Amid signs that the superheated housing market of earlier this year has returned to normal, average prices of existing houses in metropolitan San Diego continued to level off in August from previous months, according to sales statistics released Monday by the San Diego Board of Realtors.
Although prices stabilized, a record number of transactions closed. A total of 1,599 houses and condominiums were sold in August, the highest number since the board was "regionalized" in 1983 with the merger of the El Cajon, La Mesa, Chula Vista and San Diego realty boards. The 1,599 units sold in August were 12% more than the 1,427 units closed in August, 1988.
Although August's average sale price of $213,870 was up 23% from the August, 1988, average, the resale price remained in a range that has changed little since April of this year, when an all-time average record price of $217,802 was set. Housing transactions that were closed in August generally were initiated in June and July, board spokeswoman Karen Rountree said.
The August median price, or the price at which half of all houses sell for more and half for less, was $180,000, a 22% increase over the $148,000 median price in August, 1988, but up only $5,000 from the $175,000 record median set in April of this year, Rountree said.
Another indication that the market is cooling off is that houses generally are staying on the market longer before selling, said William David, a broker with ERA-United Realtors in the Mira Mesa area.
Ann Throckmorton, a broker-owner of Century 21-Regents Properties in the University City area, described the housing market as having returned to normal.
"You have buyers \o7 and \f7 sellers out there now," Throckmorton said. "You cannot presume that you can list your house today and sell tomorrow. Properties that appear to be well-priced have a marketing time of from 30 to 45 days, compared to three to four days up until the middle of June."
Dennis Casey, a vice president with Home Federal Savings, said the activity slowdown in recent weeks may be connected to an uptick in mortgage rates in August. Interest on fixed-rate, 30-year mortgages dipped to as low as 9.5% in early August, before jumping back to as high as 10.375% now, Casey said.
The market is due to cool off because home buyers are stretching their finances to the maximum to qualify for loans. Also, much of the strength in the housing market earlier this year was supplied by existing homeowners who traded up for more expensive houses. Much of that trading up has now been accomplished, he said.
Rick McGill, a senior first vice president at Great American Bank, said his perception was that the local housing market is "still strong but not overheated," based on his S&L's "still pretty good" lending activity.
S.D. HOUSING PRICES
This chart reflects the average sales prices of existing housing in San Diego, La Mesa, El Cajon, Chula Vista.
MONTH AVERAGE SALES PRICE NUMBER OF SALES January 1988 $155,438 669 February 1988 $160,826 518 March 1988 $160,704 1,088 April 1988 $161,653 1,179 May 1988 $169,301 1,319 June 1988 $175,416 1,494 July 1088 $171,819 1,302 August 1988 $182,237 1,427 September 1988 $179,975 1,421 October 1988 $178,908 1,116 November 1988 $191,649 1,198 December 1988 $182,320 1,111 January 1989 $202,240 1,095 February 1989 $187,636 910 March 1989 $197,494 1,452 April 1989 $217,802 1,199 May 1989 $207,478 1,441 June 1989 $217,228 1,340 July 1989 $209,125 1,153 August 1989 $213,870 1,599
Source: San Diego Board of Realtors.