San Diego New Home Prices Plummet

The San Diego Review Tribune reports:

The January median for new housing came in at $435,000, a record $104,500 less than in December and $22,000 less than in January 2005. The month-over-month decline represented a near-record 19.5 percent drop, the biggest since July 1997's 24 percent change.

Karevoll said the drop probably reflects two factors: the typical rush by big builders to close sales of new homes in December, before the start of the new year, which is followed by a lull in January; and the continuing sales of low-cost condo conversions built by firms that did not need to close sales by year's end for tax or stockholder purposes.

Eastern Chula Vista's ZIP code 91913, which includes parts of Eastlake and Otay Ranch, was one of several areas that best showed January's erratic market performance.

There, on the resale side compared with January 2005, the median price for single-family homes rose 12.1 percent to $656,000 on 22 sales while the median price for condos dropped 9.5 percent to $405,000 on 13 sales.

But in new housing, the median price for the area dropped a whopping 48.6 percent, plummeting from $725,500 last year to $373,250 this year.

What goes up can go down.