Despite tight inventory, rising interest rates, and longer average market times, San Diego’s real estate market ended 2023 on a high note. The median price for a single-family home in November 2023 soared to $980,000, while the median price for a condo or townhome reached $667,500. All sectors of the housing market in America’s Finest City closed out the year posting modest price gains, a sign of resilience and vitality that should continue into 2024.
At the close of each year, I do a thorough market review to analyze trends in San Diego housing data. Pairing this with nationwide forecasts from some of the top economic and finance experts in America, I’m able to create a robust, data-supported picture of the next twelve months for our local market. If you’re wondering what to expect in the New Year, here are some of my expert predictions for the 2024 San Diego housing market.
San Diego Homes Prices Will Continue to Rise
Realtor.com recently added San Diego to their list of the Top Ten Real Estate Markets of 2024, citing expected home price growth and the projected strength of sales. According to their forecast, San Diego home prices could grow by another 5.4% in 2024 with overall sales increasing 11% year-over-year.
Nationwide, home prices are predicted to increase through 2027. The average household is expected to gain more than $70,000 in wealth based solely on increased home equity during that period. San Diego homeowners will likely see even higher earnings for both household wealth and equity. If you’ve been thinking of purchasing a new home, plan to act early in 2024 to take advantage of both overall lower home prices and maximum equity growth potential.
Inventory of Available Homes Could Increase
Experts remain divided on whether inventory will increase in 2024, but most people agree that any growth in home sales will remain relatively stagnant. Nationwide, home sales are expected to grow only modestly from 4.8 million in 2023 to 5.2 million in 2024. Affordability challenges and higher interest rates are keeping some would-be sellers in their homes, hoping for a market shift before they make their move.
Interest Rates Are Predicted to Fall, But Buy-Down Strategies Remain Available
Business Insider had one of the leading headlines of the last week, predicting that the Federal Reserve will cut interest rates up to six times in 2024 alone. Time will tell if that’s wishful thinking, but most experts agree that the Fed will cut the standard interest rate in the New Year. This will likely drive mortgage rates down below 7% and perhaps even as low as 6% by year’s end! 2023 saw interest rates touch 8%, so this would be a welcome relief to prospective home buyers.
Higher interest rates aren’t a reason to sit on the sidelines of the housing market. If you are serious about buying a home in San Diego, rate buydowns are a little-known strategy that most people aren’t aware exists. I’ve helped many of my clients obtain a fantastic, lower rate and save money on their home purchases. Reach out to me to learn more about this and the other proven tactics I have that will help you successfully sell and buy in San Diego next year.
As one of San Diego’s premier luxury real estate experts with over $300 Million in career sales, I would be honored to work with you in 2024. Request a personalized assessment of your home’s current value here or browse the latest listings in San Diego to take the next steps now.