San Diego, January 28, 2026
The San Diego real estate market is witnessing a decline in home prices, with the median sale price dropping to $930,000, a 1.8% decrease from the previous year. This shift is highlighted by an increase in inventory, yet fewer new listings available. Affordability remains a primary challenge, as only 1.6% of homes are within reach for median-income earners. Lower mortgage rates may further exert influence on home prices and buyer demand, complicating the market landscape for both buyers and sellers.
San Diego Real Estate Market Experiences Price Decline in December 2025
San Diego, CA – In December 2025, the San Diego real estate market saw a notable decrease in home prices, marking a significant shift from previous trends. The median sale price for homes in the area was $930,000, reflecting a 1.8% decline compared to the same month in 2024. This downturn is part of a broader trend, as nearly 78% of homes in the San Diego metro area experienced a decrease in value over the past year, surpassing the national average.
Inventory and Market Dynamics
The number of homes available for sale in San Diego increased by 17.8% year-over-year in December, reaching a total of 1,566 active listings. Despite this rise in inventory, the number of newly listed homes decreased by 15.6% compared to the previous year, indicating a release of previously unsold properties. Homes in San Diego spent an average of 54 days on the market in December, slightly longer than the national average of 73 days.
Affordability Challenges
Affordability remains a significant concern for many residents. A recent analysis revealed that only 1.6% of San Diego homes are affordable for households earning the area’s median income, making it one of the most challenging U.S. housing markets for average earners. To afford a typical home in San Diego, a household must earn approximately $221,900 annually.
Impact of Mortgage Rates
Lower mortgage interest rates are expected to influence the housing market by attracting more buyers and potentially driving home prices higher. With the median home price just under $1 million, reduced rates—from the current average of 6.1% to a potential 5.5%—could exacerbate demand in a market already suffering from low housing inventory. Experts suggest buyers might want to act now before prices rise further due to increasing competition.
Market Outlook
As the San Diego real estate market continues to evolve, both buyers and sellers are navigating a landscape marked by fluctuating prices and inventory levels. Prospective buyers are advised to stay informed about market trends and consider consulting with real estate professionals to make well-informed decisions.
Frequently Asked Questions (FAQ)
What was the median sale price for homes in San Diego in December 2025?
The median sale price for homes in San Diego in December 2025 was $930,000, reflecting a 1.8% decline compared to the same month in 2024.
How many homes were available for sale in San Diego in December 2025?
In December 2025, there were 1,566 active listings in San Diego, marking a 17.8% increase year-over-year.
What percentage of San Diego homes are affordable for median-income households?
Only 1.6% of San Diego homes are affordable for households earning the area’s median income, making it one of the most challenging U.S. housing markets for average earners.
How might lower mortgage interest rates affect the San Diego housing market?
Lower mortgage interest rates are expected to attract more buyers and potentially drive home prices higher, exacerbating demand in a market already facing low housing inventory.
What is the current average mortgage interest rate in San Diego?
The current average mortgage interest rate in San Diego is 6.1%, with potential to decrease to 5.5%, which could influence buyer demand and home prices.
Key Features of the San Diego Real Estate Market in December 2025
| Feature | Details |
|---|---|
| Median Sale Price | $930,000 (1.8% decline year-over-year) |
| Active Listings | 1,566 homes (17.8% increase year-over-year) |
| New Listings | 15.6% decrease compared to previous year |
| Average Days on Market | 54 days (slightly below national average of 73 days) |
| Affordability | 1.6% of homes affordable for median-income households |
| Potential Mortgage Rate | 5.5% (down from current average of 6.1%) |
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Author: STAFF HERE SAN DIEGO WRITER
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