Where have all the condos in downtown San Diego gone????

There is an extreme shortage of condos available for sale in Downtown San Diego!!!

A quick look at MLS for downtown San Diego Condos shows a total available inventory of 301 units.  This includes all of 92101 real estate, so we’re including some of Banker’s Hill in these numbers.  As recently as 12 months ago, inventory would have been about double.  And the reason isn’t that condos aren’t being listed.  It’s that condo sales in San Diego have increased dramatically.

To compound this shortage of available downtown San Diego Condos, the steady 10 year flow of new construction has ended.  Since 2000, almost 10,000 new condos were added to the San Diego Condo Market.  There is a current inventory of approximately 300. 

Let’s talk resale condos in Downtown San Diego

Have you heard people talk about what a challenging real estate market this has been?  OK, acknowledging that prices have dropped, in some cases precipitously, let’s just focus on inventory and sales.  In the two years from May 2007- May 2009, there were 1,308 condo sales in 92101.  In the ensuing 2 years, culminating this month there have been 1,821 condo sales in downtown San Diego. That’s a 30% overall increase in volume!

In this 2 year time period, we’re talking about 75 condo sales per month.  The most recent 6 months show 459 sales (76/month).   It’s not as though the statistics are skewed–this is a trend that has been building over the past 4 years.

So let’s talk about current inventory

The table below shows the distribution of “days on market” for the current inventory of  301 condos available in Downtown San Diego:

Taking a cursory look at pricing, the inventory becomes even tighter.  The current “median” (mid point among all listings, ie. 150 higher priced, 150 lower priced)  listing for a condo in Downtown San Diego is $459,000.  The median sale price over the past 6 months has been $340,000.  The distribution of listings shows more than 70% are above the median sales price, creating an even tighter inventory picture.

Downtown San Diego Condo Prices are Static

The logical conclusion to the facts presented here is increasing prices.  Yet, this is not the case.  The table below represents a very popular floorplan at Acqua Vista.  Over the past 24 months there have been 14 sold.  Allowing for placement in the building, ie. higher floors, the lowest puchase prices have been those sold in 2011.  We currently have a pending sale of this floorplan at a price that will be the historical low, and are involved in a multiple offers scenario for yet another.

The case study of Acqua Vista is spot on to the tightening of downtown condos.  There have been 90 total sales at Acqua Vista over the past 2 years.  There are currently 10 listings available.  And yet prices remain static.

We are currently representing buyers in the Marina, East Village and other Little Italy transactions where we have identified other “low watermark” purchase prices.  These include premier San Diego condos like Pinnacle and Cityfront Terrace.

It is totally contrary to economic principles that it remains a buyer’s market in light of the scarcity of inventory.  And yet, at all levels of the market, that is what we have found.  I invite you to engage in a conversation about San Diego real estate.  There are fabulous opportunities to own a home in Downtown San Diego.