San Diego short sales seem to be something we are all talking about and taking for granted right now. Whether a Chula Vista short sale, or a Coronado short sale, we all tend to see the home market as being in terrible straits. Obviously San Diego home prices have taken a tumble over the last few years. No one can argue about that. However, when you compare world prices, you will see that between 1997-2010 prices in the United States actually show between a 58% -71% increase.
I don't know about you, but this is actually some very good news in a bad market.
These statistics from the Economist still show us the United States is between a -6.5% and a +11.3% under or over valuation, depending on whether you are using Case-Shiller index or FHFA (Federal Housing Finance Agency). As much as I would like to believe FHFA, I think Case-Shiller works better for me.
FHA and subprime loans got us into this mess. I would rather think we are undervalued right now than overvalued. Most of us are ready for this housing collapse to be over. We can wish and hope.
Downtown San Diego condos are in the undervalued marketplace right now. There are some tremendous bargains, whether traditional sales, short sales or foreclosures. The only country on this list that I can see has consistently increased their pricing is Switzerland. That's probably because they are conservative and have a lot of our money in their Swiss banks.
One of the conditions right now is lack of sales. Buyers have hit the wall. They are unsure of their jobs, their income, their expenses and their government. None of us where we are going in the current environment. We have people in power wanting to tax tax tax and businesses just do not expand under those conditions. Therefore buyers do not buy large purchases and homes and condos move slower. Interest rates are the lowest I have seen in my 33+ year career and these low rates are not motivating too many people to take the plunge.
Australia seems to have an overheated market right now. Let's hope they are smarter than we were and don't tumble like we have tumbled. Australian prices declined in June for the first time in 17 months. The Chinese don't feel they have a bubble due to higher downpayment requirements, but we all thought the same thing a few years back. We were wrong. They may be wrong.
To read the full Economist article just visit the Economist website.
Sharyn and Victoria Crown are San Diego real estate brokers specializing in the purchase and sell of good investments. Visit our Downtown Crowns website or search the San Diego reale state market at our San Diego Crowns website.
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