July 2024 Housing Market Update

July 2024 Housing Market Update

Addressing the Rumors: Are Home Prices Finally Coming Down?

Over the past few weeks, I've been flooded with questions about whether San Diego home prices are finally starting to drop. This surge in curiosity seems to be fueled by recent news reports suggesting significant market changes. Let's set the record straight with data from the latest San Diego County Housing report.

Fact-Checking Recent Claims

A recent news report claimed that the average days on market (DOM) for homes in San Diego County jumped from 43 days in February to 67 days in recent weeks. However, the actual data tells a different story. In February 2024, the average DOM for single-family homes and condos/townhomes was 31 days, not 67. It's always crucial to verify the information you hear, especially when making significant financial decisions.

Median Sales Price

For single-family homes, the median sales price in June 2024 was $1,191,000, marking a 99.1% year-over-year increase. Condos and townhomes saw a median price of $698,500, up 7.5% from last year. Historical data shows a consistent increase in prices:

• June 2022: Single-family homes - $975,000, Condos/townhomes - $632,000
• June 2023: Single-family homes - $1,000,000, Condos/townhomes - $650,000
• June 2024: Single-family homes - $1,191,000, Condos/townhomes - $698,500

Despite the slowdown in the year-over-year increase from 15.3% in April to 9.1% in June, the market remains on an upward trend.

Days on Market

In June 2024, the average DOM for single-family homes was 27 days, and for condos/townhomes, it was 29 days. This slight increase from May's average indicates a relatively stable market. However, remember that ultra-luxury homes priced over $5 million generally take longer to sell compared to homes priced below $2 million.

Inventory of Homes for Sale

Inventory levels can significantly impact market dynamics. In June 2024, the inventory of single-family homes was 2,630, slightly lower than May's 2,660 homes. For condos and townhomes, inventory increased to 1,725 homes from 1,583 in May. Despite the increase in inventory, the median sales price continues to rise, indicating strong demand.

Mortgage Rates

Mortgage rates play a pivotal role in housing affordability. In June, rates fluctuated between 6.99% and 6.86% for a 30-year fixed mortgage. Since early May, when rates peaked at 7.22%, there has been a slight downward trend. While substantial rate cuts are unlikely this year, current rates are still more favorable compared to the sub-3% era, which often came with high appraisal gaps and additional costs.

Tips for Buyers and Sellers

For Buyers :

• Consider that current mortgage rates, while higher, can be more favorable in the long term compared to the high competition and additional costs of previous years. Less competition means fewer appraisal gaps and potentially better deals.

For Sellers :

• Be cautious of the reverse bid strategy, where homes are initially overpriced with the intention of reducing the price over time. This can lead to longer market times and lower final sale prices. Pricing your home accurately from the start will attract more offers and result in a faster, more profitable sale.

Conclusion

San Diego's housing market remains robust with rising prices, quick sales, and stable mortgage rates. Whether you're buying or selling, staying informed and working with knowledgeable professionals can help you navigate this dynamic market successfully. Always refer to reliable sources and verify the data you receive.

Stay in the loop and sign up for our newsletter.