San Diego’s Price Trends, Inventory Shifts, and Sales Activity in July 2024

The San Diego County real estate market continues to evolve, with price trends, inventory shifts, and sales activity reflecting the interplay of market forces and buyer behavior. Let's delve into the detailed analysis of the current real estate scenario in San Diego, examining the latest data for July 2024 and providing insights into the market dynamics.

Price Trends: Record Highs and Potential Contraction

In San Diego County, both single-family home and condo prices reached record highs in April and June 2024, respectively. This upward trend, fueled by persistently low inventory and strong demand, has defied the downward pressure from higher mortgage rates. Despite the typical seasonal price dip expected in the second half of the year, July marked the 14th consecutive month of year-over-year price growth for both single-family homes and condos. While new all-time highs are unlikely for the remainder of 2024, some minor price contraction is anticipated in the coming months.

Inventory and Sales Activity: Shifts in Supply and Demand

July witnessed a notable increase in sales for both single-family homes and condos. However, inventory levels showed a contrasting trend. Single-family home inventory declined slightly due to a month-over-month increase in sales and a decrease in new listings. This decline continues a trend that began in August 2022, with inventory stabilizing at a depressed level since March 2023, remaining 23% lower than two years ago.

The condo market, on the other hand, experienced a slight rise in inventory, driven by an influx of new listings and fewer sales compared to last year. Condo inventory is now nearly identical to July 2022, indicating a gradual shift towards a more balanced market.

Examining the Impact of High Mortgage Rates

High mortgage rates have undoubtedly impacted both supply and demand in the San Diego housing market. While buyers and sellers initially seemed to tolerate rates near 6%, the recent decline in rates could potentially stimulate sales activity. However, the typical seasonal slowdown in the housing market during this time of year may offset any potential boost from lower rates.

Months of Supply Inventory: A Balanced Market Perspective

The Months of Supply Inventory (MSI) metric, which measures the time it would take for all current listings to sell at the current sales rate, provides valuable insights into the supply-demand balance. In July 2024, the MSI indicated a balanced market for both single-family homes and condos. This balanced market reflects a harmonious equilibrium between buyers and sellers, with neither side holding a significant advantage.

Navigating the Evolving San Diego Real Estate Market

The San Diego real estate market is in a state of flux, with price trends, inventory shifts, and sales activity reflecting the interplay of market forces and buyer behavior. While prices remain near record highs, some contraction is expected in the coming months. The growing inventory in the condo market suggests a shift towards a more balanced market, while single-family home inventory remains tight.

Understanding the current market dynamics and consulting with real estate professionals can provide valuable insights for buyers and sellers navigating this evolving real estate landscape. Stay informed about market developments, analyze trends, and leverage the expertise of real estate professionals to make informed decisions regarding buying or selling a home in this dynamic environment.