What do the July stats tell us? In short, the market is stabilizing. And that is going to take some getting used to.
We are coming off a 2 year period of unprecedented activity with record high buyer demand against record low inventory that created a panicked, auction-type environment. It's been a long time since we've seen a stable market where both sides have leverage and it takes more than 24 hours to sell a home.
July saw a slight dip in month over month median home values, coming in at $835K for all properties in San Diego County. This still represents a +11% increase over the year prior, with the condo market actually outpacing the detached single home market with a +14% year over year appreciation and a slight uptick in value from the month prior.
The rapid rise in mortgage rates has slowed the market down and helped build up inventory, with nearly 5000 homes on the market. However, as rates have eased closer to 5% (down from just over 6% in June) and with fewer homeowners listing their homes (-30%), the inventory still sits about -25% to -30% BELOW pre-pandemic levels, meaning there is still not enough inventory out there relative to demand.
As long as rates remain at this level between 5% and 5.5%, we can expect a little bit more build up in inventory through the end of summer into September, but it will quickly diminish as we go into the holiday season. This will keep the market in a "slight seller's market", similar to where we were pre-pandemic, and should keep home appreciation stable with steady growth.
*all data sourced from San Diego Association of Realtors® & from ReportsOnHousing.com