San Diego Housing Market Update for February 27, 2023
San Diego Housing Market Update for February 27, 2023
Pending home sales are seeing a RISE all across the country, including in San Diego.
According to Realtor.com contract signings continued to thaw in January, increasing 8.1% relative to December 2022, the largest monthly increase since June 2020. However, pending home sales were still down 24.1% compared to last January. By the end of January, the rate on a 30-yr fixed rate mortgage was 6.13%, the lowest level since mid-September 2022. However, home prices remained 8.1% higher than the previous year which, coupled with mortgage rates up more than 250 basis points in the same time period, meant that buyers were still positioned to pay much more for a home than a year prior. Despite ongoing affordability constraints, contract signings picked up in all regions, led by a 10.1% month-over-month increase in the West.
Here in San Diego, Pending homes are UP for single family homes. New listings have gone down, mostly due limited choices on where sellers can move next, and if they want to give up their low interest rates to buy another home.
New Home Sales Climb 7.2% from Revised Figure, Sale Price Drops
New homes sales climbed 7.2% in January. Home builders have begun to offer huge incentives to home buyers, such as mortgage rate buy downs, credits towards upgrades when buying a new home, and slashing prices of new homes in San Diego.
Buyer beware when buying a new home in San Diego. The sales person at the new home sales office works for the builder, not for you. Their job is to sell you a home that makes the builder the most amount of money. In my experience, having your own agent to represent you and negotiate more incentives on your behalf can benefit you greatly and cost you nothing.
Redfin Housing Market Data
In January 2023, U.S. home prices were up 1.5% compared to last year, selling for a median price of $383,249. On average, the number of homes sold was down 33.9% year over year and there were 273,694 homes sold in January this year, down 414,247 homes sold in January last year. The national average 30 year fixed rate mortgage rate is at 6.3% and up 2.8 points year over year according to Redfin.com
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Housing Market Predictions- Highly Volitile
The housing market is heating up. Mortgage rates have risen back over 6.5% this past week and experts believe that the new “normal” for interest rates will be at least 5%. Inflation remains a key factor, with consumer spending continuing to rise; however if it can be tamed soon mortgage rates could fall below 6%. It’s clear that keeping an eye on inflation in 2021 is going to determine how high or low your house payment ends up being!
My advice. If you are thinking about buying a home, getting preapproved is fast and easy. Once you have your preapproval you can quickly make a purchase on a home when the rates drop.
