San Diego Housing Market Hits Plateau as Inventory Surges and Sales Pace Slows
After nearly two years of continuous price increases, San Diego’s housing market has reached a pause in momentum. The median home price remained unchanged at $1,040,000 in March 2025, showing only a 1.96% year-over-year increase. This is a marked cooling compared to January’s 11.35% annual gain and February’s 6.12% bump.
Although price appreciation has slowed significantly, it’s important to note that prices have held above the $1 million mark for eight consecutive months, highlighting continued demand in the region. San Diego remains one of the country’s most desirable markets—especially among buyers seeking lifestyle, climate, and coastal access—but the shift signals a move toward more balance after a red-hot seller’s market.
April brought a significant inventory boom across San Diego County, giving buyers far more options than they’ve had in recent years. Available homes jumped 15% month-over-month, reaching 5,004 listings in April, up from 4,351 in March.
This isn’t a one-off event—inventory has been rising steadily for months, and today’s buyers now enjoy nearly double the selection compared to the same time last year.
So what’s behind this flood of listings?
Sellers capitalizing on high home values before potential market softening.
Homeowners seeking upgrades or post-pandemic lifestyle changes.
Realistic expectations setting in as mortgage rates remain higher than hoped.
The result? Buyers now have the power of choice, and that’s altering the market rhythm dramatically.
As expected with growing inventory, homes are spending more time on the market. In March 2025, the median days on market rose to 17, up from 12 days in March 2024, marking a 41.67% increase year-over-year. While this is only a slight increase from February’s 16 days, it reinforces a consistent trend: buyers are taking their time.
Still, a 17-day median is historically brisk. The market is not stagnant, but the frenzied pace of 2021–2022 has cooled. Well-priced homes in prime locations still sell quickly—but bidding wars and same-day offers have become the exception rather than the norm.
One of the clearest signs of a shifting market is the Months of Supply Inventory (MSI). This metric helps define whether a region favors buyers, sellers, or falls into a balanced state.
Below 3 months = Seller’s Market
3 months = Balanced Market
Above 3 months = Buyer’s Market
As of March 2025, San Diego’s MSI reached 3.2 months, up from 2.2 months in March 2024—a 45.45% increase year-over-year. This means San Diego has moved into balanced market territory for the first time in years. Interestingly, MSI improved slightly from February’s 3.4 months, indicating that seasonal buyer activity is still having an impact despite swelling inventory.
This new balance signals a healthy real estate climate: sellers can still move well-priced homes, and buyers now have breathing room, stronger negotiating positions, and far more choices than they did just a year ago.
San Diego’s real estate market is entering a new chapter. Prices have plateaued, inventory has surged, and buyers are adjusting their pace. For sellers, it’s still a good time to list—but realistic pricing and strong marketing are now essential. For buyers, the flood of new inventory and longer decision windows mean more negotiating power and less competition.
While this cooling trend reflects a nationwide pattern, San Diego remains a highly sought-after market with long-term value and growth potential. Whether you're buying or selling, now is a strategic time to engage with the market—armed with the right data and expert guidance.
📍Curious how these trends play out in your neighborhood? Let’s talk about your local market conditions and how to make your next move confidently.
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