A major economist is optimistic about the San Diego housing market.  National Association of Realtors (NAR) Chief Economist Lawrence Yun is optimistic that the local San Diego housing market is turning around.  He attributes this to a federal tax incentive and a leveling local housing inventory.

Speaking at a luncheon hosted by the San Diego Association of Realtors (SDAR), Yun was confident that the worst is probably over in regards to the San Diego housing market.  He remarked that home values fell so hard that hesitant buyers are now investing, seeing what a great opportunity it presents.

SDAR President Erik Weichelt, who opened the event, agreed with Yun’s assessment of the housing market.  He mentioned that there was an abundance of homes on the market, but that he believes there are more buyers than the current inventory offers.

Yun presented statistics that revealed rising home sales in San Diego within the past year.  According to the expert economist, homes sales increased by 11 percent in June 2009 compared to June 2008.  Listing prices, however, were down by 13 percent during the same time period.  The median price of a home was $362,000 in June 2009.

Primarily, the reason sales were up was due to the Housing and Economic Recovery Act of 2008 (HERA), expanded by the Obama Administration in 2009.  HERA provides $8,000 in tax rebates for first-time homebuyers.  Many who were waiting for home values to decline are now participating in the program.

Lower home prices and a tax rebate are making the home buying opportunity more than many first-time home buyers can resist.  Based on the combination of incentives, Yun noted that the previously overwhelming inventory is now being reduced, to a great extent, by new homebuyers.

He also attributes the decline in inventory to multiple bids offered for much of the low-end homes and a strategy by Fannie Mae and Freddie Mac to hold back inventory in order to prevent flooding the market.  According to Yun, unreleased inventory is not currently included in current data, so the demand is still overriding the current supply.

Yun is sure that an increase in foreclosures will continue nationwide due to job loss and growing numbers of underwater homeowners.  He stated that government intervention in forcing lenders to delay foreclosure action has halted the flood of additional inventory.  Sure that this is what contributed to the current shortages of homes on the market in San Diego, Yun says that demand is still high in San Diego.  In fact, he went so far as to say that San Diego foreclosures now have ready buyers.

Noting that the signs of recovery are so strong, Yun declared, that the upswing in the San Diego housing market may lead to a nationwide recovery.  The NAR economist said that as housing inventory continues its decline, the residential real estate market will begin to experience a more steady, 5-percent annual increase.

With this new information, it might be a good time to look for San Diego, CA Homes for Sale.