Rising rents and slowing home appreciation in San Diego County have reduced residents’ confidence in the local housing market according to Zillow, the Seattle-based real estate marketing company.
San Diego renters and homeowners, included in a poll of 10,000 people in 20 metro markets conducted in July, were ranked 12th in housing confidence over the next year, down from seventh when last polled in January.
The ranking, drawn from 31 questions asked in the telephone survey, shows the following:
8 percent of renters said they plan to buy in the next year, down from 10 percent, a reflection of rents rising faster than incomes;
69 percent of homeowners believe homes in their area will be worth more in 10 years, compared with 75 percent when asked in January, a sign that they think appreciation is slowing;
45 percent of adults said now is a good time to buy, down from 50 percent, possibly because renters are having a tougher time saving for a down payment in the face of rising rents and prices; and,
61 percent of adults think it’s a good time to sell, an acknowledgement that they may not be able to do much better on the sales front than today.
“We’re still seeing a very healthy housing market,” said Zillow’s chief economist, Svenja Gudell.
But she said San Diego is not as “exuberant” as Denver, whose confidence ranking rose from eighth to third and whose renters were nearly twice as hopeful of buying as were San Diegans.
However, Gudell said San Diego’s price increases are occurring at a more sustainable rate.
“I do think it is a good time for us to start the slowing process and make sure we give people the opportunity to transition from being renters to owners if they want to,” she said.
Looking over the next year, Gudell said some markets will likely remain relative flat in home appreciation. Her forecast for San Diego is a 1.9 percent increase between July 2015 and July 2016.
This is the fourth semiannual poll Zillow has conducted to gauge owner and renter attitudes, so it is not yet possible to determine if seasonal factors figure into January and July answers, Gudell said. But she said the survey is conducted in the same metros and uses the questions each time.
