‘This is nuts’: San Diego home price continues to climb as inventory plunges

San Diego County’s home price zoomed back to its previous peak — $750,000 — in January as tight inventory sparked bidding wars among buyers.

Local prices increased 17.2 percent in a year as of January, reported CoreLogic/DQNews on Thursday. The median — which includes new and resale condos, townhouses and single-family homes — dipped slightly in December but returned to the record high reached in November.

There were 2,573 home sales in January, the lowest since April and May 2020 when the start of the pandemic brought the real estate market to a near stop. The low sales were attributed by housing experts to a scarcity of homes for sale, as opposed to any slowdown in demand.

From Jan. 3 to Jan. 30, 2,148 homes were listed for sale throughout San Diego County, said the Redfin Data Center. That compares to 3,519 around the same time last year; 5,462 in 2020; 7,621 in 2019; 5,707 in 2018; and 6,053 in 2017.

“I look every day and there isn’t much,” said Samantha O’Brien, a real estate agent with PorchLight.

Demand for what limited property is available makes for some wild transactions. O’Brien said she put a 1,260-square-foot condo in Point Loma on the market in January and got 16 offers in a few days, and 15 of them were over the asking price. The condo, built in 1964, ended up selling for $730,000 — $81,000 over the asking price.

Redfin said the percentage of homes off the market in two weeks was 70 percent in January, its highest since May 2021.

Home sales can sometimes exceed listings in a given month, like in January, if the process to close a sale, called escrow, takes more than a month. A more likely scenario in the current environment: If homes sell too fast they don’t make final inventory numbers, which are calculated weekly and monthly.

January is typically the slowest month for sales. However, it was the smallest number of sales for January since 2019.

For now, buyers seem unfazed by rising interest rates. The interest rate for a 30-year, fixed-rate mortgage was 3.45 percent in January, reports Freddie Mac, up from 2.74 percent the year before. The rate is up from December 2020’s average of 2.68 percent, which was the lowest in records going back to 1971.

Mauricio Perez-Vazquez, an agent with Twenty Four Seven Realty, said rising interest rates have seemingly had the opposite effect: It is pushing buyers to get off the fence and buy.

“I’m still waiting for some (buyer) fatigue to set in. This is nuts,” he said.

Perez-Vazquez, who is also a director with San Diego-based National Association of Hispanic Real Estate Professionals, said the problem with inventory is that homeowners here are afraid to list their properties because they are worried they won’t be able to find another home in the region after they sell.

Here’s how prices and sales broke down by home types:

• Resale single-family: A new median of $845,000 was reached, exceeding the previous peak of $840,000 from July. There were 1,645 sales, its lowest since January 2021.
• Resale condos: Median of $583,000, down from the peak of $590,000 reached in November. There were 808 sales, its lowest since May 2020.
• Newly built: Median of $755,000 with 120 sales, its lowest since January 2019. The peak of $812,500 was set in October 2018 when there was an influx of luxury single-family homes for sale.

Price gains were up across Southern California in January. Riverside County was up the most, 20.5 percent, for a median of $550,000.

It was followed by Orange County, up 18.9 percent for a median of $950,000; San Bernardino County, up 17.3 percent for a median of $475,000; San Diego County with the 17.2 percent increase; Ventura County, up 15.4 percent for a median of $750,000; and Los Angeles County, up 14.6 percent for a median of $791,000.