And With That...The 2022 Season Comes To An End

A Look Back at The Housing Market in San Diego, CA

The real estate market in San Diego, California saw strong demand and limited supply in 2022, leading to increased home prices and a competitive market for buyers.

According to data from Zillow, the median home value in San Diego increased by 11.9% in 2022, reaching a median value of $863,100. This trend was seen across the city, with all neighborhoods experiencing some level of price growth. The downtown and coastal areas saw the highest price increases, with many homes receiving multiple offers and selling above the asking price.

With a limited supply of homes for sale, we saw this as a significant factor driving the market. The number of homes for sale in San Diego decreased by 23.5% in 2022, as compared to 2021, making it difficult for buyers to find options. Partly due to the high demand for homes as well as the limited number of new construction projects.

What Contributed To Our High Demand?

There are several factors that influenced the strong demand for real estate in San Diego, California:

1. Strong economy: San Diego has a diverse economy with a mix of industries, including technology, defense, healthcare, and tourism.
2. Desirable location: San Diego is known for its mild climate, beautiful beaches, and outdoor recreational opportunities, which can make it an attractive place to live.
3. A limited supply of homes for sale: The number of homes for sale in San Diego decreased by 23.5% in 2022, making it difficult for buyers to find options and contributing to strong demand.
4. Low mortgage rates: (Relatively) low mortgage rates made it more affordable for buyers to purchase homes. If you remember, we kicked off January - April with mortgage rates still under 5% on a Conventional 30-year Mortgagee!
5. Population growth: San Diego has experienced population growth in recent years, which can lead to increased demand for housing. -- According to data from the U.S. Census Bureau, the population of San Diego County increased by 2.3% between 2010 and 2020, from 3,095,313 to 3,177,063. This equates to an average annual growth rate of 0.23%.

The competitive market made it difficult for buyers, particularly first-time buyers, and those with lower budgets. Many buyers found themselves in bidding wars or paying well above the asking price to secure a home -- resulting in a fast-paced market, with homes selling quickly and often with no contingencies.

Despite the challenges, the San Diego real estate market is expected to remain competitive in the coming years, with prices expected to continue rising.

What We Can Look Forward to in 2023

I like to say that "my crystal ball is broken", however, the real estate market in San Diego will for sure evolve in 2023.

Based on current market trends and economic conditions, it is possible that the market may continue to see strong demand and limited supply, leading to further price appreciation.

Factors that could influence the market include the overall strength of the economy, population growth, and the level of new construction activity in the area. If the economy remains strong and there is continued population growth in San Diego, it could lead to increased demand for housing and potentially further price appreciation.

On the other hand, if there is an increase in the number of homes for sale or a slowdown in the economy, it could lead to a more balanced market with less upward pressure on home prices.

It is also important to note that real estate markets can vary significantly by neighborhood and property type. Some areas and types of properties may see more pronounced price appreciation or changes in market conditions than others.

Overall, it is important for buyers and sellers to keep an eye on market trends and economic conditions, and to work with a real estate professional who can provide guidance and help them make informed decisions.