While Southern California’s housing market is booming, San Diego’s tight market requires targeted investment
Southern California’s housing market is steadily booming, and San Diego is no exception.
Home prices and sales are rising across Southern California. A recent report released by the California Association of Realtors shows that the Southern California region was holding strong in January with a year-over-year sales growth of 13.5%. The median home price stayed around $650,000, showing a gain of just over 14% in 2020, with a high point coming in September of that year.
The same trend can be seen in San Diego County. The San Diego real estate market weathered the COVID pandemic successfully and continues to see tight availability in both single-family and multi-family housing. As a result, in 2020, San Diego’s real estate market saw the following changes:
- The median home price increased from $580,000 to $665,000 during 2020.
- The number of closed homes dropped -18.8% YOY, and the average days on market fell from 34 days to 20 days in that same timeframe, demonstrating a tight market marked by limited supply.
- Rental prices remained relatively flat in all of 2020, with an average apartment costing just over $2000/mo. This flat performance during COVID-19 shows strength opposed to other markets that saw declines during 2020.
The combinations of these statistics demonstrates that San Diego maintains high housing demand overall. During this tight market, San Diego’s best investment opportunities are in the multifamily and single-family rental markets. San Diego also has some of the highest gross profits in the nation when flipping a home. So, while a good fix and flip opportunity might be rare, it could reap huge benefits.
Market experts predict that San Diego’s housing market will continue to be weighted for sellers. Based the forecast for 2021, investors can expect to see many of the same factors impacting the market this year continuing: few homes for sale, low mortgage rates and a very limited number of distressed sales.
While inventory might be harder to find, real estate investors with strong strategies can still profit. So it’s more important than ever to have a real estate team that helps you close properties quickly and certainly, and run your construction or rehab projects smoothly. That’s what Lima One Capital provides investors in San Diego and around the country. Get started today and let Lima One supercharge your investment success.