Here’s what you need to know if you’re thinking of buying a home in San Diego.
As we move through the fall season, you may be hearing a lot of things from the media regarding our real estate market. Some say we’re in a bubble and that a slowdown is imminent. Others say you should buy now because it’s a great opportunity.
2020 has been an interesting year as far as our market goes. As you know, a lot of people lost their jobs after the COVID lockdown, and the market was expected to sink concurrently. That didn’t happen, though. All the while, interest rates have been sustainably low—the lowest I’ve ever seen. In fact, I’ve seen loans close at just 2.5%, which is mind-blowing. This helped our market keep a fast pace.
What should you do if you’re a tenant thinking of buying a home? This might sound crazy, but hear me out: Do what you think is right. If you’ve been paying $2,000 to $3,000 per month in rent for the last three to five years, you’ve been paying $50,000 to $60,000 annually with no tax deductions. If you really want to buy, don’t focus on a home’s price—focus on your potential monthly mortgage payment. With rates as low as they are, you can buy in the $500,000 to $550,000 range and still pay $2,000 to $3,000 per month for your mortgage. If you’re willing to spend a little more ($650,000 to $700,000), you’ll be able to find homes in better neighborhoods.
This part of the year, it’s been very challenging to get a home under contract because inventory is so low in San Diego County. We only have between 3,600 and 3,700 homes for sale (this supply only includes detached homes, twin homes, condominiums, and townhomes). There are between 4,200 and 4,500 pending homes.
The good news is that I know plenty of tips and tricks to help you get the home you always wanted, so your first step in the home buying process should be to give me a call. My team and I will give you a free buyer consultation and let you in on the secrets of making a strong offer. For example, we’ve been shortening the timelines of the inspection and appraisal contingencies for our buyer clients (sometimes waiving the appraisal contingency altogether), which has proven very successful in getting their offers accepted.
If you’d like to start the home buying process or have any real estate questions at all, don’t hesitate to call or email me. I’d love to speak with you!
