San Diego Economic Forecast Conference - Residential Real Estate

If you missed the recent San Diego Economic Forecast Conference produced by Beacon Economics, fear not!  As part of its ongoing association with these economists, MetroIntelligence authored the residential real estate section for the conference book given out to attendees at this event, which took place on October 3rd at the Hilton San Diego Bayfront Hotel.

Following are some of the key findings:

• Lower home prices continue to support higher affordability versus the boom years, with 54% of households able to buy the median-priced home at current interest rates; this index is now where it was in both late 2009 and late 2002.   
• Although the S&P/Case Shiller index in May was still lower than a year ago, since the beginning of 2012 it has began to slowly rise, and is about where it was in both late 2009 and late 2002.
• New home sales remain depressed, with sales in the second quarter of 2012 down by 82% from the peak of early 2005; still, over the previous year sales did rise by about 3% while prices fell by a similar amount to $437,148.
• Sales of existing single-family homes in the second quarter of 2012 rebounded by 17% over the previous year versus less than 10% statewide; despite the increases, sales prices rose by just 0.7% to nearly $360,000 versus 8% statewide.
• Condo sales in the second quarter of 2012 rose at about the same rate of new homes over the previous year, or just over 3% to about 2,700 units versus an 11% rise statewide; sales prices rose by 4.7% to over $220,000 versus 6.8% statewide.
• Given its combination of low vacancies and positive rental growth, San Diego’s apartment market is among the strongest in the country; during the second quarter of 2012 vacancy rates were at about 3% with asking rents rising by 2.5% over the past year to $1,384 per month.
• Foreclosure activity in the second quarter of 2012 showed sharp declines, falling by nearly 50% over the previous year to 1,325 units, or where it was in the second quarter of 2007; loan defaults also fell by nearly 24% over the previous year to about 4,200 units.
• Permits for new single-family homes remained depressed at just over 550 units during the fourth quarter of 2011, well in line with the quarterly totals noted since the last half of 2008; however, permits for multi-family units rose by over 125% over the previous two years to over 670 units by the final quarter of 2011.

Click here to download this residential real estate section.

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