Home prices skyrocketed in San Diego and the rest of the country last year, and odds are that your home earned more than you did.
Zillow reports that home values in the San Diego-Carlsbad metro area increased $160,493 in 2021 which is $105,790 more than our 2021 median income.
Citing the S&P Case-Shiller Home Price Index, the San Diego Union-Tribune shows an increase of 25.9 percent in home prices in San Diego.
The North San Diego County REALTORs HomeDex notes the median sales price jumped from $675,000 in 2020 to $812,000 in 2021. And, although we didn’t beat the record set in July 2004 when prices increased by 33.4 percent annually, your home probably earned more than you did last year.
A recent Fannie Mae survey shows that consumers expect that mortgage rates and home prices will continue to rise, but it hasn’t slowed down our market yet. San Diego County homes sold for 105.5 percent of their asking price in February and the annual median price increased by 17.5 percent.
Pent up demand, low housing supply and historically low interest rates have all contributed to this rapid upturn in prices. If you’re a homeowner, you’ve seen your wealth increase significantly. This increased home equity can make a big difference if you are planning to move. You’ve got a larger down payment for your next home and might even be able to cover the cost of that home with your equity.
Rising Home Prices Push Buyers Out
Rapidly increasing prices paired with rising interest rates have pushed about 87.5 million households out of the market nationally. They can no longer afford to buy a median-priced home. And home prices here in San Diego are much higher than the national average. By the end of 2021, only 23 percent of households in San Diego could afford to purchase a median-priced home. Even though incomes are on the rise, they aren’t keeping up with housing prices or higher interest rates.
As values continue to climb and mortgage rates increase, fewer and fewer buyers will be able to purchase a home in San Diego County. So, even though your home probably earned more than you did last year, this can’t go on forever. If you’re planning on selling your home, you might not want to wait.