San Diego is poised for double digit increases in housing prices again. It may not happen in 2011 but will certainly happen before 2014 and look for more than a 50% increases in housing costs over the next 3 to 4 years.
Why so much optimism? Many reasons, no building is going on in San Diego, yet the population keeps increasing. People are still moving to this fine city in droves and the military plans only expansion in the area 
which already is one of the largest military communities in the world.
Many of the wealthier Mexicans are moving in to San Diego County to get away from the drugs and violence taking over their communities.
Oh and San Diego is a huge college town and will continue to be. College towns always fare well during recessions. Biotech a major
source of stability and is expanding and the small amount of manufacturing is stable and will remain. It is mostly defense oriented. San Diego has a huge convention and visitor business that will continue to grow.
But…..there are no residential units being built and none in the foreseeable future. With Pendleton to the north, the Ocean west, Desert east and Mexico to the south, San Diego County will need to build up much more than out.
Currently, it cost more to build the units in San Diego County than they can be sold for. So the builders have all left and we’re not sure when they will return.
It is true that as the prices increase, many of those who wanted to sell over the last few years will put their units on the market, but that won’t support the huge demand. As people pay the higher prices, the inventory will be gobbled up and there will be further upward pressure on price.
Right now in San Diego County there is a 3 month supply of inventory to meet current demand. Six months inventory is a balanced market so we are already starving for units to sell.
The moral of the story is, buy anything now! The interest rates are at the lowest in our lifetimes. The prices are still at amazingly low levels.
Call me and even with this low inventory, we’ll find something that will work for you.