San Diego Market Update July 2021

School’s out, and as vaccination rates rise and America enters a new normal, the U.S. housing market continues along at a frenzied pace, with low interest rates and limited inventory fueling record high sales prices. May saw the median existing-home sales price exceed $350,000, a 24% increase and the largest year-over-year increase since 1999, according to the National Association of REALTORS®. Eager buyers are making multiple offers, some for well over asking price, while others are making offers on homes sight unseen.

Closed Sales increased 20.6 percent for Detached homes and 24.9 percent for Attached homes. Pending Sales increased 1.8 percent for Detached homes and 17.3 percent for Attached homes. Inventory decreased 48.1 percent for Detached homes and 51.8 percent for Attached homes.

The Median Sales Price was up 29.3 percent to $879,000 for Detached homes and 22.2 percent to $553,500 for Attached homes. Days on Market decreased 43.3 percent for Detached homes and 43.8 percent for Attached homes. Supply decreased 55.0 percent for Detached homes and 63.6 percent for Attached homes.

​​​​​​​The increase in sales prices comes with a slight decline in existing home sales nationwide, as homebuyers struggle with declining affordability amid a lack of inventory, forcing some buyers to simply wait it out in hopes of more inventory and less competition. Meanwhile, home builders are trying to meet the increased market demand, with housing starts up 3.6% in May from April, according to the Commerce Department. As we ease into new routines and look forward to a post-pandemic future, one thing remains certain: America desperately needs more homes.