Introduction

Chad Dannecker: Hi, I’m Chad Dannecker with Dannecker & Associates at Compass, coming to you with your late April San Diego County housing market update.

Interest Rates

First off in the news with interest rates—rates took a pretty good hike at the end of February with the whole conflict in Iran. They took a pretty solid jump within about a two-week period up to 6.625%. They settled back down a little bit to about 6.3% and then took another jump last week with everything going on to 6.5%, and we sit at about 6.4% today.

I talk about interest rates because they really do matter. San Diego County was one of the top five most unaffordable metros in the nation, and so even just small swings—quarter percent, half percent swings—can definitely impact our San Diego market.

Active Listings Inventory

Active listings right now: we’re up 5% in the last two weeks and 2% lower than last year. So, we’re kind of sitting in this same zone as last year, just not as many listings as we thought we would see on the market right now. I think a lot of people are kind of holding off to see if things in the Middle East settle down because they would expect if interest rates get lower, we’ll probably see more activity in the market.

Demand Year-Over-Year

In terms of demand, our demand sits—in the last two weeks we’re up 1%, which is about 17 sales. That means 17 more pending home sales in the last two weeks. And that’s 6% higher than it was last year.

That makes sense if we go back to interest rates; last year we were up in that 7% range at this very moment in time. So the fact that we’re sitting at 6.4% today is a pretty significant difference—more than a half percent. We talk about those interest rates affecting and impacting the market just because of the affordability in San Diego County and how expensive things have become.

Expected Market Time

Expected market time: we went from 80 days two weeks ago to 84 days today. Last year we were at 91 days. So, times are actually shorter; homes are selling faster this year at this time than they were last year because, again, interest rates are lower.

Even though you might be feeling the impact at the pump with the cost of things, dining out, and groceries, interest rates are lower, so buyers are still active in this market—definitely seeing active buyers in the market.

Closed Sales (March Recap)

For closed sales finishing up March (it takes about a two-week lag for all the information to come through from the San Diego Association of Realtors): there were 2,057 home sales in March, which is actually up 11% from last year. That’s a pretty good bump in volume in terms of the number of home sales in the county. We saw that on our team; we actually sold quite a few homes and had a good first quarter.

Market Breakdown by Price Range

Real estate is hyper-local. It depends on location, whether it’s an attached home (condos) versus a detached home, and the price range.

The big jump you really see is in the $4M – $6M range, which dropped from 300 days down to 158 days. That’s almost half the time, which covers a lot of coastal San Diego.

Overall Trends

• The “Sweet Spot”: Detached homes between $1.5M – $2M are the hottest market segment in coastal areas, selling in 57–75 days.
• Luxury Market ($2M+): Slower sales pace requiring “precision pricing.” Homes over $8M face extreme market times (4+ years).
• Attached Homes (Condos): Significantly slower than detached homes due to high HOA dues, rising insurance, and mortgage rates.
  • Issue: Many buildings are only 15–30% funded in their reserves, leading to big special assessments.
  • Issue: New laws requiring balcony inspections are revealing expensive repairs for older wood buildings.
• Affordability Crunch: Entry-level condos under $500k have slowed to a 114-day market time (up from 104 last year).

Conclusion

Chad Dannecker: That’s what I’ve got for you today. Again, my name is Chad Dannecker. If you have any questions about real estate in San Diego, I’m always happy to help. Hope you have a great weekend. Thanks!