Housing sales fall again
By Dave Downey
Apr. 13--North County's once red-hot housing market continued to chill out last month as sales fell sharply from March 2005, but detached homes still showed slight price appreciation over the year before, according to a report released Wednesday by the North San Diego County Association of Realtors.
Nicole McAllister, executive director of development for the University of Southern California's Lusk Center for Real Estate, said, "What is happening is, the increased (housing) production that's taken place over the last 12 to 18 months is now catching up with demand."
On the other hand, Robert Campbell, an independent San Diego economist who tracks real estate trends and who believes that homes are priced beyond what the economy can sustain, said there is plenty of reason for concern. And San Francisco-based PMI Mortgage Insurance Co., which periodically evaluates the sustainability of housing markets, rates San Diego County No. 1 in the nation, in risk of price decline.
"Real estate is a highly cyclical market," Campbell said. "From this point in time, it's only going to get worse. The good times are behind us. The money's been made. The market only gives so much before it starts taking away."
Campbell suggests the San Diego County market is out of whack because median family income is roughly half the pay it takes to buy the median-priced home, and today's prices trigger mortgage payments generally twice what properties can command in the way of rent.
"Eventually, all markets will come back to equilibrium," he said.