Decline in San Diego Housing Market

The last housing decline in San Diego was last seen in the mid 1990’s. At that time, an almost twenty percent decline in housing took many by surprise. A huge housing value decline in San Diego might seem unusual to many, but another depreciation of San Diego real estate could be on its way. The easy loan practices of today combined with the double digit housing appreciation of the past few years is a clear indication of another approaching decline in the San Diego housing market.

A majority of local San Diego loans for the past few years were zero down, adjustable loans. With the slow but steady rise in home mortgage interest rates, San Diego could be facing a decline in housing values that could shadow the twenty percent decline of the mid 1990’s. The local San Diego real estate market is more at risk than any time in recent memory.

Although housing bubbles may last far beyond anyone’s expectations, now could be a good time to reconsider any new purchase in San Diego. Purchasing your first home is not something you should try to time or tie into projections on the local housing trend. Always be cautious and stay well within your normal qualification ratios of debt. Consider starting out modestly with a smaller home or condo that you can easily afford. You can then use the equity in that home to buy up to a larger house.

No one can thoroughly predict the future trends of any major market with certainty. However, with the never ending double digit housing appreciation in San Diego, caution is advised in San Diego housing.


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