Steve Doyle’s Blog

The national media continues to do a dis-service to the perspective home buyers of San Diego County. There is only one rule that applies universally to real estate values … LOCATION, LOCATION, LOCATION!

This past week we have seen headlines scream at us that the sky is falling and the world is coming to an end. The National Association of Realtors announced that sales of existing homes plummeted nationally 27.2% in July. Buried deep in that press release the San Diego Association of Realtors reported existing home sales were down 13% in San Diego County.

Yes, 13% is a large drop, but in a County where the Federal Tax Credit for buying a home ended in May and the State Tax Credit for buying your first home ended in June, a drop of 13% was not unexpected. The fact is many home buyers accelerated their purchases this year to take advantage of those tax credit offerings!

Another national press release announced that the average price for the sale of an existing home was up 0.7% over the last 12 months. Claiming that the momentum from earlier this year was dead and that home prices had topped out.

Again, buried in that press release, RealtyTrac said San Diego County experienced a 4.6% increase in home prices during the past year. While fewer people may be buying homes (see discussion above regarding the tax credit incentive), they are paying more for their homes. And, those homes are increasing in value better than the rate of inflation or the rate on your savings account from any bank today!

And, finally, another national press release did highlight some positive news. This press release found that the home loan failure rate (including default notices, scheduled auctions and bank repossessions) had decreased by 10%. While the press release did not editorialize the benefits of this drop in the home loan failure rate, it did acknowledge that the reduction was a good sign.

Again, buried in the back of this press release, the numbers for San Diego County were a bit more improved. Home loan failure rates in San Diego County were found to be down 37% from July of 2009! That is an amazing factor and shows a very strong move by the home loan holders in San Diego County back towards stability and confidence in their home ownership financially.

So, let’s review the only rule that truly applies to real estate investment anywhere in the world … LOCATION, LOCATION, LOCATION! Can you guess where the smart buyers are putting their money in real estate today? Do you think it is on a national basis or right here, in San Diego County?

Well, you are right, But, I also would guess that you would not have come to that conclusion if you only read the headlines. Dig deeper, be a smart consumer!