Despite a downturn in 2014, the housing market recovery could regain momentum in 2015 if employment growth continues to bolster household incomes.
In the San Diego region, more than 41,000 jobs were added within the last year, with the largest growth in biotech, engineering and other professional services. These high-paying fields have drawn more people to the area who can afford the newest houses on the market, according to The San Diego Union Tribune.
However, the imbalance remains between accelerated housing demands for summer and a lack of inventory of available homes. Experts cite a healthy inventory level at five to six months, but the San Diego Association of Realtors (SDAR) projects stock in the county is currently at about two and a half.
“The real estate market is hot,” said Juana Castro, a Realtor at Coldwell Banker. “It’s a seller’s market. Sellers will be experiencing multiple offers in market times of 14 days or less. This is high season for buyers to shop for a home.”
The median sale price of previously owned homes rose six percent in May, averaging at $530,000, according to the San Diego Business Journal. Condominiums also increased by six percent, to $348,000.
“Homes are selling within 30 to 60 days,” said Cara Treder, a Realtor at California Oak Realty. “In other parts of the country, it could take a few months to close.”
A study by Harvard University’s Joint Center for Housing Studies shows home ownership fell to 53% in San Diego County in 2013 and continues to trail the national average of 64.5 percent.
Frank Grangetto, Owner of Grangetto Group Real Estate, said intense market competition has pushed some sellers to price their homes significantly above recent sales, while more informed buyers aren’t willing to make the mistake of over paying for a home.
In this environment, Grangetto said buyers may miss out on properties they really want to more aggressive buyers.
When looking for a home, preparing ahead of time with a defined budget and list of desired locations will pay off, said Treder. Real estate agents will be able to target listings specific to buyer criteria as soon as they become available.
Top 5 Tips for Summer Home Buyers:(Compiled by Juana Castro)
1. Buyers should talk to their boss about flexible hours so they can shop for homes during the work week.
2. Buyers should get pre-approved with a lender, not just prequalified. A pre-approval letter may help the strength of your offer.
3. Buyers should have their lender and real estate agent help them determine what cash is needed for the transaction. Have your agent attach proof of funds with the offer.
4. Make the offer as clean and aggressive as possible. Shorten timelines whenever possible on the contract.
5. If it is a traditional sale (not bank owned, short sale or investor owned), the buyer should write a compelling letter about themselves describing why they want to be the new home owner of the property. Accompany the letter with a picture of the buyer.