San Diego Housing Market News and Analysis
Submitted by Rich Toscano on February 10, 2006 - 10:21am
Will Carless at the Voice has written an intriguing piece on cluster selling. This term describes a dynamic that is apparently taking place in San Diego wherein homeowners put their homes up for sale as they see their neighbors doing the same, resulting in concentrations of for-sale inventory in neighborhoods where this is happening. Several real estate agents "in the field" have apparently corroborated that cluster selling is taking place for the first time since housing bottomed out in the 90s.
The idea that cluster selling may be taking place fits in with what I've been seeing. As Premium users know, we have in recent months seen an interesting divergence in home price behavior: while the countywide median price has been fairly firm, over 20% of individual zip codes have seen their year-over-year prices decline by 5% or more. Cluster selling could certainly help to explain why certain zip codes are doing so much worse than others.
The idea that reality would start to dawn in pockets and through personal communication makes sense as well. Imagine this scene taking place...
Bob: Hi Jim - I see you have put your home up for sale. Why is that?
Jim: Hi Bob - I believe that home prices may decline, so I am going to take my equity off the table and rent for a while.
Bob: Don't you know that there is a housing shortage? And that everyone wants to live here? And that real estate always goes up? Etc?
Jim: Actually, as you would probably surmise from my urbane manner and chiseled good looks, I am a Premium Member of Piggington's Econo-Almanac. Therefore I know that there is no housing shortage, that San Diego's desirability in no way shields it from a housing downturn, and that, as a matter of fact, over 20% of San Diego zip codes have now had year-over-year price declines. I am, as they say, getting out while the getting is good.
Bob: Hmmm, I never read about any of that in the NAR press releases. I'd better go research the matter further.
Two Weeks Later...
Festus: Hi Bob - I see you have put your home up for sale. Why is that?
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