Homes Prices on the Rise in San Diego - June 2023

The housing market here in San Diego continues to rebound as we head full steam into the spring and summer selling season. But you're probably still hearing doom and gloom in the headline news, so let's get after what is really happening with home prices here in San Diego and what this means for you if you're getting ready to buy or sell a home.

Hey everyone, home prices continue to rebound here in San Diego, and we're covering exactly how much they've gone up and what that means for you if you're either looking to buy or sell a home in the coming months. Now, this is probably completely different from what you may be hearing in the mainstream news. You're probably hearing that the housing market is crashing as home prices are in an absolute free fall. Well, there are a couple of reasons for this.

Basically, the news is always looking at data that is always lagging a couple of months behind, and they're strictly comparing it to what home prices were one year ago. Now, I track home prices every single month and actively sell homes here in San Diego, so I have firsthand knowledge of what's actually happening in negotiations with buyers and sellers. So let's get after what is really happening with home prices and if we are in a buyer's market or a seller's market.

My name is Curtis Chism with the Chism team, brokered by eXp Realty, and if you're looking to make a move, all you got to do is just give me a call, text, or email, and let's chat. Or if you know someone looking to buy, just pass this video onto them and have them give me a call.

Now, we all know that mortgage rates are certainly the main driver of the housing market, and rates have shot up over the past year. And this happened not only because the Fed was hiking interest rates but also because of how high inflation was. Now, mortgage rates are directly tied to inflation. When inflation was at nine percent a year ago, mortgage rates had to catch up to that number. Now it's actually a relief that mortgage rates only ever got as high as six percent and didn't actually hit nine percent. Now, that would have completely crushed the housing market. Now, rates have stabilized around the high six percent mark, and inflation fell again this past month to four percent, and it looks like it's going to continue to fall over the coming months. Mortgage rates should continue to fall as inflation falls as well.

Now, since mortgage rates have stabilized, the buyer market has really come to grips with current mortgage rates, and buyer activity has picked up. It did cool a little bit there for a bit with the national debt ceiling debate going on, but it appears to have picked up once again. Now, if mortgage rates do fall in line with falling inflation, I'd expect buyer activity to really start picking up, and with that, home prices will continue to rise.

At this point, those stabilized mortgage rates are reflected in our housing prices here in San Diego. So let's get after home prices here in San Diego. Housing prices rose slightly to $955,000, up from $952,000, and we actually saw it bottom out several months ago back in January at a low of $850,000. So you can see right now that the news is reporting declining prices because they're comparing it to a year ago, but home prices already bottomed out and have been on their way back up for four straight months, already regaining $105,000 from the low. We're still off $45,000 from the peak back in April 2022.

However, something that's really interesting to take a look at is how prices have changed over the past few years. If you purchased a home in May 2022, the median price was $990,000, meaning right now, you're underwater four percent or about $40,000 on that sales price. But that doesn't really matter to you because you're probably not planning to sell anytime soon. If you bought two years ago in 2021, then prices were $865,000, so you're actually up $90,000 or ten percent. And if you bought just three years ago in May 2020, prices were $662,000, so you're up $43,000.

Inventory has risen again, so we're just under 3,000 homes, giving us just under two months of inventory available. And days on Market has fallen to 24 days on market, and that's showing that the time frame to sell a home is actually closer to the big boom we had back in 2020.

Now, I've been seeing buyer demand really pick up over the past couple of months, and we're seeing bidding wars on homes priced and marketed well. So if a home is overpriced, it's still taking a long time to sell. And the other data point I like to take a look at is the final sales to list price percentage. This tells us how much above or below the list price that homes, on average, sold for. If, on average, the final sales price is 98% of the original list price, it's considered a balanced market. Anything over indicates a seller's market, and below indicates a buyer's market. Here in San Diego, we're now at 101.3% final sales to list price, and each month, that has been climbing, giving us another indicator that we've swung back into what I would call a balanced-plus market, meaning it's definitely favoring sellers, but there still are a lot of homes that favor a buyer.

So what does that mean for you if you're thinking about buying a home? Well, if you are thinking about buying and you've been trying to time the bottom of the market, as you just saw, we already saw the bottom four months ago, and prices are definitely on the way back up. Now, fortunately, things are pretty stable. We're not seeing insane bidding wars overall, but for some homes, you may be the only bidder on it, and others, you might be up against several other offers. It really comes down to the individual home that you're looking at buying and then coming up with a specific strategy to secure that home. Now, that may involve going in with a very clean, full-price, or over-ask price offer, or it may be coming in asking for credits to cover your closing costs and asking for repair work to be done. And that's how I can help you navigate the buying process, help you analyze each home that you're looking at, and come up with a specific strategy needed to negotiate to help you buy your home. So just give me a call, text, or email, and we'll get started.

Now, if you are planning to sell a home, you really need to take a look at your home and come up with the right strategy to successfully market and sell your home. Just like for buyers, every home is unique, and it has its own strengths and weaknesses. Sometimes a home needs a lot of repairs, remodeling, and upgrades prior to hitting the market, like paint, carpet, landscaping, roofing work, and other times it just needs to be decluttered and really clean.

As we head into what I would call a balanced-plus market, you may need to plan to do some repairs that come up on the buyer's inspections or plan on giving them credits to help the home buyer buy down their interest rate to actually secure your home. And that's why it's just more important than ever that you give me a call so we can put together a customized plan to sell your home on the best terms that you're looking for. We'll make sure we don't overprice the home, causing it to sit for months. Instead, we'll price it with my proven strategy to generate tons of traffic online, which will turn into more showings, more offers, and then, hopefully, a video more, and that'll give you the leverage you need to get the price and terms that you want. If you are wanting to get an idea of what your home may sell for in today's market and what it should be stat, just contact me, and I'll run a no-obligation home value for you.

Well, that's a complete overview of the housing market here in San Diego. Leave me a comment, shoot me an email back, and let me know what you thought.