San Diego Real Estate Market Update – April 2023
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Monthly Indicators
Nationally, existing home sales jumped 14.5% month-over-month as of last measure, the first monthly gain in 12 months, and representing the largest monthly increase since July 2020, according to the National Association of REALTORS® (NAR). The sudden uptick in sales activity stems from contracts signed toward the beginning of the year, when mortgage rates dipped to the low 6% range, causing a surge in homebuyer activity. Pending sales have continued to improve heading into spring, increasing for the third consecutive month, according to NAR.
Closed Sales decreased 32.6 percent for Detached homes and 32.2 percent for Attached homes. Pending Sales decreased 36.8 percent for Detached homes and 29.9 percent for Attached homes. Inventory decreased 11.9 percent for Detached homes and 4.2 percent for Attached homes.
The Median Sales Price was down 3.5 percent to $940,500 for Detached homes and 1.6 percent to $635,000 for Attached homes. Days on Market increased 90.0 percent for Detached homes and 100.0 percent for Attached homes. Supply increased 37.5 percent for Detached homes and 42.9 percent for Attached homes.
Monthly sales might have been even higher if not for limited inventory nationwide. At the current sales pace, there were just 2.6 months’ supply of existing homes at the beginning of March, far below the 4 – 6 months’ supply of a balanced market. Inventory remains suppressed in part because of mortgage interest rates, which nearly hit 7% before falling again in recent weeks. Higher rates have continued to put downward pressure on sales prices, and for the first time in more than a decade, national home prices were lower year-over-year, according to NAR, breaking a 131-month streak of annual price increases.
Housing Supply
According to the U.S. Census Bureau, national sales of new homes edged up 1.1% month-over-month as of last measure, thanks in part to builders’ use of incentives and price discounts, with increases in housing starts and permits reported as well. Builder sentiment also continues to rise, as a limited supply of existing-home inventory has led to an uptick in new-home demand. According to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), builder confidence increased for the third consecutive month in March, rising two points to 44 from the previous month, marking a six-month high. For the 12-month period spanning April 2022 through March 2023, Pending Sales in the San Diego were down 33.8 percent overall. The price range with the smallest decline in sales was the $1,000,001 to $1,250,000 range, where they decreased 15.1 percent.
The overall Median Sales Price was up 7.2 percent to $820,000. The property type with the largest price gain was the Condos – Townhomes segment, where prices increased 9.6 percent to $625,000. The price range that tended to sell the quickest was the $1,000,001 to $1,250,000 range at 26 days; the price range that tended to sell the slowest was the $5,000,001 and Above range at 66 days.
Market-wide, inventory levels were down 9.5 percent. The property type with the smallest decline was the Condos – Townhomes segment, where they decreased 4.2 percent. That amounts to 1.1 months supply for Single-Family homes and 1.0 months supply for Condos.
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