Home and condominium sales dropped significantly in July and prices slid as rising interest rates took a bite out of San Diego’s housing market, according to the Greater San Diego Association of Realtors.
The association reported a 22.1% one-month drop in single family homes from June to July and a 17% drop in condo sales.
Prices also took a hit, with the median price of a single family home dropping from $980,000 in June to $969,000 in July and the median price of condos and townhomes dipping from $632,000 to $630,000.
“It’s no longer just putting it out there for an ungodly sum of money and thinking people are going to overbid,” said Association President Chris Anderson. “It’s balancing out, which is a good thing.”
Unlike the frenzied buying market of just a few months ago, Anderson said buyers are getting a little pickier and sellers are more willing to negotiate.
“A year ago, it was insane. You had offers that were absolutely to the sellers’ advantage in the sense that buyers removed all the contingencies, often even the appraisal,” Anderson said. “In my opinion, the market that we’re in now is better because it’s fair to both sides.”
Tiffany Torgan, a real estate broker and owner of Prestige Properties agency in La Jolla, said that people who gave up looking for a house are showing renewed interest now that there’s less competition.
“I’m just starting to see some buyers come out and stick their little toe back in the in the market and say maybe,” Torgan said. “We’re going back to normal, not a crazy market where there’s 15 offers on one house and you literally can’t get into it because there’s a line just to get in.”
With more people being priced out of the for-sale housing market, monthly rents in San Diego are climbing at record rates.
San Diego in August had the sixth highest rents in the nation among 100 cities surveyed by Zumper, behind New York, San Francisco, San Jose, Boston and Miami, according to Crystal Chen of Zumper, an apartment listing service.
Year over year, San Diego rents were up 24% for a one-bedroom apartment compared to August 2021 and up 16.2% for a two-bedroom apartment with a the median price of a one-bedroom apartment $2,430 and $3,080 for a two-bedroom apartment, according to Zumper.
New York had the highest rental rates in the nation in August at $3,780 for a one-bedroom apartment and $4,150 for a two-bedroom apartment.
Akron, Ohio, had the lowest rental rates at $640 for a one-bedroom apartment and $800 for a two-bedroom apartment.
“I think the soonest time the rental market in general is going to slow down will be when the winter months come as that is usually when we see a dip due to decreased demand,” Chen said, adding that “renters will be the most likely to snag a deal then since landlords often price down their units to fill vacancies before the holidays.”