Low interest rates, discounted prices, and a host of upgrades and builder incentives are stimulating demand for new homes in San Diego, CA. The sales volume of San Diego new homes is down 40% from 2008, but recent buying trends suggest support at current levels. Builders are becoming more optimistic, but new construction plans are still be stalled by a freeze on new construction financing.
Shae Homes recently released a new phase of single-family houses at Chaparral Ridge in Escondido, CA. Prices for the Chaparall Ridge homes start in the $500,000’s. Seven homes were released in the tenth phase, and all seven homes were under contract on the first day of the release. This was the first one-day sellout in years, and is a fair indication of the rising demand for new homes in San Diego County.
Copperwood Homes By ColRich in La Costa (Carlsbad, CA – San Diego)
ColRich has also had success with its newest releases of homes at CopperWood and RockLedge in La Costa, in Carlsbad, CA, North County San Diego. CopperWood opened in May 2009 and has sold 12 of the 53 homes planned for the community. CopperWood houses are priced in the range $759,900 to $811,000, and the ColRich is offering a huge variety of free finishes and upgrades included in the purchase price. ColRich Chief Investment Officer Danny Gabriel says that by keeping their inventories lean the company has avoided carrying costs on unsold homes, thereby allowing them to offer more attractive prices on their existing inventory.
KD Development is a niche builder, specializing in building more affordable infill condos and town houses in the San Diego beach communities. The company has found success by identifying desirable locations where demand has remained strongest. In the past year the company built seven condominiums on La Palma Street in Pacific Beach. The seven Pacific Beach homes were priced from $490,000 to $649,000, and all seven sold out within weeks after their June 2009 release.
KB Home recently opened two new communities, KB Avellino in La Costa (86 homes planned), and KB Oakmont in Fallbrook (65 homes planned). Avellino is a townhouse development perched above the La Costa Resort and Spa Golf Course. Prices range from $486,990 for 1,615 square feet, to $516,990 for 2,246 square feet. Oakmont is a community of detached single family homes with floor plans from 1,687 square feet to 2,246 square feet, and prices starting at $375,490. KB’s “Built to Suit” program has helped improve their results by allowing buyers more flexibility in choosing which house they prefer to have built, and on which lot.
Home builders with an excess of inventory at higher price levels have not fared as well. As of July 31, there were a total of of 871 single-family homes for sale in San Diego, in 83 separate developments. This represents 14 weeks of supply, which is relatively low for a healthy market. And with building permits down more than 32 percent from 2008 levels, there is no indication that the inventory of new homes will be growing anytime soon. New homes sales in San Diego are expected to be several hundred below the 2008 total of 2,770 which had been the lowest volume in 40 years. But as inventories shrink, prices are expected to stabilize and possibly begin to rise. Already some San Diego new homes builders are reporting that they have increased prices as much as 3% with their most recent phased releases.
Geoffrey Schiering (J.D./M.B.A. Broker/Realtor) specializes in San Diego luxury homes transactions in La Jolla, Del Mar, Carmel Valley, and Rancho Santa Fe. The Schiering Team at Keller Williams Realty provides
Good news about Shea selling seven homes in one day in their community in Escondido – it sounds like things are going really well in San Diego. Hopefully, the higher priced homes start moving too. This is the first I’ve heard of KB’s “built to suit” program; it seems like builder’s are finding success in offering more customization.