Price of Existing Homes in San Diego Remains Flat for Ninth Straight Month : Real Estate: The rapid increase in the price of new housing has also slowed somewhat, as the San Diego market normalizes after a frenzy of buying.

The San Diego housing market continued to show signs of normalization in February as average prices of existing homes remained relatively flat for the ninth straight month.

According to sales statistics recently released by the San Diego Board of Realtors, the average sales price of an existing single-family home last month was $210,209, up 12% from the February, 1989, figure of $187,636.

But last month’s average dropped 3% from the $216,985 price posted in January, and was down from the $217,228 average price in June, 1989, said Marjorie McLaughlin, president of the San Diego Board of Realtors.

Although stopping short of calling it a buyer’s market, McLaughlin said consumers are refusing to pay prices set by “spoiled sellers. Today, a seller can’t just ask anything and get it, which was the situation a couple of years ago. Back then, no matter what (sellers) asked for, they got.”

The rapid price increases of new housing sold at the county’s subdivisions in past years has also slowed somewhat, according to Market Profiles, a San Diego-based research firm that, in tracking new sales, divides up the San Diego County market into halves.

In North County, the average price of a single-family home was $266,599 during the three months ended Dec. 31, up from the $257,310 average recorded during the previous three months and the $232,984 average price for fourth-quarter 1988, a 14% increase over the year.

In the southern part of the county, the average price of a single-family home was $259,814 during the three months ended Dec. 31, down from the $261,681 price posted in the previous three months but up 8% from the $239,573 average price during the fourth-quarter 1988.

William Fontana, a partner in Westana Builders/Developers of San Diego, said that describing San Diego’s market as “soft” is premature.

“The prices are certainly not going up as dramatically as they were,” Fontana said. “Prices have stabilized, but I wouldn’t describe this as a soft market. What we have is a normal market.

“Everybody was accustomed to the pace . . . in some cases (builders) were selling six or eight houses a week. Well that’s not normal . . . that’s dramatic. Typically (developers) sell 1 1/2 to 2 homes a week,” Fontana said.

“During the last two to three years people would put a unit out for sale, and, whatever it was priced at, it would sell. Well, that has ceased now, and we’re going back to a normal market.

Fontana expressed little concern about prices plunging because many cities throughout the county have recently imposed some form of growth-control ordinance. “That limits supply, which should keep the prices right up there,” Fontana said.

A recent survey conducted by the Meyers Group, a La Jolla-based research firm, parallels the findings of the Market Profiles survey. Meyers found that the countywide median price of a new single-family home sold during the three-month period ended Dec. 31 was $239,900, down from $249,900 recorded in the third quarter of 1989. However, the fourth-quarter 1989 median price was up 22% from the $205,000 median posted during the same period of 1988.

The median price means half of all houses sell at a higher price and the rest at a lower price.

Although prices for single-family housing moderated, those of new attached units, such as condominiums and townhouses, showed healthy increases over the year-ago figures. The median price of condos and townhouses sold over the three months ended Dec. 31 was $143,990, down from the $153,900 median during the third quarter of 1989, but up 31% from the $109,900 over the same period in 1988, Meyers Group said.

According to Peter Reeb, Meyers Group vice president, buyer activity at the county’s subdivisions slowed appreciably in the fourth quarter when compared to the same period the year before. For the three months ended Dec. 31, a total of 1,771 attached and detached units were sold countywide, down from 3,147 in the fourth quarter of 1988.

David Musgrove, executive vice president of Market Profiles, attributed the price surge of two years ago to fear of growth-control measures.

“Anticipating growth-control measures, people saw the potential of prices going up and supply running out, and they started buying,” Musgrove said of the recent “panic buying” that forced prices to skyrocket. “And it wasn’t people just in San Diego. You had people coming in from Orange County and buying, too.”

Although many cities approved growth-control measures, several restrictive measures failed, Musgrove said, relieving the pressure to buy. But prices of new homes still remain out of reach for many home buyers, making condominiums and townhouses attractive alternatives.

“What we’re going to see is a surge in townhomes,” Musgrove said. “It would satisfy the need of all those people who would like to buy a single-family home but can’t.”

Reeb of Meyers Group agreed: “The condo and townhome market is real strong . . . especially those units in the $100,000 to $160,000 price range. Condos in that price range are selling virtually anywhere in the county.

“One out of three new home sales is a condo or a townhome,” Reeb said. “Actually, one out of three resales is a condo or a townhome too.

Despite the slowdown in the growth rate of housing prices over recent months, the housing market in San Diego should remain robust, according to Rick McGill, manager of residential lending at Great American.

“Without question, Southern California has been a seller’s market in recent years, so any slowdown would seem like a move toward a buyer’s market,” McGill said. “What’s going on is, buyers are buying and sellers are selling. It’s not out of balance one way or the other. It’s a normalization of the market.”