Entry-Level Homes Becoming Affordable to More Households

With median home prices down, more San Diego County residents can afford to purchase an entry-level home.

According to the California Association of Realtors’ First-Time Buyer Housing Affordability Index released Feb. 19, 31 percent of San Diego County households could have made an entry-level home purchase in fourth-quarter 2007 compared with 24 percent in the third quarter. In comparison, 33 percent of households in the state and 65 percent nationwide could afford entry-level housing in fourth-quarter 2007.

The minimum household income needed to purchase an entry-level home at $411,170 in California in the fourth quarter was $82,200, based on an adjustable interest rate of 6.21 percent and assuming a 10 percent down payment. First-time buyers typically purchase a home equal to 85 percent of the prevailing median price, according to CAR. The monthly payment, including taxes and insurance, was $2,740 for the fourth quarter.

In the county, the minimum household income needed to purchase an entry-level home of $444,480 during the same time period was $88,800, with monthly payments of $2,960. In the nation, the minimum income needed to purchase an entry-level home at $175,270 was $35,100, with payments of $1,170, according to CAR.

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Sluggish Home Sales:

Despite increased affordability, home sales have started out slowly this year. The San Diego Association of Realtors’ January sales report for existing homes indicates a 38.5 percent decline in sales volume last month from January 2007 for attached homes and a 28.4 percent decline for detached homes.

According to SDAR, the median price of attached homes in the county in January was $300,000; and $475,000 for single-family homes. The median price of attached homes was down 16.7 percent from January 2007 and 3.8 percent from December 2007. The median price for single-family homes was down 15.8 percent from January 2007 and 4.6 percent from December 2007.

SDAR President Lori Staehling said the economic stimulus package that raised the conforming loan limits to as high as $729,750 is crucial to boosting the housing market for California.

“For buyers, the change could mean a cut in monthly mortgage payments. For sellers, it could ease pressure to lower prices to attract buyers,” said Staehling.

In 2007, 15,645 single-family listings sold compared with 19,741 the previous year. Attached listings also saw a decline. A total of 8,904 attached listings sold in 2007 compared with 10,718 in 2006.

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Market Bears More Distressed Properties:

Declining median home prices and increased affordability have not slowed the number of distressed properties being listed for sale. According to Redwood City-based Movoto LLC, a real estate brokerage, San Diego County saw a 1.8 percent increase in distressed property listings from Dec. 31 to Jan. 31.

Movoto defines distressed properties as any property that has an agent note in the Multiple Listing Service listings that indicates the property is bank-owned, in foreclosure, real-estate owned by the lender or a short sale.

According to Movoto, 19.7 percent of all listings at the end of January were distressed properties. All other Southern California markets also saw increases in January from a month earlier. In Orange County, 28.9 percent of all listings were considered distressed properties; with 24.1 percent in Riverside County; 22.9 percent in Los Angeles; and 18.6 percent in San Bernardino County.

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NiteLites Opens Poway Outlet:

A national outdoor landscape lighting company announced the grand opening of its first California office in Poway this month. NiteLites, which now has 44 offices throughout the United States, specializes in the manufacturing and design of low-voltage lighting for both residential and commercial properties.

“NiteLites offers superior exterior lighting systems along with exceptional installation for applications such as architectural lighting, landscape and garden lighting, deck lighting, submersible lighting and path lighting,” said William P. Garland, owner of the Poway office.

NiteLites’ commercial lighting systems and products can be designed for clubhouses, pools and walkways at public facilities, parks, apartments, condominiums and other commercial projects.

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A Documented Change:

San Diego-based Master Manuals, a provider of document and information management solutions for the homebuilding industry, announced it changed its name to Compendia on Feb. 11.

Compendia means a vast storehouse of knowledge that is easily accessible. The name change reflects an evolution of technological offerings, including Web-based solutions for builders and homeowners.

Chief Executive Officer Steve Fabry said Compendia will provide the same services and solutions, including maintenance information management, manufacturer product warranty organization, homeowners association and community care services, and document retention for clients.

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