San Diego home buyers in a ‘holding pattern’? Home sales plunge

San Diego homes sales have slowed to a snail’s pace.

In September, 1,987 homes sold in San Diego County, CoreLogic reported Friday, its lowest for a September in records going back to 1988. It also marked the 10th-slowest sales month of all time.

Sales were down 22% from August, and down 6.4 percent from the same time last year when home purchases began to fall off considerably.

San Diego County’s median home price was $880,000 in September, down $15,000 from its peak in May, but still up 6.2% in a year.

Mortgage rates and still-high home prices have significantly slowed sales across the nation, not just in San Diego. While September is typically a slower month, because kids are returning to school, seasonality can’t fully explain recent events.

Mark Goldman, a San Diego loan officer and real estate analyst, said there was a lot going on in September to dampen sales: Fluctuating mortgage rates began to shoot up again and there was trepidation over the upcoming election.

“I think people were staying on the sidelines, to see which way the wind would blow,” Goldman said. “People kind of were in a holding pattern. I expect us to return to a more seasonally normal level of sales in November.”

Mortgage rates actually hit a low point in September, an average 6.08% for a 30-year, fixed-rate mortgage in the last week of the month. However, rates quickly rose after that, hitting 6.72% by the end of October.

Mauricio Perez-Vazquez, a Chula Vista real estate agent, said potential buyers did not have time to take advantage of lower rates.

“It didn’t last long, that’s the thing,” he said. “A lot of people maybe thought, ‘OK, (rates) are starting to drop.’ By the time they were ready, lower rates were gone.”

Perez-Vazquez said lower sales could also explain the number of homes for sale dropping. There were about 5,500 homes for sale at the start of September, said the Redfin Data Center, but that number has been steadily declining since to around 5,200. He said the lack of inventory was making sales more difficult for potential buyers.

A recent study from Orange County-based Reports on Housing said many sellers were throwing in the towel after not getting high enough offers for properties. The real estate research firm said as of September, 6,990 homes have been taken off the market compared to 3,478 last year.

Redfin said the median number of days on the market for a San Diego County home was 26 in September, up from 15 days at the same time last year.

There were still bright spots to be found for some buyers in September. Perez-Vazquez said he helped a buyer qualify for the California Dream for All program, which gives up to 20 percent down for first-time homebuyers. Applicants must be a first-generation homebuyer and have a household income of less than $189,000 in San Diego County. His buyer was able to buy a $550,000 condo in downtown Chula Vista.

Here’s how different home types in San Diego County fared in September:

Resale single-family: Median of $982,500 with 1,252 sales. It is down from a peak of $1,007,500 reached in May.

Resale condo: Median of $690,000 with 610 sales. It’s down from a high of $723,000 in April.

Newly built: Median of $801,000 with 93 sales. This figure combines single-family homes, townhouses and condos. It was down from a peak of $1.2 million last July, when there was an influx of newly built single-family homes, lifting the median higher.

Home price gains were mainly down or flat across Southern California in September. Here’s a look at the median prices in the counties:

Los Angeles County: Down 2.9% monthly for a median of $850,000; up 1.6% in a year.

Orange County: Flat month-over-month for a median of $1,175,000; annual rise of 11.6%.

Riverside County: Monthly rise of 0.4% for a median of $579,500; up 5.4% annually.

San Bernardino County: Down 2.2% in a month for a median of $498,750; up 3.2% annually.

San Diego County: Up 0.6% in a month to a median of $880,000; up 6.2% in a year.

Ventura County: Down monthly 4.2% for a median of $820,000; up 1.2% annually.