San Diego, December 3, 2025
San Diego residents are facing significant challenges in homeownership as affordability declines. Only 15% of households can afford a median-priced home, approximately $1 million. Factors such as high home prices, elevated mortgage rates, and limited housing supply are exacerbating the issue. With rising rental demand and potential migration, the city confronts serious implications for its economy and community dynamics.
San Diego, California
Housing Affordability Continues to Decline in San Diego
San Diego residents are facing increasing challenges in affording homeownership, with recent studies highlighting a significant decline in affordability over the past year.
Current Affordability Status
As of the latest reports, only 15% of San Diego households can afford a median-priced home, which is approximately $1 million. This figure represents a decrease from 16% in the previous quarter and remains unchanged from the same period last year. To qualify for such a home, buyers need an annual income of at least $220,000, with monthly payments totaling around $5,550, including principal, interest, and taxes on a 30-year fixed-rate mortgage at a 6.76% interest rate.
Comparative Affordability
In comparison, the affordability rate for the entire state of California stands at 15%, with a median home price of $874,290. This indicates that San Diego’s housing market is on par with the state average in terms of affordability challenges.
Historical Perspective
Historically, San Diego has been one of the most expensive housing markets in California. For instance, in 2024, the median home price in San Diego was $1 million, with only 15% of households able to afford a home. This underscores the persistent and growing affordability issues in the region.
Factors Contributing to Declining Affordability
Several factors are contributing to the declining affordability in San Diego:
- High Home Prices: The median home price in San Diego has consistently been around $1 million, making it one of the most expensive markets in the state.
- Elevated Mortgage Rates: Mortgage rates have remained high, further increasing monthly payments and reducing affordability for potential buyers.
- Limited Housing Supply: A shortage of available homes for sale has intensified competition and driven up prices, making it more difficult for residents to find affordable options.
Implications for Residents
The ongoing decline in housing affordability has significant implications for San Diego residents:
- Increased Rental Demand: With homeownership becoming less attainable, more residents are turning to rental options, leading to higher demand and potentially increased rental prices.
- Potential Migration: The high cost of living may prompt some residents to consider relocating to more affordable areas, impacting the local economy and community dynamics.
Conclusion
The persistent decline in housing affordability in San Diego reflects broader challenges within California’s housing market. Addressing these issues requires comprehensive strategies to increase housing supply, manage demand, and implement policies that support residents in achieving homeownership.
Frequently Asked Questions (FAQ)
What is the current affordability rate for San Diego households?
As of the latest reports, only 15% of San Diego households can afford a median-priced home, which is approximately $1 million.
How does San Diego’s affordability compare to the rest of California?
San Diego’s affordability rate of 15% aligns with the state average, indicating that the challenges faced by residents are consistent across California.
What factors are contributing to the decline in housing affordability?
Key factors include high home prices, elevated mortgage rates, and a limited housing supply, all of which have intensified affordability challenges for potential buyers.
What are the implications of declining affordability for San Diego residents?
Residents may face increased rental demand, higher rental prices, and potential migration to more affordable areas, impacting the local economy and community dynamics.
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Key Features of San Diego’s Housing Affordability Challenges
| Feature | Details |
|---|---|
| Affordability Rate | 15% of households can afford a median-priced home. |
| Median Home Price | Approximately $1 million. |
| Required Annual Income | At least $220,000 to afford monthly payments of $5,550. |
| Statewide Affordability Rate | 15%, matching San Diego’s rate. |
| Contributing Factors | High home prices, elevated mortgage rates, limited housing supply. |
| Implications for Residents | Increased rental demand, higher rental prices, potential migration to more affordable areas. |
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Author: STAFF HERE SAN DIEGO WRITER
The SAN DIEGO STAFF WRITER represents the experienced team at HERESanDiego.com, your go-to source for actionable local news and information in San Diego, San Diego County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Comic-Con International, San Diego County Fair, and San Diego Pride Festival. Our coverage extends to key organizations like the San Diego Regional Chamber of Commerce and United Way of San Diego County, plus leading businesses in biotechnology, healthcare, and technology that power the local economy such as Qualcomm, Illumina, and Scripps Health. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
