A lack of data on market trends can lead to overpaying for a property or setting an unrealistic selling price. My real estate services transform market data into actionable insights, helping buyers and sellers develop well-timed strategies. This guide provides a comprehensive breakdown of San Diego housing market trends to reveal patterns and investment opportunities.
San Diego Housing Market Trends
Driven by relocations, industry growth, and lifestyle changes, San Diego’s housing market has unique rhythms that create distinct seasonal patterns and pricing opportunities. Knowing these trends is important for anyone looking to buy, sell, or invest in one of California’s most desirable and complex real estate markets.
These trends affect buying strategies, selling plans, and whether the market favors buyers or sellers.
Current Market Dynamics
Understanding the dynamics influences everything from property values and investment potential to personal affordability and lifestyle choices.
Shifting Inventory and Days on Market
The market is transitioning from a seller’s advantage to a more balanced environment. This is highlighted by a dramatic increase in available homes and longer days on market.
- Inventory has surged by 55% year-over-year. For sellers, this means you’re no longer competing against a handful of properties. Make your home stand out with professional staging and competitive pricing.
- The average days on market is 29 days. The lightning-fast sales of previous years are slowing, giving buyers the time they need to make well-thought-out decisions. Sellers should prepare for a slightly longer sales process.
- Inventory levels are up 28.7%, indicating a shift towards a more balanced market, offering buyers more options and leverage.
Median Price Trends for Annual Home Sales
The average sale-to-list price ratio remains a tight 99%. Homes are still selling very close to their asking price as buyers are now less willing to overbid.
San Diego County currently has the sixth-highest median home value in the state. Despite the annual increase, this indicates a consistent and strong appreciation in the median home price in the city.
For homebuyers, the strong appreciation indicates increased affordability challenges, as rising prices require larger down payments and higher mortgage payments. For sellers, this trend is highly favorable as it provides them with increased equity and potential for substantial profits.
| Timeframe | Median Home Price |
| 2025 | $1,020,816 |
| 2024 | $1,014,478 |
| 2023 | $933,639 |
| 2022 | $927,807 |
| 2021 | $783,095 |
Underlying Forces Shaping the Market
This section explores the macroeconomic and demographic factors that are redefining San Diego real estate, giving insights into the “why” behind the numbers.
Interest Rates, Inflation, and Affordability Challenges
The mortgage rates have a profound effect on purchasing power. Interest rates would need to fall to 4.43% for a median-income family to comfortably afford a typical home. It’s a key reason why price growth is moderating, as the market is being forced to find a new, more sustainable equilibrium.
| Challenge | Details |
| Mortgage rate shock | Rates increased to 7%+ |
| Lock-in effect | 81% of homeowners have <5% rates |
| Income gap | Required income 2.6x median CA income |
| Payment inflation | Home payments exceeded the 23% growth in average hourly wages |
Supply-Demand Imbalance and Demographic Shifts
More people tend to wait longer before buying their first homes due to high property prices in California. Even with population growth leveling off, more people are looking for homes than there are listings. This oversupply of homes in San Diego has consequences:
- New listings of homes for sale have increased by 4.4% year-over-year. This increase gives buyers more options to choose from, potentially slowing the pace of the market.
- Total listings have also seen a rise, climbing 14.5%. This indicates that inventory is building, shifting the market to a less competitive environment for buyers.
- Pending sales have decreased by 1.5% compared to the same time last year. This suggests that fewer buyers are successfully entering into contracts, which could be a sign of cooling demand.
The San Diego Outlook
Price changes and buyer leverage are creating new dynamics across different property types.
Market Trajectory and Price Projections
Seasonal patterns are expected to return, with a slower fall and winter market. This gives buyers more time to shop and sellers an incentive to list in the busier spring and summer months to maximize exposure.
Here are the median sale prices for three of the top-selling property types in San Diego. These home prices may experience modest growth in the future, with some small dips expected as the market settles.
| Property Type | Current Median Price |
| Single-family homes | $1,000,000 |
| Condos and townhouses | $681,000 |
Strategic Advice for Stakeholders
In terms of market direction, rising inventory levels and increased days on market give you a better chance to negotiate favorable terms. Steady demand in popular neighborhoods means you should research each area closely before making offers.
- Sellers need to price strategically from day one to attract buyers and avoid price reductions. With more inventory, buyers have more options and less urgency.
- Buyers now have more negotiating power and time to evaluate their options. This is an opportunity to be patient and work with an experienced agent to secure a home at a fair price and on your terms.
- Investors can focus on the rental market and consider long-term value areas. Consider investing in properties that offer good cash flow or exploring value-add opportunities like Accessory Dwelling Units (ADUs).
Related Questions
Is It a Buyer or Seller Market in San Diego?
The San Diego housing market is currently evolving into a buyer-friendly environment, but it’s not yet a definitive buyer’s market. With increasing inventory and a slower pace of sales, buyers are gaining more leverage and negotiating power, especially in specific segments.
What Advice Would You Offer to Buyers Looking to Enter the San Diego Market in the Current Climate?
Buyers should get pre-approved for a loan to fully understand their budget and increase their negotiating power. With more homes on the market, take the time to evaluate properties thoroughly and be prepared to make a competitive yet strategic offer.
What Should Sellers Consider When Listing Their Homes in San Diego’s Evolving Market?
Sellers should focus on competitive pricing and professional presentation to stand out in the evolving market. Investing in high-quality photos, virtual tours, and strategic marketing can attract serious buyers and help a property sell quickly and for a strong price.
Conclusion
Staying informed about housing market trends in San Diego gives you the competitive edge to recognize prime buying or selling opportunities and negotiate from a position of strength. Contact Kathleen today for a personalized, expert, and data-driven strategy for your next real estate investment.