“Is there a market bottom–and when will it arrive? Are we there yet?”
We keep hearing that buyers are sitting on the sidelines, wondering when and where the bottom of the San Diego real estate market might settle.
Yet when San Diego’s foreclosed homes are listed much below market value, our investors and buyers are encountering (and participating in) multiple offers that push the price of that foreclosure into true market value range.
And where does the bidding stop?
At, or close to, true market value.
These circumstances are nothing like San Diego real estate auctions, where a mix of amateurs and seasoned pros are bidding against each other in a noisy frenzy. Properties are sold as-is and buyers must be prepared to pay a buyer’s premium that ranges between 5 and 10 percent of the ultimate sales price.
Under normal listing circumstances–which may include foreclosures, buyers are urged to make their best offer up front, and be prepared for the seller’s counter offer. Buyers are given hours or days to respond, instead of auctioneer’s seconds.
The good news is that San Diego’s real estate market does have a bottom. It is one that obviously varies upon location. In Chula Vista, Otay Mesa and other South Bay areas, the bottom may be bouncing around 2004 prices (and even lower in certain neighborhoods). Around the coast, prices seem to be hovering around 2005 pricing–or even better if the property is located on the ocean, or has a rare ocean view.
We watch the San Diego real estate market constantly, and use our own published market statistics with our clients from here and abroad. San Diego will always be more expensive than Dallas, Miami, Minneapolis or Scottsdale, if only because of our incomparable year round climate. For that reason alone, our real estate pricing will not collapse as it might in certain other areas. San Diego’s economy is strong, its desirability is global, and few wish to leave this paradise. After all, why buy in a place where you have to leave for three to five months out of the year to escape a yucky climate?
More and more, we hear that people choose to live or retire in San Diego County–and never plan to leave.
San Diego is rarely an interim stop. People come to visit, to stay…and rarely leave.
Could the same be said of Dubai?