‘Sellers’ market is cooling’: San Diego home price falls for first time this year

San Diego County’s median home price fell for the first time this year in August.

The median home price fell to $889,500, down 1.2% from the previous month, according to Attom Data Solutions, which combines sales of single-family homes, townhouses and condos. Despite sluggish sales and affordability issues, San Diego’s home prices have been unchanged, or rising, throughout much of the year.

Home sales remained at historic lows in August but did pick up slightly. There were 2,439 sales, up 2.4% from the same time last year. It was still the second-lowest sales for an August, typically a busier month, in records from Attom and Cotality going back to 1988.

“The sellers’ market is cooling. The needle is moving a bit,” said Mark Goldman, a loan officer and real estate analyst with C2 Financial Corp.

He wouldn’t go so far to say it was a buyer’s market, where supply greatly exceeds demand. Yet he pointed to the time it is taking to sell homes and lack of interest in open houses as signs sellers may be losing the edge.

The median time for a San Diego County home to sell hit 40.5 days in August, according to the Redfin Data Center, its highest point in more than four years. In early 2022, homes stayed on the market eight to 12 days.

Buyers now also have more homes to choose from than typical in the tight local market. There were about 7,000 homes for sale in San Diego County in August. That compares to 5,700 around the same time last year, 3,600 in 2023 and 5,800 in 2022.

Single-family homes in San Diego County fell out of the $1 million club with Orange County in August. The median sale price for a single-family home fell to $997,250, down 1.3% from the previous month. The median for a condo or townhouse, $693,750, was up 6.7% in a month.

A recent drop in mortgage rates has been celebrated by real estate agents in the hope it could spur sales, although it also has its skeptics. The National Association of Realtors put out an article last week suggesting “homebuyers reexamine the market with lower rates.” It cited a LendingTree analysis that said recent rate drops over the past year could save potential buyers around $40,000 over the life of a 30-year loan.

Mortgage rates have dipped since the last week in August when the average for a 30-year, fixed-rate mortgage was 6.56%, according to Freddie Mac. The average rate was 6.3% at the end of last week.

The monthly payment for a median priced home in San Diego County in August for a 30-year mortgage, using interest rates at the time, would be around $4,900. That assumes a 20% downpayment of $177,900.

Some economists have pointed to affordability challenges being more of an issue for the home market than just interest rates. Namely, that home prices have gone up so much since the pandemic, without corresponding wage increases.

Here’s a look at median prices in August across the region:

Los Angeles County: Down 1.8% in a month for a median of $893,500; up 1.5% annually.

Orange County: Monthly drop of 2.2% to a median $1.15 million; flat year-over-year.

Riverside County: Down 0.7% monthly for a median of $595,000; down 0.8% annually.

San Bernardino County: Unchanged monthly with a median of $520,000; down 1% in a year.

San Diego County: Monthly drop of 1.2% to a median of $889,500; up 1.7% annually.

Ventura County: Monthly drop of 2.5% for a median of $829,000; down 3.9% annually.