Positivity Flows as the Money Quickly Goes to San Diego Home Buyers with Closed Escrows
May 7th, 2010 by Kathleen Behrens
Houses for Sale in San Diego – The San Diego housing market is the only one of 20 major real estate markets which has shown continued improvement in home prices from January 2010 to February 2010 according to the most recent press release from Standard & Poor’s/Case-Schiller Home Price Indices. Standard & Poor’s/Case-Schiller Home Price Indices, which are considered the leading measure of home prices in the U.S., track the sales prices for single family homes in 20 major metropolitan areas, including the prices of homes in San Diego.
In the previous S&P/Case-Schiller Home Price Indices release, which compared home prices from December 2009 to home prices in January 2010, San Diego and Los Angeles were the only two cities in which home prices increased from one month to the next. According to the latest report, Los Angeles experienced a 0.7 percent decline in the price of homes. Meanwhile, San Diego home prices continued rising with a 0.6 percent increase from January 2010 to February 2010.
The percent of change in home prices over the one year period from February 2009 though February 2010 revealed an increase in the price of homes for nine of the 20 metropolitan areas, including San Diego and Los Angeles. San Diego home prices increased 7.6 percent, and home prices in Los Angeles increased by 5.3 percent. The other cities in which home prices improved over the year to year period were Boston, Cleveland, Dallas, Denver, Minneapolis, San Francisco, and Washington.
San Diego County’s Index of Leading Economic Indicators also increased by one percent in March, marking one year of a continual rise following three consecutive years of decline. The increase has been attributed to rising stock prices and an improved outlook regarding our nation’s economy. During the first quarter of 2010, San Diego stock prices were up 10.6 percent when compared to the first quarter of 2009.
The National Index of Leading Economic Indicators rose by 1.4 percent in March as reported by The Conference Board, which is run by TNS, the largest custom research company in the world. In addition to the March rebound, the Conference Board Consumer Confidence Index also increased in April as well, from 52.3 in March to 57.9 in April. The Consumer Confidence Survey is conducted monthly by surveying 5,000 U.S. households. The Consumer Confidence Index is currently at the highest level it has been since September 2008 when it reached 61.4. Consumers have been demonstrating more optimism in relation to business conditions, the labor market, and job growth.
The positive indicators also include the hiring of 5,000 new San Diego employees and fewer initial unemployment claims. Data from the Monster Employment Index has revealed the number of help wanted ads has reached the highest level since December 2008 due to an increase for five consecutive months.
New San Diego home construction offers further evidence of our improving local economy. The number of building permits issued for the construction of new San Diego homes was up 21 percent during the first quarter of 2010 from the same period last year. In fact, the number of building permits issued in the first quarter of 2009 for building new houses in San Diego reached a record low. During the first quarter of 2010, the number of permits for new single family San Diego homes nearly doubled. However, the number of permits for new multi-family San Diego homes fell almost 36 percent. The strength in San Diego housing prices and sales of San Diego homes has added stability to the San Diego real estate market and our local economy.
Although San Diego’s economic recovery has been slow, it is expected to continue. A report from the Burnham-Moores Real Estate Institute at the University of San Diego indicated the 12 month increase in the economic index for San Diego is a sign our local economy bottomed out in late 2009 or early 2010. With San Diego home prices on the rise and the $10,000 California home buyer tax credit in action, now is an excellent time to enter the San Diego real estate market and begin looking at houses for sale in San Diego.
The $10,000 California Home Buyer Tax Credit program began accepting applications on a first come, first served basis from home buyers who have closed escrow on a new or existing California property to be used as a principal residence on or after May 1, 2010. Applications may not be submitted until a home buyer has closed escrow. Home buyers should also note applications must be faxed within two weeks after the close of escrow on the 2010 form. According to the California Franchise Tax Board, improperly submitted requests will be denied.
The $200 million for this program has been split into two categories; $100 million for first time home buyers and $100 million for buyers who purchase new homes. The California Tax Board anticipates the $100 million designated for first time home buyers will run out quickly. In fact, the California Tax Board has announced estimates will be posted on their website to let first time home buyers know how many applications have been received and how much of the $100 million has already been claimed. The California Tax Board will stop accepting applications when it believes all of the funds have been depleted. Yesterday the California Tax Board posted the first update; as of May 4, 2010 an estimated 427 applications had been received and first time California home buyers had already claimed $2,350,708 of the money earmarked for first time home buyers.
San Diego buyers who intend to purchase new houses for sale in San Diego are expected to have more time to buy a San Diego home and obtain the credit. The California Tax Board plans to begin posting information in July 2010 regarding the number of applicants and the amount of the credit claimed for the $100 million designated for new home purchases. San Diego buyers planning to purchase new houses for sale in San Diego may request a reservation prior to the close of escrow on a San Diego home to hold their place in line to acquire the credit. Although a reservation is not required and it does not guarantee a home buyer will receive the credit, it is a wise idea to take advantage of this special feature, which only applies to buyers who purchase new homes.
If you are interested in purchasing a San Diego home, there is no time like the present. Home prices are low, interest rates are excellent, and San Diegans can claim a $10,000 state tax credit. But don’t hesitate, or you may find it’s too late to take advantage of the $10,000 tax credit. Although San Diego home prices and interest rates are low, they have also been on the rise. If you wait too long, you could be in for a big surprise.
Begin your search of houses for sale in San Diego today or contact San Diego Realtor and Broker Russ Petrone of Petrone Properties at 858-259-1000 to have a customized search of the houses for sale in San Diego created specifically for you based upon the criteria you require for your San Diego home. If you don’t want to go it alone, just pick up the phone. Give Russ Petrone a call. He is here to help you with it all!