Shrinking Housing inventory in the San Diego Market makes for frustrated buyers

My ACT! database is full of qualified buyers clamoring to find their dream home, their “bargain” home now selling for 50% off their value two years ago. Many of them are at a price point of $200-350K which in San Diego is the first time home buyer level for which thousands of other buyers are also competing, driving up the bidding to levels that the comps and the appraisal won’t support. It is common to see listings with literally dozens of offers!

On May 20 our local MLS, Sandicor, added a new status of contingent to reflect all of the short sales that are pending approval. This, we all agree, is a great idea to save time and more accurately reflect the truely Active listings . Then this morning California announced another 90 moratorium on foreclosures insuring that going into our bread winning, hay making summer months it is going to be a nightmare finding homes for these buyers.

Now don’t get me wrong, I am happy that CA is mandating that banks focus on loan modifications for deserving homeowners. The problem is that a very large percentage of those loan mods are re-defaulting 6 and 9 months later because they couldn’t afford the home in the first place and their principle balance was not reduced. Sad and painful as it is in the short run, if the banks are not going to do principle reduction then would it not be better to simply foreclose and put other qualified buyers in to these homes and clean up this mess quicker? Would this be better for everyone involved? Sometimes I get slightly envious of Realtors in markets like Phoenix that have a plethora of choices for their buyers.

I would be interested to hear your thoughts on this.

Namaste’

Jennifer- San Diego REALTOR