Welcome to San Diego Blog | January 22, 2017
2016 Year in Review
2016 was our best year ever at Dannecker & Associates. With your support we were able to help 106 clients buy or sell homes in the greater San Diego area. With about 50% of those sales in the downtown market and others ranging from as far north as Oceanside to as far south as Eastlake and even a few across the pond in Coronado, we’ve truly covered the county.
We’ve added new technology that has helped us better serve our clients and our listings coordinator, Melissa Ayer who joined us in late 2015, has been a tremendous asset to the quality of the experience we are able to deliver to our sellers.
I’m very pleased with our advisory team as we still have long-time associates and consummate professionals like Brent Cole and Laura Wills Ochoa, but we’ve also added to the team with quality people like Jason Wallace, Robert Gmur, Nicole Justice, Sarah Faherty and Matt Forness. I’m extremely proud of our team because the camaraderie and level of care with helping each-other has really made it so our clients can get what they need when they need it while our agents can have a life and enjoy their family time, vacations, professional development and a little time away from the phone from time to time.
We are very fortunate to have our main office located in Downtown San Diego in the fastest developing area of East Village. In January of 2016 we opened our 2nd office location at the Doma Building in Little Italy on at 1774 Kettner. It’s been a very exciting year and we couldn’t be in a better position to help more clients by providing an amazing real estate experience in a market where there are new projects sprouting up like weeds all over the place.
2016 was the 6th straight year of positive gains for real estate in San Diego
As far as residential real estate for 2o16, the underlying theme was that it was a seller’s market place on account of very low inventory across the board. A balanced market usually yields a 5-7 month supply of homes. Real Estate markets like Downtown, Little Italy, North Park, South Park, Banker’s Hill, Hillcrest, Mission Hills generally hovered around a 1.75 – 2.5 months supply of homes so buyers truly had to compete for the limited number of properties to purchase. And with interest rates bouncing around all time lows for most of the year, the buyer to buyer battles were worthy of engagement.
San Diego Real Estate Appreciation in 2016
Across the county, the median sales price was $485,900 and appreciation was 6.2%. Downtown and Little Italy the market had a median price of $626,000 and an appreciation of 4.8% from the year prior. 2016 was the 6th straight year of positive gains for real estate since the market bottomed out in 2011.
For 2017 we expect a very similar year to 2016, but local economists like Alan Nevin and Gary London expect appreciation to flatten out some (3-4%) because interest rates going up will likely keep values on a slower trajectory as the cost of ownership goes up with the higher rates. Fundamentally, the population in San Diego continues to grow and the job market is looking strong, but we’re not seeing a substantial amount of new homes being built so this will continue to put upward pressure on housing costs.
In Downtown and Little Italy, there are residential projects under way in many locations, but with the exception of two high-rise buildings that Bosa Development is building, Pacific Gate and Savina, all of the projects are apartments and are not for sale. Pacific Gate is the most expensive building that San Diego has ever seen and Savina is also a luxury high-rise tower. Both of these properties will really only cater to the top 5% of income earners and they don’t even begin to scratch the surface of the housing shortage.
Up on Banker’s Hill, it’s much like downtown with Luxury mid-rise and high-rise condos for sale like 41 West, The Park and Vue on 5th. All of these target the upper end of the market and they aren’t really making a noticeable impact on the market for most local San Diegans. They tend to cater to baby boomers that have done well financially and are moving to San Diego to enjoy our fantastic year round weather, state of the art medical facilities and a lifestyle that is hard to match in the USA.
Places like Northpark, Mission Hills, Hillcrest and Golden Hill are seeing some small new infill developments that mainly consist of a few new town homes here and there or the occasional apartment to condo conversion like Deca located on Park Blvd in North Park, but again the number of units being added is so limited that it really doesn’t begin make a real impact on our housing shortage.
When reflecting upon 2016, the highlights lead to the fact that Downtown San Diego is really growing into a viable downtown area. These highlights include:
- The announcement that USCD will open a satellite campus in East Village – every other major metropolitan area has a university so this was monumental.
- The Ritz Carleton Project Approved – San Diego’s first 5 star hotel
- The Idea District has it’s first ground breaking with IDEA1 and Maker’s Quarter Silo is under way with Broadstone Apartments under Construction
- Ball Park Village – a huge mixed use project with apartments, office space and retail went from a hole in he ground to about 15 stories up and a scheduled 2017 completion.
- Urban Discovery – downtown’s satellite elementary school has grand opening
- Pinnacle at The Park starts construction on their 2nd massive tower
- Lennar Homes breaks ground on their 460 16th Apartment project.
- Pacific Gate reached about 35 stories at the end of 2016 and Savina was excavated and the foundation was poured and parking structure underway as we finished 2016.
- Doug Manchester announed that he’s back on track to build the west coast of the US’s largest development in Manchester Pacific Gateway
- New State Courthouse almost completed
- The Carnitas Shack opens at The Embarcadero
The Marina District
- Port of San Diego announces they are putting Seaport Village out for request for proposal for redevelopment.
- Nordstroms closes down at Horton Plaza
- Port opens new access point to Bay between Marriott Marquis and Hyatt Manchester Grand
- Grand opening at Horton Plaza Park
- Piazza Famiglia project tops out and will be completed in 2017
- Grand opening of Brian Malarkey’s Herb & Wood restaurant
- Re-opening of Craft and Commerce & False Idol
- High-rise apartment project on corner of Columbia and Ash breaks ground
- Hotel at Fat City Grand Opening
- Little Italy Public Parking Structure on Beach & Kettner Opens
- Ground breaking for Bayside Fire Station
- Blue Sky high rise apartment building completed between 8th and 9th and A & B Streets – Zephyre Partners.
- Low income housing tower completed at 5th and Beech & Cedar.
Overall 2016 saw a lot of positive growth in Downtown and surrounding communities. We may have lost our Charger’s, but we haven’t lost our soul. San Diego is a special place and while LA can take our Chargers, they’ll never be able to create our small town feel in a big city environment and for that we are grateful.
We wish you a prosperous and epic 2017 and are here to help with all your real estate needs. Shoot us a message, drop by or give us a call.