All Real Estate is Local
Coronado, CA, September 18, 2007 – With the constant drumbeat of negative news surrounding the real estate and credit markets, one would think that lower housing prices are to be found everywhere. They would be wrong.
Somewhere housing prices are trending down; the news reports aren’t making the numbers up. But, those are aggregate figures, factoring all sales of all types of products, in all types of markets.
In high end, oceanfront resort communities such as Coronado, single-family homes continue to appreciate, even with the onslaught of constant negative press. Cursory research would seem to indicate that even in Coronado, average sales prices are declining. But a detailed look behind the numbers tells a very different story.
Originally conceived as a resort town by the developers of the Hotel del Coronado, the village across the bay from San Diego spent its first 80 years as a sleepy Navy town accessible only by ferry or a twenty-five mile drive around San Diego Bay. The future of Coronado took a decided turn in 1969 with the opening of the Coronado-San Diego Bay Bridge and easy access to the “mainland” meant that the town slowly, but surely, returned to the founder’s original vision: a resort town.
Coronado has three distinctive market areas, The Village, the Coronado Cays, and the Coronado Shores, and within those markets the segments are refined further to single-family detached homes, condominiums, “cloud” condominiums, and condominium conversions. How sales in these segments are reported often determines the real trends.
Winning the title of America’s Best Family Beach by the Travel Channel, Coronado has fully metamorphed from Navy town to oceanfront resort. In the last three years a high percentage of the luxury homes (above $2-million) have sold as vacation homes with the vast majority from Arizona. Hailing from primarily the Scottsdale and Paradise Valley areas, these buyers have a special affinity for the Village. Other western areas such as San Francisco, Houston, and southern Nevada are also heavily represented. They are attracted by the weather, the oceanfront, the bayfront, and easy proximity to downtown San Diego and all its cultural, entertainment, and athletic offerings.
Award-winning resort homebuilder John O’Brien of Flagship Properties notes that, “By any measure, detached, fee-simple homes in the Village of Coronado continue to increase both in price and demand. The average price is up in 2007, the median price is up, the cost per square foot is up, and sales of homes over $2-million continue to be absorbed at the rate of over three per month.” O’Brien knows of what he speaks. Flagship Properties has built its business model on serving the new (Resort Town) Coronado and has, since 1998, built, remodeled, and sold dozens of luxury resort homes in the Village of Coronado.
Through the first six months of 2007 the average price of luxury single-family detached homes has increased by 4.3% while the median price has risen 3.1%. These increases are all on top of an 8% increase in 2006 over 2005.
O’Brien continues, “Good times or bad, someone always wants to live on the Pacific Ocean. Flagship will continue to serve the luxury resort market because, first, it’s what we do best, but also, because our experience over many market fluctuations has confirmed that resort homes hold their value better than many other alternative investments.”
His final advice, “If you want to live near the beach, particularly in Coronado, it’s a great time to buy.
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- John O’Brien
- Flagship Properties
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