In spite of job losses and high unemployment, the median price of a single family home in San Diego County is still rising, hitting an all-time high of $700,000 in July.
Phil Molnar, who covers residential real estate for The San Diego Union Tribune, said the price rise is partly due to the reduced number of homes on the market, and partly due to record-low interest rates. He said competition for the homes currently on the market is fierce, and buyers can expect to pay several thousand dollars over the asking price to win the bid.
Molnar said the biggest price increases are at the upper end of the market, since the stock market is strong and those in higher paying jobs are less likely to have become unemployed.
But homes in the middle and lower price ranges have also been affected. Some buyers are families from more expensive housing markets, who have realized that, since they can now work from home, they can purchase a larger home in San Diego than they could in San Francisco.
Molnar said some predictions suggest home prices could experience a slide by the end of the year. But he said market conditions are not the same as the housing bubble that burst before the 2007 housing crash. The current price rise is based on different factors, such as record-low interest rates.
However, the net effect of the rising home prices is to exaggerate the phenomenon of “two San Diegos,” with a growing gap between those who can afford to buy a home and those who cannot.
