Bold Predictions for Real Estate in 2019:
The National Market and Our Local San Diego, CA Market
Doom & Gloom? No! The market is looking great and stable! More inventory is coming, prices are stabilizing, and rates are still incredibly low. Good time to buy and sellers can still get a good price as the market is still moving relatively quickly nationally; the economy is strong and unemployment is low.
Prices and units sold are going to about the same (flat) locally in San Diego as 2018 and see a slight increase nationally. San Diego’s price point is higher than the national average to begin with; The National Association of Realtors (NAR) forecasts a 1-3% increase in prices nationally.
So, with about the same amount of transactions in 2019 as 2018, slightly higher rates and a strong economy, high consumer confidence and 7.5 million unfulfilled jobs = historically low unemployment. Those that want to work, can. 2019 is looking promising for real estate. In San Diego, Ca I see a buyer’s market forming. Rates will increase in 2019 (but a still very low avg. 5% will become the new normal). In 1989 I was paying about 12% and in 2007 I was paying 7%, so 5% is still quite awesome!
Locally, I’m seeing sellers struggle with nostalgic pricing and castle-syndrome. They think their home is the best on the block and want Q1 2018 listing prices for their Q1 2019 property. While pricing is not dropping, over pricing is, because bidding wars are giving way to discerning, patient buyers.
Discount brokerages fly by night agents and tech companies will begin to struggle and house flippers will begin to decrease. When market times begin to increase from 3 days to 30-60 days (essentially, they’ll approximately double from 2018 days on market stats, the skilled agent is seen as more valuable. (They always were valuable, but the public gets blinded by the speed of the market and tends to de-value full-service/full-fee agents when perception is skewed by short days on market times; I’ve seen this trend three times now in my career, since 1999).
FSBO Market is lowest in history! Down from an average of 9% historically to 7% (actual 3.5%) of the market sales. For Sale By Owners are at a historical low in an age when there is more technology than ever before; why? Because selling your home is more complicated than ever and a true professional is needed to properly price, market and negotiate your deal and then keep it together (problem solving skills) long enough to close your deal!
I’m excited for first time buyers, still excited for properly priced sellers and for my profession, the working by referral REALTOR in 2019. This is the type of market that removes the dross from the gold and reveals the value. This is the type of market (2019) that reveals the professionals and discards the amateurs. The summer soldiers departas they lack skills and experience, and the winter patriots do what they’ve always done through multiple markets; professionally serve home sellers and buyers with excellence and the experience of a consummate professional.
You have a choice! You can brew your own coffee, or buy coffee at a gas station, Starbucks, Philz or Duncan Doughnuts. You can spend $1.50-$6.00 for a same size cup of coffee. So what’s the difference and why do some pay more than others? Service, the buying experience and quality (where the beans are sourced from and how they are brewed). 10% always pay the highest price because they feel it represents quality. 10% always pay the least, it’s all about price for them. 80% buy value; show them the value, they’ll buy it. No value, no sale.
Oh by the way, I’m never too busy to serve you and your referrals! Whether it’s simple advice, referrals to the many professionals & trades people I work with weekly or my own buyer, seller (and divorcing home owner services) & investor services. Remember I offer military discounts and serving our Active Duty Military and Veterans is the cornerstone of my real estate business.
link to Brian Buffini Show Episode #131 December 4, 2018
Information sources: Buffini & Company, NAR and Thomas J. Nelson
Image 1. courtesy of ankris at FreeDigitalPhotos.net
All other Images courtesy of Buffini & Company