For subscribers: San Diego home price hits another record high. Will it ever stop? (2024)

San Diego County’s median home price growth showed no signs of abating in April as another record was hit.

The median price was $880,000, up from a revised record high of $860,000 the previous month, CoreLogic data revealed Thursday. The county’s median, which includes newly built homes, resale homes and condos, is now up 9.3 percent in a year.

Home prices were up across Southern California, with experts pointing to limited homes for sale as a key factor pushing up prices. There were 2,667 sales in San Diego County in April, an increase from previous months, but still the fourth-lowest volume for an April in records going back to 1988.

“If you want to know what the problem with housing in San Diego is, it’s there’s not enough stuff to buy,” said Chris Thornberg, economist and founder of L.A.-based Beacon Economics. “It’s very simple.”

Thornberg said San Diego County had done a good job building apartments, which has meant stagnating rent prices on average. Yet he said for-sale homes are practically nonexistent because of low building numbers and owners unlikely to sell because of locked-in low mortgage rates — unless they plan to move out of state.

“Do we see any relief (in rising prices)?” he said. “No, I’m afraid you don’t. I don’t expect prices will go up like they did 20 years ago — 20 percent year over year — but prices are certainly not going to be dropping with the tightness of inventory. It’s as simple as that.”

The new record median — the point at which half the homes sold for more and half for less — was reached despite mortgage rates hitting their highest point of the year in April.

In the last week of April, the average interest rate for a 30-year, fixed-rate mortgage was 7.51 percent, said Mortgage News Daily. It was down to 7.29 percent by Thursday morning.

Those higher rates translate into a monthly payment of around $5,350 for a median-priced home, assuming a 20 percent down payment. A year ago — when the median price was $805,000 and the average mortgage rate was 6.59 percent — the monthly payment was roughly $4,530.

Raylene Brundage, a real estate agent who sells in several North County communities, said she recently had a couple drop out of a deal to buy a $2.5 million home in Solana Beach because of rising rates. However, she said she doesn’t hear as much talk of interest rates with lower-priced homes. But she is seeing still other issues with sales. Brundage said she recently had other potential buyers fail to qualify for a mortgage because of poor credit scores.

An ongoing issue for the real estate market is homeowners who have low interest rates locked in and do not want to sell. If they do opt to sell, it means a higher interest rate in a new home and intense competition for a limited number of properties on the market.

Most homeowners have interest rates lower than current thresholds. According to a Redfin study that used mid-2022 data from the Federal Housing Finance Agency, 88.5 percent of U.S. homeowners had an interest rate under 6 percent. More specifically, it said 22.6 percent of owners had a rate below 3 percent; 59.4 percent below 4 percent; and 78.7 percent below 5 percent.

Jeff Grant, an owner and agent with San Diego-based Sand & Sea Investments, said he has spoken to several sellers who are empty-nesters and considered downsizing to get a smaller home closer to the coast. The problem, he said, is they tend to be the least aggressive of current shoppers.

“They tend to be the buyers that are way under-shopping their budget and affordability,” Grant said. “They do not need to sell in order to buy, so they have flexibility and it’s hard to get them off the sidelines.”

Here’s how different home types in San Diego County fared in April:

• Resale single-family: Median of $985,000 with 1,592 sales. It is a new high, up from the previous peak of $965,000 in March.
• Resale condo: Median of $720,000 with 804 sales, which was a new price peak. The previous was $690,000 in March.
• Newly built: Median of $837,500 with 109 sales. This figure combines single-family homes, townhouses and condos. It was down from a peak of $1.2 million in July, when there was an influx of newly built single-family homes, lifting the median higher.

One positive for home shoppers is a slight increase in inventory. There were 3,923 homes listed for sale in April, reported the Redfin Data Center, down from a low of 3,080 in mid-January.

All markets in Southern California saw price increases in April. Here’s a look at the median prices across the region:

• Los Angeles County: Up 3 percent in a month for a median of $865,000; up 8.1 percent in a year.
  
• Orange County: Monthly rise of 4.3 percent to a median of $1.2 million; annual increase of 21.7 percent.
  
• Riverside County: Monthly rise of 1.7 percent to a median of $585,000; up 7.3 percent annually.
  
• San Bernardino County: Up 0.4 percent in a month for a median of $489,000; annual increase of 8.2 percent.
  
• San Diego County: Up 2.3 percent in a month to a median of $880,000; up 9.3 percent in a year.
  
• Ventura County: Monthly rise of 1.2 percent for a median of $835,000; rise of 8.4 percent annually.