Residential single family homes rise 5-percent in price this year
Snapshot of the North County Real Estate Market through the first three quarters of 2016
–In-town residential single family home sales were even in volume with 2015 and prices rose 5-percent to an average sale price of $396,000. Homes on an acre or more were also even in volume with 2015 and the average sale price of $653,000 reflected a similar 5-percent increase over the comparable 2015 period. Homes for sale dropped 7-percent as inventory continues to shrink.
Million dollar home sales increased a bit over 2015 and average sale pricing actually increased 4-percent year over year. Million dollar homes for sale increased 24-percent in 2016 over 2015. This market has been selective and less robust throughout the recovery. Demand has been consistent but supply is way ahead of absorption.
Vineyards and homes with vineyards are finally seeing some consistent action. The water ordinance has stopped all Eastside planting. Slowly growers and investors are realizing that the only way to be in the grape business is to buy existing vineyards. Most grape varietals are firm in pricing which is an added bonus. Buyers of vineyards today are protected from an increase in supply by the ordinance.
Commercial properties are in the best position since 2008. Vacancies still exist but there is a lot more actual user activity at this time. Tourism is super strong and growing. Apartments are in demand by tenants and investors. Financing is still a challenge across the board.
Home prices may be entering a plateau phase. There is an inverse relationship between interest rates and asset prices such as homes. It seems that interest rates have found a bottom and in fact expectations seem to be in minor rate increases. Residential rates seem to have stabilized.
North County has risen to the challenge of competing in a no growth economy. Our city government works. The wine industry has created an industry of scale that attracts high quality consistent tourism dollars. Every weekend it seems we are party fresh. Perhaps our greatest asset is the community spirit inherent in our citizens. We have a healthy respect for our past and generous attention to our future. Who has it better than we do? Nobody!