The current housing economy is like quicksand, and your property’s value is the unfortunate victim continuously sinking in it. Unfortunate global occurrences like the COVID-19 pandemic and the Russian war in Ukraine took a toll on the U.S. economy. This year, inflation rates in the U.S. have gone up to 8.3%, prompting the Federal Reserve to further increase interest rates by 4.33%. This chain effect impacts the housing economy as it becomes harder for potential buyers to borrow money, causing house prices to fall.
If you’re holding onto a property in San Diego, California, you might soon be out of luck as your property’s value is expected to further decline come 2023-2024. Although there’s still time and fair returns can still be realized, it may be best to sell your property for cash today. Read on to learn more about the California housing market and why you should sell your San Diego, CA house for cash now (today).
The Status of the California Housing Market
The California housing market, which includes San Diego real estate, isn’t in good condition. Real estate sales have been declining for almost a year and a half now — with current sales having a 30% average drop compared to last year’s sales.
More worrisome is the overall increase in housing inventory in 41 out of the 55 reporting counties. Affordable housing has sustained around 40% sales decrease, while luxury and premium estate sales dropped to almost 50%.
It’s not only actual sales that are in decline. Property value is also sinking. Just last month, median housing prices yet again suffered a 3% decline in value. Single-family homes and condos are being hit hard, with some already losing 28.3% of their value.
Inflation and soaring interest rates are the primary contributing factors for these declines, as only an estimated 13% of California residents can afford to purchase a home. Since inflation and high prices are forecast to remain in the coming years, it’s a safe assumption that housing prices and sales will continue to sink and stagnate.
Recession on the Horizon
Recessions are relatively uncommon, with only 11 recessions since 1948. However, with the current state of domestic and global affairs, economic experts and politicians are concerned about the possibility of another recession.
Some experts say that with the Federal Reserve’s seemingly unhindered drive to increase interest rates, it will take a little while for prices to soar to skyscraper levels. This would, in turn, cause severe contraction in the economy, resulting in a recession.
Some non-profit business organizations even conducted their own studies and probability models to predict if rescission is on the horizon. One particularly alarming study yielded a 96% probability that the country would experience a recession within the next year — the primary cause being the Federal Reserve’s interest rate hikes.
If these predictions come to fruition, it would spell disaster for the housing market. Studies conducted by Harvard University’s Joint Center for Housing Studies showed that real estate prices plummeted in all but one of the five recessions that happened since 1980. For every year that a recession subsists, a house loses an average of 5% of its value. The Great Recession was particularly devastating, with houses losing an average of 13% in value annually.
It’s best to start immediately. You can sell your property for cash to avoid this financial distress.
Why Sell Your Property for Cash?
The housing market is in a shaky position. Hence, you’d need help finding a buyer for your home who will agree to purchase your property at a fair price. Even if you find a buyer, they most likely can’t pay you in cash and will have to resort to potentially troublesome arrangements like financing or loan mortgages.
A cash buyer of homes like I BUY SD is a client or investor who purchases properties directly and with complete payment. These buyers also purchase properties as they are. Hence, sellers like you can save on costs as you don’t have to make any home renovation or remodeling.
Selling your property for cash will then result in a fast and hassle-free sales transaction. More importantly, it would cut you loose from your sinking property.
Get in Touch With I BUY SD Today
From declining house prices to a looming recession, the California housing market is standing on uneven ground. Sell your San Diego CA house for cash right now before its entire value collapses.
We at I BUY SD can help you out with that. We’re a proud real estate investment firm operating in Southern California. Since our inception in 2014, we’ve been buying hundreds of homes at fair and reasonable prices. We also buy houses as-is and deliver complete cash payments, with zero fees. Contact us now at (858) 218-0042 to sell my home fast in San Diego California.