It's no secret that the housing market in San Diego has been on a downward trend in recent months, with home prices falling almost $100,000 in the past year according to CoreLogic. But a recent report from Goldman Sachs has revealed that San Diego, along with three other American cities; San Jose, Austin and Phoenix, is at risk of experiencing a housing market crash similar to the one that occurred in 2008.
This decline in home prices is not a surprise to many economists, as the Federal Reserve has been steadily increasing interest rates to combat inflation. These higher interest rates have made it more difficult for potential buyers to secure mortgages, which has led to fewer listings on the market and fewer sales. According to Redfin, sales in San Diego County were down almost 50% in December compared to the year before, and homes are staying on the market longer as a result.
While the current market conditions may seem dire, some experts believe that the slowing housing market could actually be a sign that a recession is on the horizon. Economist Alan Gin from the University of San Diego predicts that there is a 70% chance of a recession in 2023, and that it would likely be caused by the Federal Reserve's interest rate hikes and their impact on the housing market.
Despite these challenges, it's important to remember that a housing market crash is not inevitable. It's likely that we will continue to see fluctuations in the market, but with the right strategies and a good understanding of the market conditions, it's possible to navigate this uncertain time and come out on top. For sellers, this may mean being more flexible on pricing and being prepared to negotiate with buyers. For buyers, it may mean being more selective about the properties they're interested in and being prepared to move quickly when they find the right one.
Ultimately, the key to success in the housing market is to stay informed and work with a trusted real estate professional and a company like AOPTA The Property Tax Experts can quite possibly save you a ton of money with a property tax appeal. The right professionals can help guide you through the process. With the right guidance and a bit of patience, you can weather this storm and come out on top.