Monday, April 22, 2013

San Diego County Real Estate Market 2012 vs. 2013


There have been several articles released lately regarding the real estate market specifically how much homes has gone up. These articles typically use the median, which is the middle value. For example if one year four $300,000 homes are sold along with three $600,000 homes the median value is $300,000. If the following year three $300,000 homes are sold along with four $600,000 homes the median value is $600,000, which is an increase of 100%. Knowing this I don't believe the median number is good to use for real estate since every home is unique. The median number from one period of time compared to another usually show large changes in the market, which is probably why writers like to use it because is shows volatility.

I find using the average cost per square foot is a much more accurate number to use to show the direction of the market but it is not perfect as it does not take into account the size of the land. With this in mind I decided to look at the real estate market in San Diego County for homes sold in the first three months in 2012 and compared them to the first three months of 2013. Another criteria I used was to limit the price of the sold homes to under $2,000,000 for two reason. First, most people do not buy homes in the multi dollar range. Second, there was some anomalies in the high range of $12 and $14 million homes sold. The data comes from the MLS (Multiple Listing Service) and first time buyers are purchases that used a FHA or VA loan, which are loans that only first time buyers can use. There are some first time buyers who probably put down 20% but not many.

In the first three months of 2012 (7433) homes were sold. The average price per sqft was $220.23. Of those homes 2092 were purchased with cash while 2100 were first time buyers.

In the first three months of 2013 (7956) homes were sold. The average price per sqft was $256.27. Of those homes 2368 were purchased with cash while 1792 were first time buyers.

Using the price per sqft homes in the San Diego County market increased 16% in one year and purchases by investors also increased.

Encinitas, La Jolla and Downtown San Diego are areas that tend to have the most transactions so I looked at the numbers for those areas.

Encinitas
In the first three months of 2012 (126) homes were sold. The average price per sqft was $343.15. Of those homes 33  were purchased with cash.

In the first three months of 2013 (142) homes were sold. The average price per sqft was $383.41. Of those homes 39 were purchased with cash. An average increase in price of 12%.

La Jolla
In the first three months of 2012 (127) homes were sold. The average price per sqft was $508.61. Of those homes 51  were purchased with cash.

In the first three months of 2013 (153) homes were sold. The average price per sqft was $540.45. Of those homes 68  were purchased with cash. An average increase in price of 6%.

Downtown San Diego
In the first three months of 2012 (195) homes were sold. The average price per sqft was $377.11. Of those homes 88  were purchased with cash.

In the first three months of 2013 (219) homes were sold. The average price per sqft was $440.07. Of those homes 82  were purchased with cash. An average increase in price of 17%.


www.877homes.com

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