House prices and sales for San Diego have increased despite the turmoil seen across the wider economy. The key driving factors for the growth are the increase in demand and the drop in supply.
House Prices Continue to Climb
As hard as it is to believe, house prices in San Diego are indeed on the rise. Property values across the San Diego real estate market rose significantly since the start of the year. Property sales are up as well, due to an increase in demand for properties in the area.
The Future Looks Bright For the San Diego Housing Market
A report from the California Association of Realtors from August 2020 said the median sales price for single-family homes in San Diego increased 6% between June and July of that year. To put that into perspective, 6% growth is much higher than the national average – and it happened all in a single month rather than over a year.
The increase is even more surprising when you consider the current state of the economy and the ongoing health crisis. It seems like the impact on the job market hasn’t affected the real estate market as much as it usually would. This could be because most of the industries affected were in hospitality and services; industries where people often rent homes instead of buying them.
Low Inventory Means Fast Sales
It’s easy to understand the real estate situation in San Diego when you consider the supply and demand in the city. The short story here is that there aren’t enough homes to fit all the people who want to move to San Diego. The lack of supply has always been a big issue in San Diego and across Southern California as a whole.
For example, San Diego County had a 1.9-month inventory of homes for sale in July 2020. This number is far below the national average, never mind below what would be considered a “balanced market.” The San Diego market has always preferred sellers to buyers because there’s never enough supply. Some properties receive dozens of offers almost as soon as they go on the market.
Population Growth Driving Real Estate Growth
To follow on from talking about supply, the real estate market in San Diego is booming because of population growth that is increasing demand. More buyers are looking to buy one of the dwindling numbers of properties available.
The U.S Census Bureau says that the population of San Diego grew by over 9% between 2010 and 2019. Growth has been particularly strong across the Metropolitan area, including Chula Vista and Carlsbad. Whether it’s for the beaches or the temperate weather, more people are moving to – and living in – San Diego.
The bottom line to all of this is that the San Diego real estate market is looking good and only continues to get better, especially considering everything happening in the world right now. The main factor here is supply and demand, which should sustain high property prices no matter the political, economical, or health situation of California and the United States as a whole.