The Markets in a Minute
September 15, 2016
Opinions vary on the likelihood of a Fed policy rate increase at next week’s meeting. Markets are volatile as traders prepare for what they think will happen. Central bank economic stimulus overseas has been helping U.S. bond yields remain low but is now waning. Higher bond yields could cause mortgage rates to increase. A strong jobs report and firming inflation pressured rates and fueled volatility this week. On the flip side, retail sales slumped.
According to CoreLogic, 548,000 homeowners regained equity in Q2. That brings the percentage of homes in the U.S. with positive equity to almost 93%. Foreclosure inventory continues to dwindle. CoreLogic reports that foreclosure inventory declined 29.1% in July, and was down 16.5% year-over-year. Mortgage applications for purchase transactions were up 9%, signaling a stronger fall market ahead. Although up slightly, mortgage rates are still near record lows.
San Diego County Rentals
Average rent was $1,743 a month in San Diego County at the start of September, increasing 8.4 percent in a year. The vacancy rate dropped to 2.17 percent, its lowest level in roughly five years.
Rent increased 7.7 percent from March, when the average was $1,618 a month. The rise is largely attributed to lack of new housing and apartments. Only two new major projects entered the market in the past six months, adding 370 apartments.
Blame for lack of housing has been placed rising prices on California environmental laws, lack of political leadership and the hesitancy of city and county government to approve new housing. There is no expected change in foreseeable future.
In early September, the average rent for a studio was $1,383; $1,533 for a one-bedroom; $1,821 for a two-bedroom; $2,257 for a three-bedroom; and $3,043 for a four-bedroom. The highest rent in the county is on the coast in North County, where the average rent runs $2,152 a month. The cheapest is in East County, at $1,422 a month. Vacancy rates for apartments in East County are at only 1 percent. Out of 18,622 apartments, just 275 were empty at the start of September.
San Diego Community Spotlight
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