San Diego Real Estate Market Update – April 2022
Coming into this year, most experts projected mortgage rates would gradually increase and end 2022 in the high three-percent range. It’s only April, and rates have already blown past those numbers. Freddie Mac announced last week that the 30-year fixed-rate mortgage is already at 4.72%. READ MORE>>
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Monthly Indicators
Nationally, existing home sales recently dropped to a 6-month low, falling 7.2% as buyers struggled to find a home amid rising prices and historic low inventory. Pending sales are also down, declining 4.1% as of last measure, according to the National Association of REALTORS®. Builders are working hard to ramp up production—the U.S. Census Bureau reports housing starts are up 22.3% compared to a year ago—but higher construction costs and increasing sales prices continue to hamper new home sales, despite high demand for additional supply.
Closed Sales decreased 6.2 percent for Detached homes and 16.9 percent for Attached homes. Pending Sales decreased 6.1 percent for Detached homes and 13.7 percent for Attached homes. Inventory decreased 36.4 percent for Detached homes and 48.8 percent for Attached homes.
The Median Sales Price was up 20.4 percent to $975,000 for Detached homes and 25.4 percent to $646,065 for Attached homes. Days on Market decreased 5.0 percent for Detached homes and 33.3 percent for Attached homes. Supply decreased 33.3 percent for Detached homes and 50.0 percent for Attached homes.
Across the country, consumers are feeling the bite of inflation and surging mortgage interest rates, which recently hit 4.6% in March, according to Freddie Mac, rising 1.4 percent since January and the highest rate in more than 3 years. Monthly payments have increased significantly compared to this time last year, and as housing affordability declines, an increasing number of would-be homebuyers are turning to the rental market, only to face similar challenges as rental prices skyrocket and vacancy rates remain at near-record low.
Housing Supply
Millennials are entering the housing market at a record pace, fueling demand and driving sales prices higher amid an epic housing shortage. Currently, millennials represent 22% of the U.S. population but make up 43% of the current market share, according to a survey by the National Association of REALTORS®. With nearly a quarter of the population approaching their peak earning years over the next two decades, this new generation of homebuyers are expected to have a big impact on the economy—and on the housing market—in the years to come. For the 12-month period spanning April 2021 through March 2022, Pending Sales in the San Diego were down 1.3 percent overall. The price range with the largest gain in sales was the $5,000,001 and Above range, where they increased 88.4 percent.
The overall Median Sales Price was up 17.7 percent to $765,000. The property type with the largest price gain was the Condos – Townhomes segment, where prices increased 20.0 percent to $570,000. The price range that tended to sell the quickest was the $750,001 to $1,000,000 range at 18 days; the price range that tended to sell the slowest was the $5,000,001 and Above range at 78 days.
Market-wide, inventory levels were down 41.3 percent. The property type with the smallest decline was the Single-Family Homes segment, where they decreased 37.0 percent. That amounts to 0.6 months supply for Single-Family homes and 0.5 months supply for Condos.
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