San Diego housing market gains and enters recovery
People looking to purchase real estate in San Diego can examine numerous positive market reports to reinforce this decision. Many national studies paint an overall positive picture for U.S. housing market recovery, with several of them making special note of San Diego's improvement and desirability.
What recovery looks like
In a recent article from Global Property Guide, the U.S. housing market recovery was broken down into a number of noteworthy points. The source revealed that across the nation, home prices are on the rise, demand for properties has returned to the market and construction activity has been picking up steam. Additionally, the delinquency rate is stabilizing and the rate of foreclosures is decreasing.
The source indicated that during the housing market boom from 1996 to the first quarter of 2006, all 20 of the top U.S. metros observed astounding gains in home prices. During this time, San Diego registered the second biggest house price rise of 250.1 percent, outpaced only by Los Angeles, which observed an increase of 268.1 percent. In the second quarter of 2006, the housing bubble began to show signs of weakness, and then the all but inevitable burst occurred. From the second quarter of 2006 to the fourth quarter of 2011, the San Diego metro experienced a devastating fall from its place near the top of U.S. housing markets. The source indicated that San Diego registered a drop of 39.9 percent in home prices.
Over the last year, markets across the country have begun to show substantial signs of recovery. While the San Diego metro saw house prices drop by 5.4 percent in 2011 year-over-year, in August of 2012, San Diego was noted as back on top with a house price change of 1.9 percent year-over-year.
Even in the course of the last few months, San Diego and housing markets across the state of California have been hot topics of positive real estate news. San Diego has observed such success that its inventory of homes for sale is noted to be among the lowest markets in the country. In a recent article for the Wall Street Journal, as of the third quarter of 2012, San Diego has only a 3.2 months' supply.
Other contributors to San Diego's recovery
According to the article from Global Property Guide, the significant rise in demand for houses is worth noting. In the Western region of the country alone, sales have increased by 37.6 percent in the first three quarters of 2012 compared with the same period from 2011. The source also indicated that residential construction has begun a slow incline across the country.
San Diego's foreclosure activity is also impressive, particularly as a stabilized residential real estate delinquency rate is often explicitly linked to housing market recovery. The source indicated that in the third quarter of 2013, the San Diego metro observed a substantial drop in foreclosure activity, decreasing by 26 percent from a year earlier.
"The question is whether the housing recovery will continue to power growth, despite all [the economic pressures]," wrote Global Property Guide. "In our view the likely answer is, yes. A house price collapse created the recession. A continued recovery is likely to pull the U.S. out of recession. It is important not to underestimate the significance of the housing market as a major influence on the U.S. economy. We believe that the housing market is in strong recovery, and that it will pull the U.S. economy up with it."