Introduction

Chad Dannecker: Hi, I'm Chad Dannecker with Dannecker & Associates at Compass coming to you with your Mid-July San Diego County housing market update.

Interest Rates

So in mortgage rates right now, we're sitting at about 6.71%. All of this turmoil with Iran still wreaking havoc with our interest rates—both the Fed rates and with our 30-year mortgage.

So at 6.71%, we're getting close to that 7% marker where it really creates a lot of drag on the local housing market. When you pair our high cost of living here with these higher mortgage rates, we really just find that it bogs a lot of buyers down.

San Diego County Median Home Prices

Right here, if you look at San Diego County median home prices, you can see where we're really at the highest level we've been since June 27th of 2024. So we're kind of right back into that 2024 range.

And this is for the median home price, and this is both single-family and attached homes, so this is kind of bundling homes and condos in. But keep in mind, single-family home values are up while in many cases condo values are down. Condo values have been pushed down due to HOA dues going up, due to poor reserves, due to situations like the balconies where a lot of the older buildings are having to get balconies rebuilt. So again, that's creating some drag on the condo market right now.

Zillow Research Home Price Index

I think pretty interesting, this is Zillow research for the Home Price Index. It's kind of interesting because you can see here that back in June of 2022 and March of 2023, you can see this 7% drop.

At that same time, the number of pending home sales took a dip of 45% as well. Then you can see in 2023, the values went up about 6.9%, even with that January through March being negative of that year. They still went up 6.9%, which just shows you the resilience of the San Diego County housing market.

Then in 2024 up 4%, and then in 2025 you kind of look at this and appreciation really stalled, right? It sat at about 0.78% for 2025, which is kind of interesting.

If you jump here, you can see 2025 values actually went down and then they ended the year up, and that's where we got that 0.78%. And then of course 2026, we had interest rates at the beginning of this year at 5.99%, and you saw values were up, and now values are kind of cooling back down. So right now, we're almost sitting at a net-zero gain for the year for 2026, so kind of interesting.

Home Prices vs. Inflation

When you think about that, right, home prices are up, yes, but if inflation's up at 3% and home prices only went up just under 1%, your net effect is really not a gain on your family wealth with your housing. When you start looking at all the real estate you might own, the values of your real estate didn't really go up because inflation outpaced the home value increase. So kind of interesting on that front.

Active Listings Inventory & Demand Year-Over-Year

One thing that's interesting, too, is there's actually 8% less listings on the market this year than the same time last year. Our demand is down, but our number of listings are also down, so those are falling hand in hand. Demand's down 5%, number of listings down 8%.

It's really kind of created what I would call a balanced market. Neither the seller nor a buyer really has the upper hand right now across the county. There's certain situations, certain locations, certain homes that are going to be high demand just because they're prime location, prime views, or in excellent condition.

Sitting where they are with interest rates being higher for longer, we don't really see prices changing all that much for the rest of the year. All of the economists keep saying "higher for longer" is really the theme moving forward.

Expected Market Time

And then of course, our expected market time went from 90 days to 93 days. So things typically slow a little bit in the summer, so that's not something that we wouldn't expect to happen. This is completely in line with what expectations would be.

Conclusion

Again, my name is Chad Dannecker. If you have any questions about real estate in San Diego, always happy to help.

Remember, real estate is hyper-local. So what's happening out in La Mesa might be totally different than what's happening in Point Loma or La Jolla. So if you're in doubt or if you have any questions, always just give us a call. Happy to help. Thanks so much!