Median price at $340,000, up 15.3 percent from a year ago
ORIGINALLY PUBLISHED JUNE 14, 2010 AT 11:30 A.M., UPDATED JUNE 15, 2010 AT 12:15 A.M.
SEAN M. HAFFEY / UNION-TRIBUNE
This home on Capricorn Way in Mira Mesa is on the market for $375,000.
San Diego County housing prices, May 2010
San Diego County home prices, which were falling at double-digit rates a year ago, are now rising rapidly as investors grab the last remaining bargains and upper-end buyers find deals to their liking.
MDA DataQuick reported Monday that the May median price stood at $340,000, up 4.5 percent from April and up 15.3 percent from a year ago. It was the eighth straight month of year-over-year increases.
“Across the board, it looks like almost everything is off the bottom,” said DataQuick analyst Andrew LePage. “A lot of places are up a little from a year ago.”
But LePage said it isn’t that individual homes are appreciating rapidly — it’s just that there’s a broader mix of homes being sold.
For example, he said, North County coastal neighborhoods, excluding low-priced Oceanside, accounted for 10.1 percent of the county’s single-family resales in May, up from 8.1 percent a year earlier and even above the decade average of 9.6 percent. The number of sales in that area rose 41.3 percent from May 2009, far higher than any other submarket in the county.
“The growing shares of sales and relatively large increase in the high-end coast over the last year helps explain your 15.3 percent increase in the median,” LePage said.
But on a cost-per-square-foot basis, LePage said, many other neighborhoods also are doing better than a year ago. He had a one-word explanation: quality.
While 29.5 percent of homes sold last month had gone through foreclosure in the previous year, LePage said, that was the lowest percentage since November 2007. And many of the foreclosed properties are in better shape than previous foreclosures and thus command a higher price from buyers, who increasingly are owner-occupants, not investors.
“Some lenders are beginning to invest a little to attract buyers — new flooring, countertops,” LePage said. “It’s not to say there aren’t a lot of dilapidated foreclosures, but they’re likely better.”
Mark Marquez, president of the San Diego Association of Realtors, echoed LePage’s observation.
“We’re at a different place than we were in 2008 and 2009,” he said. “We don’t have the bank-owned (foreclosure) inventory we had.”
He said short sales — homes sold for less than the outstanding mortgage balance — represent about 50 percent of the market and also are in relatively good condition.
“They’re going to market with the grass cut and fence painted,” he said. “I think you will see people taking care of their neighborhoods. “I don’t think you’re seeing the blight in the neighborhoods you once were.”
The overall median price has now risen $60,000, or 21.4 percent from the bottom reached in January last year. But it is still off 34.3 percent from the peak, $517,500 in November 2005. The current median is comparable to where it was when the market was falling two summers ago.
The median for single-family resales was up even more than the overall market, and condo prices were doing even better. The new-home market was down, but that reflects a shift to smaller, lower-priced designs that builders are rolling out to compete with the discounted distressed market.
Overall sales in May were up 17.8 percent from April to 3,879 transactions, but analysts attributed this unusual boost to the delay in escrow closings from April as buyers sought to take advantage of the state homebuyer tax credit, which began May 1. The March-April sales increase had been only 2 percent, much lower than usual.
New home sales skyrocketed 67.7 percent from April to 332 closings, but that was still the third worst May in DataQuick’s 23 years of record-keeping.
“It certainly is down,” said Joyce Mason, a spokeswoman for Pardee Homes. “But relative to last year or the last six months, we’re starting to see some positive movement.”
Marquez, from the realty group, said resale condos are holding up in price, but only in buildings in which the homeowners association is financially stable. For about a third of condo listings, the associations are facing bankruptcies or huge shortfalls after owners stopped paying their assessments. But Marquez said investors increasingly are buying such units, paying the dues and putting the projects on the road to solvency.
While the first five months of the year have seen a turnaround in San Diego’s housing picture, it is unclear if the trend will continue at the same pace.
Robert Brown, an economist at Cal State San Marcos, said it’s possible many sales took place only because of the state and federal tax credits. If demand slackens in the second half of the year, prices could level off or go back down. But with interest rates at near-record lows — around 4.7 percent for 30-year, fixed-rate loans — buyers stand to gain from buying now, even without the credits, than later, when rates might be up, he said.
“The bottom line, I think, is that low rates may be the biggest positive tacked on” to market conditions, Brown said.
Roger Showley: (619) 293-1286; roger.showley@uniontrib.com
