now who are pleased of foreclosures pulling down prices, increasing affordability.
However, looking at the side of the home sellers and the housing industry, the fact that foreclosures comprise more than half of home sales do not actually imply a move-up purchase, instead it just repays lenders.
The North County Association of Realtors Homedex has reported in its affordability report that about 33% of San Diegans can afford the median-priced single-family home last month, and about 59% can afford a condo unit.
Median prices have dropped. An existing single-family detached house has now dropped to $335,000, and $204,000 for an existing condo. On the other hand, the median price of a new house has risen to $509,000 from $444,000 last year.
New home inventories have gone down. In fact, there are only 87 new home building permits that have been issued last month, which is a 20-year low as reported by the Construction Industry Research Board.
Almost 50% of home buyers in San Diego use government-insured, FHA financing. With the adjustments for inflation, current mortgage payments are now 37.4% lower than typical payments that have been made in 1989, which is said to be the peak of the early real estate cycle, and 48.7% lower than the peak of the current cycle in June 2006.
Grab the opportunity now and get that house of your dreams in the most affordable price.
Cassiano Travareli has been educated in the finer points of the foreclosures market over 5 years. Read about the following article Foreclosures: San Diego’s Majority of Home Sales by Cassiano Travareli.
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