S.D. home prices up 12.4% in May

BY JENNIFER DAVIES, UNION-TRIBUNE STAFF WRITER

ORIGINALLY PUBLISHED JULY 27, 2010 AT 6:49 A.M., UPDATED JULY 27, 2010 AT 2:58 P.M.

San Diego home prices increased 12.4 percent in May from a year ago and San Diego was the only metro area in the country with 13 months of consecutive increases in home prices, says the latest Standard & Poor’s Case-Shiller Home Price Index released Tuesday.

San Diego’s increase was the second highest of the 20 metro areas surveyed, with San Francisco taking the top spot with an 18.3 percent increase.

On a monthly basis, San Diego saw its home prices increase 1.1 percent. Since spring is one of the busiest times for home selling, Case-Shiller also provides seasonally adjusted numbers, which showed San Diego with a slightly lower increase at 0.6 percent.

On a nationwide level, prices in the 20 metro areas Case-Shiller tracks were up 4.6 percent from May 2009.

Despite the increases, there are plenty of reasons to be pessimistic about the housing market for the rest of the year.

While prices nationally have improved from the lows hit in April 2009 — San Diego hit its Case-Shiller low in May 2009 — they’ve essentially been flat for much of the past seven months. According to Case-Shiller’s index, home prices in San Diego are at about the same level they were in June 2003.

Maureen Maitland, vice president of Index Services at Standard & Poor’s, said the end of tax credits and the busiest home-buying season means there is little else to prop up home prices.

“Sure, April and May look good. But you have to look at the trends,” she said. “Going forward, all bets are off. You need true economic recovery for the housing market to be sustained.”

Kelly Cunningham, an economist with National University System Institute for Policy Research, said he doesn’t foresee the San Diego region going through another gut-wrenching drop in housing prices but he also doesn’t see any eye-popping gains, either.

“It’s going to be kind of stagnant is the best way to put it,” he said.

Still, stagnant might not be all that bad when compared to other parts of the country. San Diego and other California cities have been performing better than their counterparts in the Sunbelt because they didn’t go through frenzied building sprees during the bubble.

“In coastal California, we have constrained housing development,” Cunningham said. “It comes back down to supply and demand. We don’t have the problems that Las Vegas, Phoenix or even Riverside have.”

Jennifer Davies: (619) 293-1373; jennifer.davies@uniontrib.com

Home sales in S.D. fall in June

Federal tax credit ends; median price in county climbs

BY JENNIFER DAVIES, UNION-TRIBUNE STAFF WRITER

ORIGINALLY PUBLISHED JULY 23, 2010 AT 9 P.M., UPDATED JULY 24, 2010 AT 12:02 A.M

With the federal tax credit expiring, homes sales were down in June but prices continued to rise in San Diego, according to the California Association of Realtors.

In San Diego, the median price for June was $397,910, a 1.7 percent increase from the previous month and a 9.7 percent increase from the previous year. Home sales in the county dipped 4.1 percent from May but were up 1.1 percent from a year ago.

On the state level, the median home price for June stood at $311,950, a decline of 3.8 percent from the previous month but up 13.6 percent from the previous year. Home sales were down 11.1 percent from the previous month and down 4.2 percent from last June.

Steve Goddard, president of the California Realtors Association, acknowledged that the end of federal tax credits were having an effect on home sales, which could continue for the rest of the year.

“Although we expect sales to be lower in the second half of the year because of the absence of the government stimulus, they should remain above the long-run average and be significantly higher than the trough in 2007, when sales bottomed out,” he said.

According to the California Association of Realtors, San Diego hit its trough price of $326,830 in March 2009. While the median price in San Diego is now 21.7 percent higher than that low, it is still far off its peak of $622,380 in May 2006.

Jennifer Davies: (619) 293-1373; jennifer.davies@uniontrib.com

KCM Quick Report

KCM Quick Report

San Diego foreclosures lowest in 3 years

BY DEAN CALBREATH, UNION-TRIBUNE STAFF WRITER

WEDNESDAY, JULY 21, 2010 AT 1:16 P.M.

San Diego County had fewer mortgage defaults and foreclosures in the second quarter than it has had in the past three years, according to a report released today by MDA DataQuick, a real-estate research firm based in La Jolla.

Countywide, 5,458 homes went into default during the second quarter, a 45 percent drop from the total of 9,866 during the same period of last year. That’s the lowest number since the second quarter of 2007, just as the county was slipping into recession.

Foreclosures dropped 6 percent from 3,518 in the second quarter of 2009 to 3,315.

The same trend is showing up throughout California, with the number of defaults dropping for five consecutive months, resulting in a 44 percent year-to-year drop. Foreclosures, however, rose by 4 percent, driven partly by jumps in relatively pricy neighborhoods in Orange County, San Mateo , Marin, Los Angeles,Santa Barbara and San Franciscocounties.

John Walsh, DataQuick’s president, said there were several reasons for the decline in defaults, including “motivated sellers and accommodating lenders” who have been doing more short sales; public policy, including tax incentives for homebuyers; and a rise in prices over the past year.

Walsh said that if prices continue to rise, “fewer homeowners will find themselves under water, which is a significant factor in letting a home go.”

Out of the 85 ZIP codes in the county, only two had a rise in defaults: Coronado and Del Mar. Two others had the same number this year as last year: BorregoSprings and the area around Rancho Santa Fe’s post office. Except for Borrego Springs, those neighborhoods are among the priciest in the county, with median home prices above $1 million.

DataQuick noted that statewide, mortgage defaults spread from lower-cost markets into more expensive neighborhoods, although that trend appears to be leveling off.

Dean Calbreath: (619) 293-1891; dean.calbreath@uniontrib.com

Housing improves to 'somewhat out of kilter'

First-time tax credits helped increase sales

BY MIKE FREEMAN, UNION-TRIBUNE STAFF WRITER

TUESDAY, JULY 13, 2010 AT 8:21 P.M.

Southern California market

All Homes	#Sold June-09	#Sold June-10	Pct. Chng	$Median June-09	$Median June-10	Pct. Chng
Los Angeles	7,636	7,849	2.8%	$320,000	$335,000	4.7%
Orange	2,958	3,423	15.7%	$418,000	$445,000	6.5%
Riverside	4,694	4,645	-1.0%	$185,000	$210,000	13.5%
San Bern.	3,438	3,179	-7.5%	$140,000	$160,000	14.3%
San Diego	3,692	3,885	5.2%	$314,250	$335,500	6.8%
Ventura	844	890	5.5%	$365,000	$384,000	5.2%
Southern Calif.	23,262	23,871	2.6%	$265,000	$300,000	13.2%

JUNE HOUSING PRICES FOR SAN DIEGO COUNTY

Median prices	June ’09	May ’10	June ’10	Change June ’09-10
Resale houses	$350,000	$377,000	$380,000	8.6%
Resale condos	$210,000	$235,000	$219,250	4.4%
New homes/condos*	$455,500	$399,000	$431,000	5.4%
Combined	$314,250	$340,000	$335,500	6.8%
Sales	June ’09	May ’10	June ’10	Change June ’09-10
Resales houses	2,299	2,335	2,301	0.1%
Resale condos	1,101	1,212	1,163	5.6%
New homes/condos*	292	332	421	44.2%
Combined	3,692	3,879	3,885	5.2%

While Southern California’s housing market isn’t in good shape, it has been gradually improving over the past year. Now housing experts are asking whether the market is healthy enough to continue progressing on its own.

The next couple of months will go a long way toward providing an answer, said John Walsh, president of industry research firm MDA/DataQuick.

Tax credits for first-time homebuyers officially expired in April, but buyers still could get the credit as long as their purchase was completed by the end of June. That helped spur sales activity throughout Southern California last month, according to DataQuick.

“More money was spent last month buying homes in Southern California than in the past two years, and more money was loaned,” said Walsh. “The tax credits had something to do with that, though it’s not clear exactly how much. With the impact of the credits fading fast, the next few months will tell us a lot.”

Although Congress extended the deadline for sales to be completed until the fall, in part because foreclosures and short sales often drag out for months, the tax credit benefit on the overall market is probably limited going forward.

That could create a headwind for housing this summer and fall. “We’ve already seen it,” said Kevin Parra, president of Plaza Home Mortgage in San Diego. “Our refinance business is up, but the purchase business has dropped off noticeably.”

Last month, 23,871 new and resale homes sold in the six county Southern California region. It was the strongest June for the sheer number of sales since 2006.

The median price of $300,000 in June marked a 13.2 percent improvement over June 2009.

“The market was wildly out of kilter a year ago,” said Walsh. “Now it’s just somewhat out of kilter. We’re still seeing a lot of bargain hunting, and we’re not seeing much discretionary buying.”

How far is the market from normal? Consider:

• Recent foreclosures made up 33 percent of June sales, excluding new homes, in Southern California. The monthly average for foreclosure sales is 15.2 percent, based on DataQuick’s records dating to 1995. Foreclosure sales peaked at 56.7 percent of purchases in February 2009.

• Sales of high-priced homes — those $500,000 or more — made up 20.8 percent of purchases last month, compared with an average of 40.6 percent over the past decade.

• Absentee buyers, mostly investors but some second homebuyers, bought 19.7 percent of homes last month. Over the past decade, absentee buyers have made up 15.8 percent of purchasers on average.

According to Walsh, the single biggest issue holding back housing — particularly for high priced homes — is the availability of mortgages.

“Rates may be at record lows, but that doesn’t mean much if the lender won’t qualify you.” he said.

Only 6.6 percent of Southern California buyers took out adjustable rate mortgages to buy a house last month, according to DataQuick. Historically, 43.9 percent of the region’s home purchase mortgages since 2000 have been adjustable rate loans.

Jumbo loans — usually used by buyers of expensive homes — accounted for 17.3 percent of Southern California mortgages last month, compared with nearly 40 percent in 2007 at the height of the most recent housing bubble.

For comparison purposes, DataQuick calculates jumbos as mortgages above $417,000, which previously was the threshold for jumbo loans before lawmakers raised the limit in certain high-priced states.

Parra of Plaza Home Mortgage offers a jumbo loan at 4.75 percent with points and fees. To get this loan, though, borrowers must have a high credit score, at least 20 percent down payment and enough cash reserves in the bank to cover 12 months of mortgage payments.

It’s a rare borrower who meets those requirements, he said. “It’s not so much the pricing or availability, it’s the tight credit,” he said. “I think there is demand. It is just very difficult to qualify.”

Home prices in San Diego County take a breather

BY LORI WEISBERG, UNION-TRIBUNE STAFF WRITER

ORIGINALLY PUBLISHED JULY 12, 2010 AT 12:08 P.M., UPDATED JULY 12, 2010 AT 6:04 P.M.

MEDIAN HOME PRICE

	Jun-09	May-10	Jun-10	Change from June 2009
Single-family resale	$350,000	$377,000	$380,000	8.6%
Condo resale	$210,000	$235,000	$219,250	4.4%
New home	$455,500	$399,000	$431,000	5.4%
County	$314,250	$340,000	$335,500	6.8%

.

HOME SALES

	Jun-09	May-10	Jun-10	Change from June 2009
Single-family resale	2299	2335	2,301	0.1%
Condo resale	1,101	1,212	1,163	5.6%
New home	292	332	421	44.2%
County	3,692	3,879	3,885	5.2%

San Diego County’s rapid run-up in home prices over the last few months took a breather in June, as sales activity remained relatively flat, although still more robust than earlier this year, MDA DataQuick reported Monday.

June’s median price of $335,500 slid 1.3 percent from the May figure of $340,000, while just a month earlier the median, or the midpoint of all prices, had jumped sharply. But compared to a year ago the June median was up 6.8 percent and represents the ninth straight month of year-over-year increases.

Meanwhile, last month’s sales tally of 3,885 homes and condos marked the highest June in four years, although DataQuick pointed out that it was still 17 percent below the average activity for that month since the company began tracking the market in 1988.

The recent flurry of activity in the housing market had been fueled in part by a June 30 deadline for securing a lucrative federal tax credit available to both first-time and repeat buyers. Although the deadline for closing purchases has since been extended to Sept. 30, buyers had to have contracted to purchase their homes by April 30.

Some experts believe that sales and prices will taper off in the coming months once the more high-volume summer buying season comes to an end and the effect of the federal credit wanes.

“I don’t see a big sales drop. There will be a small dip in the median price but nothing to worry about,” said Mark Marquez, president of the San Diego Association of Realtors. “We still have a solid base of buyer activity, but it won’t be at May and June levels. It’s not as brisk because there are no deadlines to rush to meet. We are seeing a rise in inventory, and people will probably negotiate harder, and they have time to do so.”

According to the San Diego Association of Realtors, active listings on the market stood at 12,047 as of Monday, up from 9,209 a year ago.

Among single-family resales, prices did climb last month, rising nearly 1 percent to $380,000, the highest since July of 2008, when the median-priced home sale was $399,000.

Also showing a monthly uptick were new home prices, which rose from $399,000 in May to $431,000 in June, although the median price was down 5.4 percent from June a year ago. Sales of newly built homes surged more than 44 percent compared to a year earlier and were also up significantly from May, influenced, at least in part, by buyers rushing to nab the tax credit.

Expect the market, though, to remain relatively sluggish in the coming months as the stimulus from the tax credit starts to fade and economic worries persist, say analysts.

“Right now, I don’t see any reason to see a big surge in sales, just a very slow recovery based on the economic signals we have now,” said Norm Miller, a University of San Diego economist and Co-star Group vice president. “But if you can jump into the single family market now, you can’t do any better. Prices are not likely to go down, and interest rates are so low.”

Although the mix of housing that has sold over the last year has become more diversified, with sales of higher end homes picking up, the greatest appreciation during the last quarter appeared to be concentrated in the county’s lower priced neighborhoods, DataQuick statistics show.

In the second quarter, for instance, the median price for single-family resales was up 38.3 percent in Spring Valley and 25.9 percent in Logan Heights, while Solana Beach saw a 28.6 percent drop, compared to a year earlier. However, some pricier upscale neighborhoods did fare better than others, such as Del Mar, where the median home price shot up 18.3 percent to $1.3 million.

While sales of distressed properties continue to play a significant role in the housing market, their share continues to fall as the supply of foreclosed homes diminishes. The proportion of the resale market made up of homes foreclosed on in the prior 12 months slid last month, down to 28.4 percent, compared to 38.6 percent a year earlier, making it the lowest since November of 2007, according to DataQuick.

“Home values going forward will depend on how lenders handle the remaining distress out there,” said DataQuick analyst Andrew LePage. “My sense is if there are not a lot changes in the economy and the level of foreclosures sales doesn’t rise, prices will be pretty flat through the end of the year. It looks like we’re in a period of stagnation that normally follows a large decline.”

Lori Weisberg: (619) 293-2251; lori.weisberg@uniontrib.com