San Diego luxury home prices on the rise
According to the First Republic Prestige Home Index, luxury home values in the major metropolitan markets of California rose in the second quarter of 2012 by comparison to a year ago. The index was compiled by First Republic Bank, a private bank and wealth management company, and revealed that in San Diego, the average luxury home is valued at $1.65 million, which represents a 2.5 percent year-over-year gain in the second quarter of 2012. Those looking at luxury homes for sale in San Diego could find the results of the index particularly valuable.
President and COO of First Republic Bank Katherine August-deWilde said in the report, "The luxury home market continued to improve in the second quarter, with some neighborhoods experiencing strong price appreciation and accelerating interest from homebuyers." She added, "During the first half of 2012, buyers were motivated by a lack of supply and very low interest rates."
San Diego luxury home prices declined slightly in the second quarter of 2012 when compared with the first. However, looking at the year-over-year gain, the index showed the biggest annual gain since the first quarter of 2007.
One California real estate expert quoted in the press release announcing the index results spoke about La Jolla in San Diego County, revealing that there is only a small supply of available homes, and that buyers are eager to make offers. Expanding on the idea, the expert said, "There is more demand for fewer homes. Properties under $4 million are moving, but over $4 million, it is flat. This year, the amount of inventory is much less than last year."
Another recent article, in the San Diego Union-Tribune, commented that summer 2012 will be remembered by homeowners as "the year to buy." With recent reports detailing that inventory of available homes in San Diego continues to substantially decrease, and the new index revealing that luxury homes are experiencing a surge in pricing, those looking at real estate in San Diego may want to expedite the process and get into the market while they still can.
Another trend that goes hand-in-hand with an improved housing market is the economic state of the region. A report on August 17 in the North County Times revealed that unemployment rates declined in July. As the economic conditions in San Diego continue to improve, the housing market should become increasingly competitive.