The San Diego Real Estate Market April 2009

 

With the real estate meltdown, the banking crisis and the resulting job losses throughout America, our government decided to take a pro-active position. The results may be showing now.

 

Yesterday’s foreclosure news was very negative. Dataquick is reporting foreclosures up significantly. This is partially due to the recent moratorium on mortgages being lifted, so it may be three months of foreclosure filings all at once.

 

Highlighting the positive; San Diego had more than 26,000 homes listed in Sandicor, the local multiple listing service, about six months ago. During the past six months, banks have begun negotiating with borrowers who were in trouble. These were generally the short sale homes, which banks had to approve the sale, listed in the MLS. When the meltdown began, two years ago, banks weren’t prepared to handle the influx of requests to negotiate short sales. Many banks were so unprepared, they didn’t have a person whose job it was to negotiate or approve a short sale. For those properties, offers from buyers were made but banks just didn’t answer the request for a short sale. Those homes sat in the listings, racking up time as active, which made the average “time on market” surpass 90 days.

 

Today, according to the latest “Homdex Report” using March 2009 data (request a copy from me) the average days on market in San Diego is down to 46 (45 is considered a benchmark of a sellers market, but I don’t think 2009 counts). That figure has been sliding down for the past year.

Additionally, during the past six months many large banks have begun moratoriums on foreclosures, and started performing loan modifications. This again is cutting down on the number of homes listed in the MLS. As of today’s search I show 14,800 homes listed in the MLS for San Diego County.

 

If short sales and bank owned properties stop flooding the market, and normal home owners begin selling their homes, we will return to a free market value; the price a property would bring if freely offered on the open market with both a willing buyer and willing seller.

 

I will keep searching the data and try to post information that hints at a change in the market.