According to a report that was released on Monday May 21st by First Republic Bank, luxury home values in San Diego have increased 0.8% between the first and second quarters of 2007 and have risen 3.2% from the same quarter a year ago.

“Values in the upper tier of the luxury market are particularly strong,” said Katherine August-deWilde, chief operating officer of First Republic Bank.

Although inventory in general is higher and market time is longer, luxury homes in San Diego are selling near or at the asking price. Since January of 2007, we have seen that there have been multiple offers on many luxury homes. There are a lot of buyers in this luxury market who are moving to San Diego from within and outside of California. The main reason that luxury homes hold or increase their values is that there isn’t much inventory of coastal properties in San Diego.

San Diego properties in First Republic Bank’s Prestige Home Index represent a cross section of luxury homes in Carlsbad, Coronado, Del Mar, Encinitas, La Jolla, Poway, Rancho Santa Fe, San Diego and Solana Beach and are valued at more than $1,000,000 and are 3,000 to 6,000 square feet in size, with 3 to 6 bedrooms and 3 to 6 bathrooms.