Here are some insights into what we can expect going into October. The biggest one being the question… “Are current delinquency rates going to affect the market in the future?”
We’re currently clearly in a hot Real Estate market all through September, but what’s fueling this fire? I’d like to point out that for the past 13 years, San Diego has always been a hot market with a lot of buyer demand. What’s changed over the years is our inventory levels. While demand has continued to be on the uptick, our inventory levels are down by 44% percent compared to this time last year!
Due to the supply-demand gap, homes are selling out faster and for a little bit more as well. The average sales price from this time last year has increased by 11%!!! Yes your heard us correctly!
This month we’ve had over 2,000 properties come onto the market, but over 3,000 of them went off the market! This is unlikely to changes unless a large amount of people attempt to sell their homes in October.
You may have already read the news articles talking about how millions of homes are facing foreclosure with 30+ days of unpaid mortgage payments hanging in the balance. This data is factually correct; we currently have around 3.8 million homes that are 30+ days overdue on their mortgage payments, according to analytics company Blackknight.
But that figure is somewhat misleading as it’s not shown percentage-wise as a relative portion. We have around 330 million people living in the U.S. with 66% ownership, which is clearly a lot more than 3.8 million. When we compare the figures to last year, the number of people with 30+ days overdue mortgage payments has only doubled. This came as a shock to me considering that we’re literally in the midst of a pandemic and last year we were considering the real estate market as the strongest it has ever been. But this also confirms my belief that we aren’t in a real estate recession, we’re in a temporary economic recession due to the pandemic. Real Estate in my eyes is the safest investment during times like these and Real Estate is the ultimate protection against inflation which is why we’re probably seeing so many people swoop in to buy right now.
Don’t let the non-contextual figures on the news scare you away from real estate investment. When we look at the delinquency rates percentage-wise it amounts to just 6.8 percent of Fannie Mae B backed mortgages which is extremely low considering our economic climate.
- If you are thinking about buying or selling we would love to help!
- Visit us at TrueLocalRealty.com
- Or give us a call at 888-503-3117