With San Luis Obispo real estate sales continuing to languish and mortgage rates incredibly low, it's still a buyer's market from San Miguel to Nipomo. In fact, the second half of 2010 could be just about the best opportunity to buy a home on the Central Coast in decades.
According to a local Realtor's blog, only 219 homes sold in San Luis Obispo County last month. Coincidently, that's the exact same number as the corresponding month last year. Sales aren't yet picking up, and buyers continue to be very much in the driver's seat when it comes to negotiations.
You’re really in luck if you’ve already signed a contract to buy a home in greater San Luis Obispo—real estate sales are aided for the time being by a move by the White House. President Obama just signed a three-month extension on a popular tax credit. First time home buyers can qualify for an $8000 tax credit while other buyers closing a deal on a new home can get a $6500 credit when escrow closes by September 30th. And with mortgage rates in the neighborhood of 4%, it's hard to imagine you'll find a better deal than the one you’re waiting to finalize now.
Even if you haven’t yet selected a home to purchase, you’re still likely to find a good buy. As reported in The Tribune recently, properties "in distress" still dominate the market. In the first quarter of this year, 39% of greater San Luis Obispo real estate sales were bank owned or short sale homes. (A short sale is one in which the lender agrees to accept less than the outstanding mortgage on the home--these can be notoriously lengthy and frustrating transactions.) According to The Tribune article, a large inventory of foreclosure properties is expected to persist through the end of this year.
Even more telling, The Tribune reported that there was a 16% difference between the average selling price of homes in foreclosure than homes not in foreclosure for the first quarter of 2010. A local broker commented for the article that this means buyers choosing a property in foreclosure received about a 16% effective discount. Even when a seller is marketing a home that's not in distress, they are forced to compete price-wise with those that are.
The sting of the real estate bubble bursting is still very fresh; it's important not to overextend your budget even in this advantageous market. But if you've been sitting on the sidelines waiting for the right time to by a home in San Luis Obispo County, this could be your moment.