Paso Robles home prices jump 33 percent
Paso Robles real estate market heating up
By Rylan Stewart
Central Coast Lending
The Paso Robles real estate market was one of the hardest hit when the housing bubble popped, and as the recovery has progressed, it is among the Central Coast cities accelerating the fastest.
“The market has jumped about 20% since last Christmas,” said Re/Max Parkside realtor Lisa J. Lewis, referring to Paso Robles’ home prices. ”$400,000 is like the old $300,000 just a few months ago. Prices keep moving up.”
The median price for the 58 single-family sales in May 2013 was $386,750, which is up 33% from the median of $290,000 for 60 sales in May 2012, according to real estate statistics aggregator Keith Byrd, whose data comes from the Scenic Coast multiple listing services.
Through the first five months of 2013, the median price of $359,000 is an 18.7% gain from the same time period last year. As the housing market recovery progressed, improved economic conditions and positive housing affordability have helped to fuel higher demand for property.
Unemployment fell to 6.1% in San Luis Obispo County in April, which is one of the lowest in the state of California. Record low mortgage rates and bargain home prices helped to make the market affordable for a larger section of the population.
As a result, Paso Robles’ 594 total single-family sales in 2012 was the most since 2005. With all of the sales, existing housing inventory has begun to dwindle, and the market is struggling to find enough immediate replacements to meet demand.
Despite price gains, many mortgages are still underwater – an estimate by Zillow puts 28% of the homes still have negative equity. Negative equity hurts the ability for existing owners to put their homes on the market.
Construction activity is slowly recovering, but builders have had trouble finding adequate lots for new homes. In the meantime, as supply dwindles, sellers are asking for more – and buyers are willing to pay.
“I just sold a house in a Paso Robles neighborhood and we closed escrow at $330,000,” said Lauren Beckett, realtor at Prudential Hallmark Realty.
“A few days after, a house with a similar floor plan, square footage, and size came on the market in a similar neighborhood for $353,000. Two days later, it was pending.” Though the median price in Paso Robles is gaining, it is still 26.7% below the peak of $490,000 in 2006.
Between 2001 and 2006, the median sales price of single-family residential home in Paso Robles jumped 108.5%. During the boom years, home sales moved above 800 per year, reaching 928 in 2004.
When the bubble popped, prices dropped sharply, falling to 40.8% by 2011. Now, with two consecutive years of price and sales gains, the recovery is seems to be in full swing.
Rylan Stewart is the marketing director of Central Coast Lending.