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February 14, 2011

The cost of waiting to buy that house has just gone UP!
Ouch! The 4th quarter numbers seem to be telling us that prices are up not only here in the communities of La Jolla, UTC/University City, Del Mar, Carmel Valley, Carlsbad and Rancho Bernardo, but all over San Diego County. The Good news is that home affordability it still very low because interest rates have remained low. The bad news is that the threat of inflation has caused the interest rates to start up.

When I speak with potential home buyers they seem to have three concerns. First is concern that prices will continue to fall. The next concern is that interest rates will continue to drop. The final concern seems to be just a general distrust of the national economy, otherwise reported in the financial markets as "Consumer Confidence".

If we take these concerns in order this is what is important to understand: the reports for the last eleven months are that the median home prices are up each month in San Diego County. Overall for 2010 prices in some San Diego markets are up as much as 9% over the prices of 2009. The San Diego residential real estate market is reported by the NY Times to be the strongest in the country. As far as interest rates go they are up and my concern now is that they will continue to go up. The lowest recently advertised rate I saw was 2.74%, (not happening). Often times the advertised rates are very confusing - talk to a lender you trust or that somebody you know recommends rate vary day to day, and a good lender will find you the best rate and lock it in for you before it goes up another 20%. If an interest rate is up by 1% it could mean a 10% in your house payment. Consumer Confidence in our experience has been coming back during the last month. Call The Mills Team toll free 888-450-6691.



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