Coronado Homes For Sale
There are currently 321 homes for sales in Coronado, CA, which is significant because at the same time last year there were much fewer Coronado homes on the market. Herein we will explore the reasons why Coronado is facing a high supply of listings as well as we will examine the impact this oversupply will have in the Coronado Real Estate market.
What caused the Oversupply of Coronado Homes
1. The liquidity crisis: The availability of funding is critical for homeowners to make home purchases; without it, homes don¡¯t sell and listings pile up. In 2008 there were extensive period where the only Coronado real estate transactions closing escrow were all-cash transactions. Of course, very few people can afford to buy Coronado homes where the average price point is around $1,500,000? in all cash. As banks began making financing available, the focus was on adding liquidity for homes priced under $700,000, which did little to help the Coronado real estate market. Currently liquidity is returning, and homes can be purchased with as little as 20% down but only if they are primary residences. Thus, primary home buyers are back in the market but in Coronado a high percentage of buyers are vacation home buyers from out of state (mostly Arizona).
2. Consumer Fear: When the stock market dropped 40%, who feels comfortable investing in Coronado real estate at pre-market collapse prices?
3. Owners of Coronado Homes: Coronado home owners were unrealistic about the value of their properties. Sellers insisted on pre-market-collapse prices and there was consistently a gap between their minimum price and the maximum price buyers of Coronado homes or condos were willing to pay.
Impact of the Oversupply
When supply rises disproportionately to demand, prices fall. Prices have indeed started to fall. In the first quarter of 2009, Coronado real estate prices on closed transactions fell 27% relative to the same quarter in 2008. We expect prices to level soon and then stabilize over the course of a year or so. If prices drop further this year, which they might, the impact should not be as dramatic as the impact we have seen in the first quarter of 2009 relative to 2008. The reason Coronado real estate prices should hold better moving forward is that demand for Coronado homes rises in the Spring and peaks in the summer, meaning many of the listings currently on the market will turn into proud new homes for Coronado buyers.
About CoronadoHomes.biz
Coronado homes.biz is an information site for consumers who are interested in Coronado homes for sale. The purpose of this site is to create blog-like entries on the greater Coronado real estate market. This site is currently being written by an objective source who studies the market for Coronado homes and condos but does not actively participate in it as an agent or broker (at least as of the publishing of this article!) Through education, we can make smarter decisions on Coronado homes for sale.