San Diego shows strong economy
Recent reports have indicated that San Diego's housing market is in recovery and home prices are on the rise. People who are considering investing in real estate in San Diego have yet another positive report to boost their confidence. KPBS recently cited an index of San Diego County's leading economic indicators done by the University of San Diego Burnham-Moores Center for Real Estate. The index revealed that San Diego's leading economic indicators increased by 0.6 percent in September.
"The report, called the San Diego index of Leading Economic Indicators, shows that the region's economy has been positive in all but three months since September 2011," reported local news source North County Times. "It concludes that the economy is sound."
The index previously fell by 0.1 percent from July to August, landing at 121.6 percent before it rebounded in September, back to 122.3. The index examines unemployment insurance filings, approved building permits, stock prices for local companies and the number of job postings that are advertised online. The index has been done since 1991 and reached its record recession-related low of 100.69 in March 2009.
Building Permits in San Diego
The index revealed that building permits were up 1.35 percent in September from August, marking the seventh month in a row that the number of issued building permits increased. KPBS reported that the number of residential building permits were 14.6 percent higher in September 2012 than they were in September 2011.
North County Times cited a news release from the University of San Diego that indicated that the boost in building permits can be attributed to multifamily housing units. In the third quarter of 2012, multifamily housing units increased by 27.7 percent. The release did, however, indicate that single-family homes decreased by 4.1 percent in the third quarter.
San Diego's inventory of homes still low
While the recent index revealed a boost for building permits, there is still a low housing inventory. In fact, the rise in local housing prices is often attributed to the increasingly limited inventory of homes.
In a recent article in the San Diego Union-Tribune, real estate journalist Lily Leung collected advice from 10 real estate experts on how to increase the local inventory.
"The most effective way to increase inventory levels is to give the housing market time to stabilize and correct itself," said one local expert Patricia Kramer. "Increasing the number of homes [on the] market will drive the prices even lower than they are today. Inventory levels will increase when sellers have a compelling reason to sell."