San Diego is regularly cropping up on lists outlining the best places to live in the United States. People are drawn to San Diego because of the quality of life in the city, the job market, and so much more.
However, one of the things that can be difficult about moving to San Diego is how competitive the current real estate market is. The San Diego real estate market is hot, hot, hot, meaning that buyers really have to compete to get the homes they want.
Are you wondering what you should know about the San Diego real estate market?
Let's take a look at fifteen important facts and figures to help you understand San Diego County real estate.
1. The Median List Price Is Rising
According to Redfin, the median price for homes in San Diego is $769,000 as of September 2021. This means that the prices were up 9.8% when compared to next year. Houses are also spending several fewer days on the market than they were last year, and the number of homes in San Diego decreased in September 2021 when compared to the previous year.
2021 has been a difficult year for first-time homebuyers who were trying to buy in San Diego County. With not a lot of inventory and a lot of demand, people who were working to purchase their first home struggled to make offers as competitive as others in the market. According to a new article from KPBS, many of the people outbidding first-time homebuyers in the spring of 2021 were people that weren't from San Diego or investors that had very deep pockets.
2. The Population of San Diego Is Growing
In the last ten years, the population of San Diego has grown by about 80,000 people. This means that the growth amounts to a 6% increase.
One of the growing demographics in the San Diego area is the Asian population. Their population has increased by double digits in the last ten years. There are 410,000 Asian people living in San Diego as of 2020, making up 12.5 percent of the county's population.
There are a lot of different reasons why people are moving to San Diego. Many of the people who have been relocating to this beautiful city are Millennials.
One study from 2020 found that about one-third of the population of San Diego was made up of Millennials. This means that in San Diego County there are more than one million Millennials. Second only to Austin, Texas, this makes San Diego the city with the largest share of Millennial residents.
People are drawn to San Diego for countless reasons, including the employment opportunities, the year-round great weather, and the abundance of amenities.
As an example of the job market in San Diego, there were 160,000 jobs added in the city between 2010 and 2017. The unemployment rate in the city was lower than it had been in a decade at the end of 2019.
3. Rent Prices Are Rising in San Diego
If you're a renter in San Diego, you've likely noticed the rising rent prices for at least the last several years. In four of the largest nationwide markets, which includes San Diego, tenants pay more than forty percent of their income towards the cost of housing.
According to ABC10 News in San Diego, rent prices are predicted to increase 9.1% in 2022. A California Law in 2019 capped rent hikes at five percent plus inflation. In a normal year, inflation is usually around 2%, but inflation has been at record highs due to the coronavirus pandemic.
This means that many landlords could increase their rents by 9.1% for leases that began on or after August First of 2021. The law was initially passed as a way of ensuring that landlords can't raise rents beyond a certain amount.
For many renters, dealing with rising rent prices might seem unmanageable, leaving them to consider buying. If you're trying to find a San Diego home with the most value for your money, you'll want to take a look at this article.
4. San Diego Real Estate: A Seller's Market
The coronavirus pandemic initiated a number of phenomena that turned many markets in the U.S. into seller's markets. San Diego has been no exception. At this time, there is a lot more interest from buyers in purchasing houses than there are sellers who are willing to let go of their San Diego real estate market. Because of this demand, prices are rising and the market is extremely competitive.
Are you planning on buying a home in San Diego? Check out our house shopping guide here.
5. New Construction Homes Are Required to Be Green
New building code regulations have been passed in the state of California. These laws mandate that all new homes function based on renewable energy. The term used here is 'net zero ready,' meaning that homes need to be equipped to generate as much if not more of the energy that they use.
It is also mandated that every new single-family home has roof solar panels. This means that buyers who are purchasing new construction houses can benefit from the lower utility costs and maintenance costs of this technology.
6. San Diego Ranks Highly in a Number of U.S. News Metro Area Lists
San Diego ranks third after San Francisco and San Jose as the best place to live in California, according to U.S. News & World Report.
San Diego also received high marks for its quality of life. It was ranked number 11 for quality of life out of the entire country.
7. Sales Prices Are On the Rise For Homes
According to Redfin, the home prices in San Diego were up 9.8% in September 2021 compared to last year. The website Porch, a home improvement site, predicts that the median home price of San Diego homes will nearly reach $1 million by August 2022.
This study forecasts that San Diego's home prices will increase nearly 25% in a year. Single-family homes are in high demand in San Diego, meaning that sellers can sell them at a premium.
8. Redfin Scores San Diego As a 'Very Competitive' Market
The real estate site Redfin has a scale from 0 to 100 to help understand how competitive a real estate market is. San Diego scores very high on this scale, with an 82 out of 100.
There are a number of factors that go into determining an area's score. In San Diego, many homes on the market receive multiple offers that sellers get to choose from. Some of these even have waived contingencies, which buyers will sometimes do to make their offer more competitive.
The average homes in San Diego go pending in about eleven days and they sell for 2% above list price. For homes that are considered 'hot homes,' these figures can be even more staggering. For these most popular homes in the best neighborhoods, they can go pending in about six days and sell for 6% above the list price.
Are you wondering where the best neighborhoods in San Diego are? If so, check out this article.
9. San Diego Is Considered an Extremely "Pleasant" Place
A software engineer named Kelly Norton felt compelled to determine which U.S. cities had the most frequently pleasant weather. Norton then designed a map to help visualize this information. He found that San Diego had the second-highest number of pleasant days a year, falling just one day short of the number of pleasant days in Los Angeles.
10. San Diego Is One of the Least Expensive Cities in California
To be clear, San Diego is not a particularly cheap place to live on the national scale. However, when it comes to comparing it to other cities in California, it's still more affordable. If you're looking to live in one of the most sought-after cities in California but you can't afford San Francisco, San Jose, Santa Cruz, or Napa, you might find that San Diego fits better within your price range.
When you're talking about cost of living, everything is relative. The rent prices in San Diego are affordable when you compare them to other coastal cities. That doesn't mean that if you're moving from rural Kansas you won't be shocked by the high rental rates in this California city.
Many residents also consider the higher cost of living simply the cost of living in such a nice area. There are so many great amenities in the area and the weather really can't be beaten. Most days are warm and sunny and it's a great place for people who want to live an active lifestyle.
Are you wondering what the cost of living is in San Diego? If so, take a look at this salary guide.
11. The Average Homes Go Pending in Eleven Days
When you put a home on the market in San Diego, chances are you won't have to wait very long before the offers start rolling in. The average amount of time it takes for a house to go pending after it is listed in this city is less than two weeks.
12. Homes Sell For About 2% Above List Price On Average
If you're selling your house in San Diego, you also have the added benefit that people will likely offer more than you listed the home price. This isn't a bad position to find yourself in when you're on the seller side of the equation!
13. Hot Homes Typically Go Pending in About Six Days
If you're in the market for one of the hottest homes in one of the hottest neighborhoods, you're going to need to act quickly. These houses typically go pending in about six days. While this is great for sellers, it can create a whirlwind experience for buyers.
14. The San Diego Real Estate Market Is Only Slightly Less Competitive Than Oceanside and Carlsbad
The nearby cities of Oceanside and Carlsbad both got slightly higher scores on Redfin's Compete Score.
The city of Oceanside received an 86 out of 100. In this area, it is common for homes to receive multiple offers and sometimes for contingencies to be waived. The average home goes pending in about 10 days and sells for 3% above the list price.
Hot homes in Oceanside have similar stats to San Diego. They typically go pending in about six days and sell for 6% above list price.
Carlsbad receives an 83 out of 100 on Redfin's score weighing out the competitiveness of markets. This market also sees homes receive multiple offers, some of which have the contingencies waived.
The average home in this market goes pending in about eleven days and sells for 3% above the list price. Hot homes, sell for 7% above their list price on average and go pending in six days.
15. The Average San Diego Home Receives Six Offers
If you're selling your house in San Diego, the average number of offers you can expect to receive is six. That's a pretty good deal for the seller, but it means that buyers have to work hard to create the most competitive offer right from the get go if they really want to snag a house.
Are You Searching For Real Estate Agents in San Diego?
Navigating the world of San Diego real estate can feel overwhelming and impossible. However, when you have experienced and knowledgable real estate agents on your team, you can rest assured that you'll be able to find the home you're looking for at a price you're happy with.
At Steele San Diego Homes, we always put you first. Whether you are buying or selling a home, we are here to give you the right advice for your particular situation.
Is it time for you to find the best real estate agents in San Diego? If so, contact us today!