Tuesday, June 19, 2012

The San Diego Union Tribune reported a "Blockbuster Month" in May with resales hitting the highest mark in nearly seven years.  Article below:


San Diego Union Tribune 06/14/2012, Page A01

SINGLE-FAMILY HOME RESALES AT 7-YEAR HIGH

LILY LEUNG •
U-T

Local real estate closed out a blockbuster month in May with single-family resales hitting the highest mark in nearly seven years, housing tracker DataQuick said Wednesday. Combine that faster sales pace with an increase in home prices, and some housing insiders say they believe a recovery is within the county’s grasp.

“We’re starting to see some people come out of the woodwork,” said Michael Lea, a San Diego State real estate professor. “A lot of people held off selling for a long time, and at some point, for a variety of reasons, people are now selling.”

San Diego County recorded a total of 3,750 sales last month, a 21.5 percent increase from a year ago and a 5.4 percent increase from April, said DataQuick, a La Jolla-based real estate information company.

The overall median price in May rose 3.2 percent from a year ago to $335,000, the highest it’s been in 18 months, when the median value also was $335,000.

Sales saw the most strength in the single-family resale slice, which makes up about two-thirds of total home sales. In this segment, buyers closed on 2,488 homes in May. That’s the highest figure for this category since September 2005, when 2,671 were sold, DataQuick numbers show. Those sales peaked at 3,307 in June 2005, when analyzing the current housing cycle of 2005 to present.

All of the county’s major regions showed increases in single-family resales compared to a year ago. The North County inland area, including neighborhoods like Escondido and western Rancho Bernardo, saw the most growth in this segment. More than 700 single-family homes were resold in that area last month, up 33.3 percent from a year ago.

San Diego real estate agent Michael Wolf said he has seen an increase in interest across the board, from residents who are tired of renting, to investors trying to find limited steals.

Wolf pointed to historically low mortgage rates as one of the biggest reasons potential buyers are starting to look. The 30-year fixed rate is at 3.67 percent, while the 15-year fixed rate is at 2.94 percent, according to Freddie Mac.

Another factor, Wolf said, is inventory. A recent snapshot taken by the San Diego Association of Realtors showed that the number of homes listed for sale in San Diego County has fallen to its lowest level in nearly three years. He said this has resulted in more competition, and at times, multiple bids for a single home.

Home sales also picked up across Southern California, especially in coastal regions, “where move-up markets have picked up steam,” Data-Quick reported.

More than 22 percent of Southern California sales in May were $500,000 and up. That share is up from 21 percent the previous month and a year ago, DataQuick analysts found.

“May’s share of sales above $500,000 was the highest since July 2010, when they also made up 22.4 percent of the market,” the report added. The low point was 13.8 percent in January 2009.

DataQuick analysts added two more factors that could explain May’s increase in sales and prices: •An extra business day this May.

•Fewer foreclosure resales and short sales. Their share of the market in SoCal fell to 44.8 percent, the lowest level in more than four years.

Do May’s numbers indicate that the market is bottoming out? “The market is being slowly nursed back to health by low interest rates, a modestly improved economy and, we suspect, a widening sense that the housing sector is at or near bottom,” said DataQuick President John Walsh, in a statement.

“There’s still plenty of uncertainty swirling around out there,” he added. “But it looks like more move-up buyers are concluding it makes sense in the long run to sell their homes now, even when it’s hard to swallow the price. The upside for many is a good deal on the next house, and the ability to lock in both a killer mortgage rate and a relatively low property tax base.”

lily.leung@utsandiego.com

(619) 293-1719 Twitter:@lilyshumleung The market is being slowly nursed back to health by low interest rates, a modestly improved economy and, we suspect, a widening sense that the housing sector is at or near bottom.”

John Walsh
DataQuick President
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