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San Diego Housing Market Update May 29th, 2024

San Diego Leads Nation in Home Price Increases for Fourth Consecutive Month

San Diego has once again seen the fastest rising home prices in the nation, marking the fourth month in a row of significant gains. The city’s home prices have surged nearly double the U.S. average. Nationwide, prices are up across the board, with all metros in the 20-city index experiencing increases.





Mortgage demand falters as interest rates rise for the first time in a month

Mortgage demand slumps as interest rates cross 7% thresholdA key measure of home-purchase applications fell to a three-month low as mortgage rates started to rise again.


"Mortgage rates increased for the first time in four weeks, with the 30-year fixed rate up to 7.05% and all other loan types also seeing increases," said Joel Kan, MBA's vice president and deputy chief economist. "The uptick in rates led to a decline in mortgage applications heading into Memorial Day weekend."

Housing demand cooled as rates moved higher. Applications for a mortgage to purchase a home dropped 1% from the previous week. Application volume is down 10% compared with the same time last year.


Economists predict that mortgage rates will remain elevated for most of 2024 and that they will only begin to fall once the Federal Reserve starts cutting rates. Even then, rates are unlikely to return to the lows seen during the pandemic. 

On top of that, investors are growing skeptical about the odds of a Fed rate hike this year given the string of hotter-than-expected inflation reports at the beginning of the year.


Apartment Rents Post National Monthly Growth of Over 1% in May

The national rent index saw both one and two-bedrooms increase 1.2% this May to medians of $1,504 and $1,865, respectively, marking the first time there has been monthly growth rates of over 1% in 20 months, according to Zumper.


Data shows the current median rent in the San Diego market is just over $2,300. It increased 0.6% in April from the month before. According to Apartment List, the median rent for a one-bedroom in San Diego is $1,970 while a two-bedroom goes for about $2,470.


As the housing market continues to evolve, it's crucial for both buyers and renters to stay informed about the latest trends and economic factors influencing real estate. With San Diego leading the nation in home price increases and the national rental market showing signs of growth, the dynamics of affordability and availability remain at the forefront. Whether navigating rising mortgage rates or adapting to fluctuating rental prices, understanding these shifts will help individuals make better-informed decisions in the current market landscape.


For personalized advice and the latest market insights, contact me today to ensure you’re making the best choices for your future.



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