SAN DIEGO — Housing prices dropped for a fourth consecutive month in San Diego, but fewer buyers are on the hunt.
The housing market has drastically changed through the pandemic, but this time experts believe the increase in mortgage rates is causing a unique shift that hasn’t been seen since before the pandemic.
For a fourth consecutive month, housing prices dropped in San Diego, but some buyers are getting priced out of the market due to the rising and higher mortgage rates.
“We’re seeing sellers sitting on the market longer, we’re seeing more price reductions because buyers are a little more hesitant, but the other thing that’s happening that we are starting to see, that we haven’t seen in many years, we are also seeing sellers paying closing costs for buyers,” “The No Bull Agent” Ken Kaplan said.
Kaplan says buyers right now “have a little bit of an upper hand because of the standing inventory.”
According to Redfin, the median home price in San Diego is $842,250, showing a slight cool down since the markets height in March.
Redfin said a home in San Diego is staying on the market for an average of 28 days, a number we hasn’t been seen since prior to COVID.
Standing housing inventory in San Diego has tripled in the last year, according to Kaplan. Last year, there were about 1,400 units on the market, and now it’s hovering around 4,500.
“You can make a good deal in a bad market, you can make a good deal in a bad market, the best deal is to make sure it’s good on both sides,” Kaplan said.
What a buyer could qualify for months ago, has changed due to higher interest rates.
For example, using as estimate and good credit, if you purchase a home at the median home price of $842,250 with a 20% down payment with recent interest rates around 6.43%, your monthly payment before taxes and fees is $5,285.
With the same numbers, given a smaller interest rate at 3.22%, which we saw in January 2022, your payment would have been: $3,652 before taxes and fees.