November and December traditionally mark a slowdown in real estate activity; however, this year shows no signs of slowing, even in the luxury markets. Driven primarily by low supply and high demand and consistently low interest rates, the market continues to defy COVID-19.
According to Julie Feld, Realtor with Pacific Sotheby’s International Realty, the luxury real estate market has remained extremely active. Feld recently sold two record-breaking properties in Rancho Santa Fe, one of San Diego County’s most well-known luxury communities. 7688 St. Andrews Rd recorded the highest selling price in the gated community of The Farms since 2014, selling for $4,300,000. 7717 Briza Placida, located in the Lazanja area of Santaluz, closed at $2,350,000, marking the highest price per square foot EVER, in this section of Santaluz.
“As tragic as the pandemic has been, it has been good for real estate values in San Diego. Record numbers of buyers, who are now able to work remotely, are relocating to San Diego County from Seattle, San Francisco, LA, and other parts of the nation to enjoy the lifestyle advantages San Diego provides,” explains Feld. “With interest rates at record lows, we are also seeing more San Diegans “buying up,” as larger homes and outdoor space have become more important. These factors have combined to drive up demand — and prices — for luxury real estate in North County San Diego.”
The housing market continues to be a sign of strength in the U.S. The S&P CoreLogic Case-Shiller index of property values increased by 3.9% from 2019, beating the estimate of 3.6%, which was the biggest year-over-year increase since December 2018. Housing demand in San Diego County is up 20% over 2019, the highest level recorded since 2012, while expected market time the lowest since 2012 at 32 days overall.
Low mortgage rates, strong buyer confidence, and lack of inventory are contributing to the active market and increase in home values across Southern California. “We see no signs of a downturn in home prices and expect values to remain strong across all price points for the foreseeable future,” says Brian Arrington, CEO, Pacific Sotheby’s International Realty.
The same is being seen across the United States. Recently, Sotheby’s International Realty reported that their agents closed more than $90 billion in sales and increased sales volume by 61.8 percent year over year through the third quarter of 2020 in the U.S. The changing needs of luxury customers during the COVID-19 pandemic played a key role in the sales volume explosion for the Realogy-owned global luxury brand.