Is San Diego now in a Buyers Market?

Have we finally hit a Buyer’s Market here in San Diego?

Looking at the week over week data versus the month and the year data, things are starting to take a turn. We’ve been seeing this coming for a bit – median prices aren’t reflective of that though. They’re very, very high as I just reported on a couple of weeks ago. Median prices hit $1 million here in San Diego and I expect that number to probably rise this month as well. That information has not come out yet. However, some of the big key data points that we’re taking a look at are how many listings there are and the pending sales that are falling right now. It looks like we are transitioning into a Buyer’s Market in the housing market here in San Diego, or at least a more balanced market.

Pending sales continue to fall week over week as reflective likely of escrows falling out of contract for the most part. And new listings on the market or overall listings on the market actually has continued to rise. Just a couple months ago, we were at 1,900 homes. We’re now at 3,200 homes and seemingly to continuing to climb. That’s up 70% in two months. That’s a significant rise in inventory. Most people want to see six months of inventory before that’s considered a quote balanced market, and then therefore, essentially a buyer’s market at that point. However, with this rapid rise and inventory falling number of pending sales occurring, things are shifting back in favor of buyers quite rapidly.

Now it is certainly neighborhood-to-neighborhood,  market-to-market, and home-to-home. What exactly is occurring? There’s still bidding wars occurring, but there’s also a lot of price reductions occurring as well, or homes going just for list price and sitting on the market for a little bit longer.

It’s hard to say that in the overall market, every single home is now experiencing a buyer’s market and there’s going to be price reductions. ,That’s just not the case. I was just involved in a bid where it went nearly $300,000 over list price. And then there was a home that sold nearby that was a price reduction.

It depends on the specific home, what that home is offering. What is around that home? Are there things you can not change about that home? Is it on a busy road? Is it overlooking a freeway or their power lines running right next to it? Where the home is super, super desirable, totally turnkey, And it’s ready to go the people are willing to pay more for that right now. But if there’s inherent issues with the home, people are not willing to pay for that sitting on the market. 

And there are price reductions occurring. That’s going to start to ripple through to other homes as well. And I think the market is starting to stabilize and buyers are going to start having a lot more selection. We already are at 3,200 homes. You’re going to be able to start selecting the home that you want instead of just sort of taking the home that you’re given and have to get and have to spend a lot more on.

We are really starting to shift back into a buyer’s market. If you are listing a home, we need to be very conscientious about the other homes on the market. What is the competition that your home is facing? How is this home being positioned and priced to drive the most amount of eyeballs and traffic into the property and avoid price reductions and actually sell the home quickly and out of the gate. 

You also need to be prepared that buyers are going to be more selective and more picky. I’m working with quite a few buyers right now who are very particular for good reason because they know that they can be picky right now and start to select the home that they really want. They are not just going after the first home comes on the market, like what has been essentially happening over the last couple of years.

Curtis Chism, Realtor
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