San Diego Real Estate - A Popular Place to Live

In a recent survey San Diego ranked as the second most popular place to live in the United States. This is good news for San Diego, but bad news for would be homebuyers, as San Diego real estate and its job market seem to be stuck in a funk.

The San Diego Union-Tribune recently ran an article about the situation.

The forecast noted that median home prices in the Inland Empire have plunged 53 percent in two years – from $410,000 in December 2006 to $191,000 last month.

On the plus side, “sharp and steady declines in home prices... are significantly improving housing affordability,” the researchers said.

The average home buyer can plan on spending 20 percent of his income on mortgage payments, compared to 36 percent two years ago, according to the forecast.

Before the housing market can recover, however, the job market has to rally, researchers said.

The forecast predicted the unemployment rate in the Riverside-San Bernardino metropolitan area would edge toward 11 percent in 2009, with an estimated 14,000 jobs disappearing.

The metro area's jobless rate was 10.1 percent last month.

“Projected job losses will clearly trump the improvement in housing affordability and will lead to another year of weak demand for housing,” the forecast said.

The resale values on single-family homes was projected to decline another 10.7 percent this year.

The Riverside County Board of Supervisors recently warned that evaporating property tax revenue, which accounts for more than half of net county tax revenue, will make budget cuts totaling 25 percent necessary over the next five years.

The Chapman forecast said a national economic recovery will become noticeable by year's end, but growth will be anemic unless “financial institutions start lending again” and consumer spending picks up.

While this may not be good information for the thousands of people hoping to move to San Diego, it is good news for those ready to buy, for those with good credit, capital and job security.