University of San Diego economist Alan Gin said he is optimistic about the housing market because the economy looks more promising.
“The economy is starting to rebound,” Gin said, “so the question is, can the economy rebound fast enough to save people from these foreclosures? Can enough new jobs be generated so people who are stressed out can find work and meet their mortgages? I think that’s going to be the conflict through much of 2010. Some people might be saved; others will not.”
Rick Hoffman, president of Coldwell Banker Residential Mortgage in San Diego, said his agents have seen more activity in the last few weeks from buyers and sellers, and not just because spring is always more active than winter.
“We can’t keep inventory in our Carmel Valley office,” Hoffman said.
But he characterized consumer confidence as weak.
“When you start looking statistically at prices that reached a floor and have come up a bit, consumer confidence always lags the actual statistics,” he said. “I don’t think the message has gotten to consumers that, hopefully, we’re off the bottom and maybe we’ve changed to a slight increase.”
Rich Toscano, a real estate market watcher at Pacific Capital Associates, said another measurement of price changes, cost per square foot, rose about 5 percent from February to March, double the median increase of 2.5 percent. He said that indicates a rise in value.
“I have a feeling that we are in a recovery of sorts,” Toscano said. But, he cautioned, “I definitely have concerns about the sustainability of the recovery.”
Most worrisome to Toscano and others is the outlook for interest rates. Last week, the Mortgage Bankers Association reported an average rate for 30-year fixed-rate mortgages of 5.31 percent, up from 5.04 percent the week before. Some economists believe that rate could reach 6 percent by the year’s end.