The Word

September 2, 2010

The residential real estate resale number for July just came out. The drop off in sales of existing homes, even in premium neighborhoods like Mission Hills in San Diego, spooked the stock markets and presumably a raft of potential buyers.

I worry about this market and particularly the spector of future price deflation. The July number, however, means nothing to me. First, the first time buyer credits have gone away. Like cash for clunkers, there were a lot of purchases made last spring that would have been made in July. The first-time program just spiked sales but did little to alter the landscape.

This program played out just like cash for clunkers, people just acted a little sooner. So I am not going to worry those numbers just yet. We will have to wait until the post Labor Day market unfolds in the Metro residential real estate market.

Mission Hills residential real estate is still performing on an even keel.  I certainly recognize the increase defaults in Mission Hills as well as other better spots in the 92103 marketplace. The sale price per foot, however, has remained remarkably stable over the past two years.

 Regards,

Jim