San Diego Real Estate Market Update – February 2023
Download full reports:
Monthly Indicators
The US housing market began the year in a state of rebalance, with many buyers and sellers remaining cautious while they wait to see where the market is headed. Nationally, pending sales rose 2.5% month-to-month, marking the first increase since May, while sales of existing homes fell 1.5% as of last measure, according to the National Association of Realtors® (NAR). Demand for housing persists, but higher mortgage interest rates have cut into housing affordability, with total home sales down 17.8% last year compared to 2021.
Closed Sales decreased 36.9 percent for Detached homes and 40.5 percent for Attached homes. Pending Sales decreased 21.7 percent for Detached homes and 31.1 percent for Attached homes. Inventory increased 14.3 percent for Detached homes and 36.2 percent for Attached homes.
The Median Sales Price was down 3.5 percent to $849,000 for Detached homes but increased 0.9 percent to $590,000 for Attached homes. Days on Market increased 79.2 percent for Detached homes and 110.5 percent for Attached homes. Supply increased 57.1 percent for Detached homes and 120.0 percent for Attached homes.
As sales slow, time on market is increasing, with the average home spending 26 days on market as of last measure, according to NAR. Seller concessions have made a comeback, giving buyers more time and negotiating power when shopping for a home. Although home prices remain high, mortgage rates declined steadily throughout January, falling to their lowest level since September, sparking a recent surge in mortgage demand. Lower rates should aid in affordability and may soon lead to an uptick in market activity ahead of the spring selling season.
Housing Supply
For the first time in a year, homebuilder confidence has increased, rising 4 points to 35 in January, according to the National Association of Home Builders (NAHB) / Wells Fargo Housing Market Index (HMI). Elevated sales prices, coupled with a surge in mortgage rates, caused demand for new homes to plummet in 2022, with builder sentiment declining throughout the year. The recent rise in builder optimism may be due in part to new home sales, which increased 2.3% month-to-month as of last measure, according to the U.S. Census Bureau. For the 12-month period spanning February 2022 through January 2023, Pending Sales in the San Diego were down 29.7 percent overall. The price range with the smallest decline in sales was the $1,000,001 to $1,250,000 range, where they decreased 4.5%.
The overall Median Sales Price was up 9.5 percent to $820,000. The property type with the largest price gain was the Condos – Townhomes segment, where prices increased 13.8 percent to $626,000. The price range that tended to sell the quickest was the $1,000,001 to $1,250,000 range at 23 days; the price range that tended to sell the slowest was the $5,000,001 and Above range at 64 days.
Market-wide, inventory levels were up 20.9 percent. The property type with the largest gain was the Condos – Townhomes segment, where they increased 36.2 percent. That amounts to 1.1 months supply for Single-Family homes and 1.1 months supply for Condos.
Categories
