As of the New Year, we had 4,259 homes for sale in San Diego. Despite the fact that the number of detached homes sales, as measured in units, was down 1% year over year in December, inventory of homes for sale has reached the lowest level since we began tracking it in June 2013. Why?
There are just far fewer homes for sale on the market. Detached homes for sale as of the beginning of January are down 12% year over year falling from just over 2 months to 1.8 months supply through December. Obviously, this is a big move in relative terms but in absolute terms it’s nothing. We are pushing against a downward bound here as, given supply constraints, inventory literally can’t fall much more. In other words, inventory levels can’t fall below zero just like unemployment rates can’t turn negative. If you a thinking about selling your home in the next year, how much more perfect do you want conditions to get?
Here is the key with the chart above: homes prices follow changes in inventory levels on a lag. In other words lower inventory levels today could set you up for a higher price on your home sale 3-6 months from now.
If you are thinking about selling your home in the next six months, now is the time to begin a conversation with a realtor that is thinking about these issues. Call us now to get a conversation started: 858-252-6500.
Bob Flynn, January 2017