San Diego’s housing market is experiencing significant shifts following the Federal Reserve’s recent decision to cut the standard interest rate by 50 basis points at their September meeting. This move, aimed at cooling inflation while fostering economic growth has immediate and long-term effects for both buyers and sellers in America’s Finest City. For sellers, the lower rates may boost demand as buyers take advantage of more affordable loan options. Meanwhile, prospective buyers have a unique opportunity to potentially lock in better mortgage interest rates.
The Fed Cut Rates—What’s Next for 2024?
While the Fed’s decision to cut the prime rate fifty basis points this fall was notable, it’s not the only move they’ll potentially make before the end of the year. The most recent US jobs report came in stronger than expected, though most economic and real estate experts still predict the Fed will cut the prime rate at least once more before we ring in the new year.
Prospective San Diego home buyers and sellers should understand that the standard interest rate, or prime rate, does not directly control mortgage rates. Instead, it serves as a benchmark for various interest rates, including mortgages, credit cards, and other consumer loans. A lower rate tends to make borrowing cheaper, which can stimulate consumer spending and investment, while a higher rate makes borrowing more expensive, helping to control inflation.
Inside the Fall 2024 San Diego Housing Market Data
According to the most recent data from the San Diego Association of Realtors (SDAR), the San Diego housing market responded to the Fed rate cut with an increase in both home sale prices and the number of properties sold. For a detached home, the median sale price in San Diego County was $1,050,000 for September 2024. Additional key data points to watch include the number of closed sales countywide, which increased 8.4% year-over-year, and the inventory of homes for sale, which jumped 37%! Looking at sales of condos and townhomes, the median sales price for an attached property is $675,000. Meanwhile, the inventory of these properties has grown 71% year-over-year.
Planning to Buy or Sell in San Diego in 2025? What You Need to Know
With less than ninety days left in the year and a presidential election around the corner, many San Diegans are looking ahead to 2025 and planning their next moves. Whether you own a property that no longer serves your lifestyle, are looking to invest, or want to buy your first home here, 2025 is shaping up to be a year full of opportunity for both buyers and sellers in San Diego.
Home prices aren’t expected to drop anytime soon. Early economic reports for next year predict that property values nationwide will grow by about 3-4%. Home prices will likely trend even higher here due to the desirability of real estate in a thriving city like San Diego. However, buyers shouldn’t despair. Rising inventory and a predicted drop in mortgage interest rates will offer increased opportunities to find and purchase your dream home.
Navigating the San Diego housing market successfully requires local insight and strategic preparation. With interest rates playing a pivotal role in shaping the market, staying informed of the trends is crucial. Whether you're planning to buy or sell, I'm here to provide clarity and expert guidance every step of the way. Please contact me today so we can take the next steps together and ensure your success!
