San Diego Real Estate market overview

SAN DIEGO REAL ESTATE MARKET OVERVIEW AND FORECAST FOR 2021

Denise Matthis

Most of the housing markets this year have been so unpredictable than in previous years, and the San Diego housing market is no exception. In part, due to the slow sales and also due to the growth in both the number of jobs and the wages. As such, if you are thinking about investing in this housing market, there is something that you need to know about the San Diego Housing market.

Nonetheless, one thing you have to always keep in mind is that the San Diego market is full of surprises as the city and its metro are known for their technological prowess, and more people are moving into the city to fill up the vacant job positions or even to start their businesses. One cannot talk about san Diego without mentioning tourism. The city has been known to attract thousands of people from other places, which has significantly boosted its economy; however, we are seeing shifts to courting more professional, biotech, IT, and telecommunications establishing a significant base for the city’s economy.

ABOUT SAN DIEGO

San Diego is a walkable city in San Diego County with a population of 1,305,700 people. This makes it the second biggest city in California and places it among the top 10 biggest cities in the country. in terms of growth, San Diego city has been experiencing rapid growth, and its economy remains relatively strong. Nonetheless, in terms of real estate, the city has often been overlooked in favor of other hot markets such as the San Francisco and Los Angeles markets.

Due to this simple fact, this makes San Diego, a perfect investment choice for most people. The city continues to outpace most other cities in the state, especially when it comes to job recovery, which is very good news for the residents of the county and also for the housing markets. The city’s housing market 2020 continues to be one of the hottest in the nation. In fact, Zillow ranks the city in the 10th position nationwide.

SAN DIEGO REAL ESTATE APPRECIATIONS RATES

In the past decade, the appreciation rate has been at 5 to 6%, which puts San Diego in the top 10% nationally in terms of real estate rate appreciations. In the last quarter alone, the appreciation rates in San Diego were at 0.94%, which amounts to a 3.79% annual appreciation rate. Since last year, and despite the public health crisis impacting the world, housing prices have been growing at a moderate speed.

On the other hand, rents in San Diego have also recorded a rise year-over-year, rising by 4% as compared to the previous year. Zillow.com surveyed the county’s housing market, and according to the report, San Diego was expected to be among the hottest housing markets in California. However, 29 percent of the people surveyed believed that the San Diego home values were to fall during this year.

In over two decades, that is, from 1998 to 2018, the median home values in the county of San Diego rose exponentially by 217%. However, the median household incomes grew only by 77% in the same time frame.

SAN DIEGO HOUSING MARKET: MEDIAN HOME PRICES AND THE EFFECT OF COVID-19

Overall, the San Diego housing market remains a seller’s market, and that means that the demand from the buyers is exceeding the current supply of homes available for sale. This is not something new as we all know that the state of California has been struggling to build more units putting upward pressure on the home prices.

Home prices have been rising, and during this phase, the market has skewed more in favor of the sellers. Shortage in homes for sale and an increase in the demand for the housing will continue to push the prices even higher. In March this year, the median sold price of existing single-family units was $675,000, which translates to an 8.2% increase year-over-year.

As the COVID-19 crippled the world economy, counties in the united states were not spared. Especially given the weight of the ‘shelter in place’ orders. The San Diego housing market has suffered the impact of the virus as buyers are withdrawing from the market and sellers pulling down their listings from the market. The uncertainty created by the virus played a role in slowing down the market activity in San Diego. Additionally, the market has also experienced difficulties in closing due to financial issues as loans and funding have also slowed down. From Early April, sales were relatively down, and the market is yet to recover fully to match last year’s activities. Nonetheless, the market remains relatively very strong.