Final 2014 Results Show Strengthening US Market, More Growth Expected
The data is in, and 2014 turned out to be a pretty fruitful year for real estate markets all across the country. According to a recently released report from the National Association of Realtors, we saw the median sales price of existing homes rise by 5.8% to $208,500 last year – the highest median value since 2007.
Year-over-year, the total number of real estate transactions in 2014 decreased slightly by 3.1%, representing about 160,000 fewer transactions than in 2013. Experts attribute the small decline to a weaker-than-expected first half of the year, and a slipping supply of available properties during the last few months – the number of listings dropped 11.1% from November to December.
While markets in the Northeast suffered through powerful snowstorms and other inclement weather that drove their sales down 2.9% in December, other areas of the country fared much better. In the West, existing-home sales increased by 9.8% during the final month of the 2014. The West also led the nation in home values with a median sales price of $299,600.
As we progress further through 2015, many industry leaders remain cautious that a decreasing supply of properties could lead to quicker rise in home values and a greater affordability rift. One thing that may slow, but not stop, this growth is the fact that residential builders across the US have plenty of new homes in the pipeline – the NAR predicts housing starts to be up 23.3% this year – which could help balance out the current disconnect between the market's supply and demand.
San Diego Real Estate Market Enjoying Higher Sales Prices, Lower Interest Rates
The San Diego real estate market is still experiencing healthy growth across the board, even if there aren't as many properties being listed for sale as there were during the frenzy of mid-2014. With February's average of 5,926 active listings, the market's still 18.4% larger than it was at this point last year.
The total number of listings being sold is up as well. Last month, there were 2,527 residential sales reported by the San Diego Association of Realtors – a 21.5% spike over December's seasonally slow results.
Edging up slightly from December, the median sales price for single-family San Diego real estate broke the $500,000 mark again in January. Although solidly above that milestone from June to September, the monthly average dipped down to $490,500 as lower-priced homes began to gain popularity in the market towards the end of 2014.
One powerful force that is likely helping to drive the San Diego real estate market's recent push is the continued availability of affordable financing options. Despite seeing mortgages rise above 4.5% (which is still a historically-low rate) in 2014, the New Year is starting off on an even more enticing note – February's average of 3.85% is the lowest we've seen since May 2013. While rates are expected to rise at some point in 2015, we're likely to see them stay at very reasonable levels for at least many months to come.