The average San Diego condo price in downtown has increased 22% in 2005. This is amazing considering all of the hesitation a lot of buyer have had with fears of a real estate bubble. This strong increase is despite the increase in lower priced condo conversions weighing in.
When the San Diego condo market starting showing appreciation rates in the early months of the year pundits everywhere started talking about the "bubble". This is because the San Diego Condo market has seen such a dramatic rise in prices in the last 4 years. Looking back at history they thought certainly this rise would run out of steam. They were forgetting the demographic shift of people getting older and wanting the easy condo lifestyle. This coupled with the many many improvements to downtown that the local government is making.
Another reason for the rise in prices is the increasing quality (and therefore) prices of condos built. People will wait in line to pay top dollar for top quality. People are not waiting in line to buy lower quality condos because of the smaller size and generally fewer amenities. Demand breaks down as follows, view, location, quality followed by size. Looking for a condo that will stay near the front of the pack in terms of appreciation, buy a great view in a great location, of better quality and don't worry about size. If you buy a very large condo of average quality in a so-so area with no view you will have a hard time selling it and it will be at the bottom of the cost/sq.ft. for downtown.
What's in store for San Diego condos for 2006, decreasing inventory and more rising prices. To learn more about the reasons behind this look for upcoming articles from Mark Mills, RE/MAX Realtor and expert on San Diego Condos. Visit him at http://www.LiveAtTheTop.com The Source for Downtown San Diego Condos.
