San Diego Real Estate and Community News

Aug. 31, 2022

Home Buyers Regain Some Negotiating Power

There's a reason it's called a seller's market. When there are too few homes for sale and plenty of buyers, home seller's set the terms. Take last year, for example. In the frenzy of last year's housing market, home buyers were waiving inspections and even buying homes sight unseen. Home sellers didn't have to negotiate to get a buyer to sign a contract, they could simply wait for a better offer. This year, though, things may be changing. According to the National Association of Realtors' consumer website, recent buyers have been having success negotiating terms with home sellers. Survey results show the number of buyers asking for repairs based on the inspection has more than doubled over the past 12 months, while the number of sellers refusing to make repairs has dropped to zero. Additionally, the share of sellers who have sold below their asking price has risen from 18 percent in February to 31 percent in July. George Ratiu, manager of economic research for the NAR's website, says things are getting back to normal. “Our survey shows that the overheated housing market of the past two years, which predominantly favored sellers, is beginning to regain a sense of normalcy, which is welcome news for home buyers,” Ratiu said. (source)

Aug. 29, 2022

Contract Signings Fall But Less Than Month Before

Measuring the number of contracts to buy homes signed in a given month will give you a good idea of what the following month's home sales numbers will look like. After all, signing a contract to buy is the first step in a closing process that usually lasts a few weeks. Which means a signed contract today will be a closed home sale in about a month. It also means The National Association of Realtors' Pending Home Sales Index can give us an early insight into what's happening in the housing market now. The NAR's most recent release says contract signings fell 1 percent in July. But while the decline indicates the market is still slowing, the rate of decline improved greatly from the previous month, according to the new numbers. In fact, the previous month's index saw an 8.6 percent drop. Lawrence Yun, NAR's chief economist, says the market should soon begin to stabilize. “Home prices are still rising by double-digit percentages year-over-year, but annual price appreciation should moderate to the typical rate of 5 percent by the end of this year and into 2023,” Yun said. “With mortgage rates expected to stabilize … alongside steady job creation, home sales should start to rise by early next year.” (source)

Aug. 26, 2022

Typical U.S. Home Value Sees Small Decline

Home values have been rising steadily for years now. The pandemic caused them to accelerate, but it's not as though they just start increasing two years ago. In fact, according to one monthly measure, there hasn't been a month when they haven't increased since 2012. There were times, of course, when the increases would slow, but no month in the past 10 years saw the typical home value decline month over month. It did in July, though, falling 0.1 percent from the month before. The typical home, according to the numbers, now costs $357,107 - $366 less than it did in June. The improvement was small, but still encouraging for buyers shopping for a home in a tight market. It also follows a trend. The typical home value has been slowing for a few months now, after peaking in April. Month-over-month growth was near 2 percent earlier in the year and had slowed to 0.8 percent by June. It's just another sign that the market is rebalancing, with buyer demand slower than before and the number of available homes rising. (source)

Aug. 24, 2022

Market For Smaller Homes Remains Competitive

The housing market has gotten a little easier for buyers lately. Listings are lasting longer and home-price increases have slowed. It's definitely still a seller's market, but buyers have it easier than they did last year at this time. Of course, how much easier depends on where and what you're looking to buy. Conditions can vary from one neighborhood to the next. They can also vary depending on price range. In fact, according to one recent report, if you're shopping for something smaller and more affordable, you're going to find more competition among buyers than you would if you were shopping for something larger and more expensive. Why? The answer is inventory. While the number of homes for sale has been growing lately, the inventory of affordable homes has been growing at a slower rate than the inventory of higher priced homes. At the high end of the market, inventory is up 19.3 percent from where it was last year. The inventory of affordable homes, on the other hand, grew just 10.4 percent over the past 12 months. In other words, buyers looking for something more affordable should still prepare for a competitive market, even if it's slower than last year's. (source)

Aug. 22, 2022

Existing Home Sales Fall In July

Sales of previously owned homes fell 5.9 percent in July, according to new numbers from the National Association of Realtors. The decline continues a downward trend that began earlier this year, when mortgage rates increased after years of hovering just above, or at, record lows. Lawrence Yun, NAR's chief economist, says sales have fallen but that doesn't necessarily mean prices have. “We're witnessing a housing recession in terms of declining home sales and home building,” Yun said. “However, it's not a recession in home prices. Inventory remains tight and prices continue to rise nationally with nearly 40 percent of homes still commanding the full list price.” Tight inventory also means prospective home buyers still need to be ready to act fast when they find a home that fits their needs. The NAR says the typical property was on the market just 14 days in July, with 82 percent of homes selling in less than a month. (source)

Aug. 19, 2022

Buyers Say They Had To Compromise On Wish List

Buying a house means setting priorities. More than likely, you won't find one that checks off every single item on your wish list. So you're going to have to prioritize and choose which features are most important to you and which you can live without. You're also going to have to compromise. According to one recent survey, most home buyers do. In fact, the survey found 80 percent of recent home buyers said they had to compromise on their priorities. That means giving up something that made their wish list and buying a house that had most, but not all, of their desired features. For example, among survey respondents who compromised, 20 percent said they settled on neighborhood and bought in an area that wasn't their top choice. But despite the vast majority of recent buyers saying they made compromises, their top regrets weren't about features they had to do without. In fact, recent buyers said their biggest regrets were spending too much and buying too quickly, both common problems during last year's frenzied market. (source)

Aug. 17, 2022

Home Builders Cut Prices On New Homes

New homes are generally more expensive than previously owned homes. That's not surprising. Anything brand new typically costs more than something used. But if you're a prospective home buyer who's been reluctant to consider buying a new house because of the price tag, the latest Housing Market Index from the National Association of Home Builders has good news for you. The index – which is based on a monthly survey of home builders – found one in five say they've reduced their prices in the past month. Of course, the reason they've cut their prices is because affordability conditions have gotten more challenging this year. Elevated prices and rising mortgage rates reduced the number of buyers active in the market. However, for buyers who've remained active, price cuts could be an opportunity. Robert Dietz, NAHB's chief economist, says buyers may see more stability in the months ahead. “As signs grow that the rate of inflation is near peaking, long-term interest rates have stabilized, which will provide some stability for the demand-side of the market in the coming months,” Dietz says. (source)

Aug. 15, 2022

Is Relief Ahead For Home Buyers?

A new quarterly report from the National Association of Realtors found the median home price reached a new record high during the second quarter. By the end of June, it was up to $413,500. That's after the vast majority of metro areas saw double-digit price gains from the year before. Put simply, it got more expensive to buy a home this spring. But though buying got more costly during the first half of the year, could the second half of the year bring buyers some relief? Maybe, according to Lawrence Yun, NAR's chief economist. Yun says buyers may begin to see affordability conditions improve soon, as the market finds better balance. In fact, prices and rates have both gotten more favorable in recent days. “Overall, the national price deceleration inevitably followed the softening sales, providing well-positioned buyers a small measure of welcomed relief,” Yun said. “The recent dips in mortgage rates will bring additional buyers to the market, especially in those places where home prices are still relatively affordable and where jobs are being added.” In other words, home price increases have already begun to slow and, with mortgage rates down from where they were earlier this year, home buyers may begin to see a little relief, after a challenging first half of the year. (source)

Aug. 8, 2022

Nearly Half Of All Homes Are Equity Rich

Equity is the difference between what your home is worth and what you owe on your mortgage. Which means, it's a good thing to have – and, these days, nearly half of all homeowners do. In fact, according to ATTOM Data Solutions' second-quarter 2022 U.S Home Equity & Underwater Report, 48.1 percent of mortgaged residential properties are now considered equity rich - meaning the amount homeowners owe on their home is less than 50 percent of the home's market value. The share of equity-rich homes is up from 34.4 percent last year at the same time and 44.9 percent during the first quarter of this year. Rick Sharga, executive vice president of market intelligence at ATTOM, says homeowners will continue to make gains, even as the market slows. “While home price appreciation appears to be slowing down due to higher interest rates on mortgage loans, it seems likely that homeowners will continue to build on the record amount of equity they have for the rest of 2022,” Sharga said. As it is, the percentage of equity rich homes is now the highest its ever been. (source)

Aug. 3, 2022

Is It Still A Good Time To Sell A Home?

The past couple of years have been good to home sellers. A historically low number of homes for sale combined with elevated demand from buyers made conditions perfect to sell a home quickly and for a great price. But this year, things have been changing. The housing market has begun to cool. The number of homes for sale has started to rise while buyer demand has slowed. So is it still a good time to sell a home? Well, according to new numbers from ATTOM Data Solutions it is. Their quarterly 2022 U.S. Home Sales Report found profit margins on median-priced single-family homes hit another record high during the second quarter. In fact, the typical home sold during the second quarter generated a profit of $123,869, that's up from $103,750 during the first quarter and $90,000 last year at the same time. Rick Sharga, ATTOM's executive vice president of market intelligence, says it's still a good time to sell. “Home sellers in the second quarter continued to benefit from the rapid growth in home price appreciation the country has experienced over the past few years,” Sharga said. “While price growth may slow down as higher mortgage rates dampen demand from prospective home buyers, home sellers should continue to profit from the record $27 trillion in homeowner equity in today's market.” (source)