San Diego is one of the fastest cooling housing markets in the entire country, according to Redfin.
Of the top 10 fastest cooling housing markets listed, San Diego takes the eighth spot. This comes after home values were red-hot and appreciating rapidly in the San Diego area.
“The last two months I would say we’ve seen a slow down so even with people attending open houses it’s a little bit slower, but I will say for the buyers that are out in the field right now, they’re making huge wins because sellers are realizing the market has shifted and now, we are actually seeing concessions and those concessions were not happening before,” San Diego Realtor Destiny Roxas said.
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Many housing market experts attribute the cooling as being a part of the housing cycle along with uncommon factors like a hot market during the pandemic preceding the cooling.
“One thing that matters a lot is expectations. The second thing that matters a lot is housing supply and by that, I mean, physical supply and the third thing that matters a lot is the supply of credit, buy mortgages from the banking side,” UC San Diego Professor Michael Reher said.
One of the top reasons for the cooling housing market is rising interest rates. The U.S. Federal Reserve has been raising interest rates to fight inflation. Those interest rate hikes led to lenders raising home mortgage rates, which impacts affordability.
Experts are saying the cooling housing market is not necessarily a bad thing.
“It’s a little different than we’ve seen in the last two years. I think it’s honestly a good thing. It’s a good thing for buyers,” Roxas said.
Housing experts predict San Diego’s housing market will heat up again in the future.
“I definitely think that because of the demand in San Diego, the demand to be here, obviously the military, tourism and a lot of tech coming in, I definitely see San Diego being one of the more popular spots to gravitate toward,” Roxas said.