I have received lots of emails and questions regarding what I anticipate will happen next in the 92101 real estate market.

First, the San Diego County marketplace in general. The single-family market remains hot, mainly because of lack of inventory. As long as interest rates remain as what people perceive as high, then inventories will remain low, as sellers will remain reluctant in taking on higher interest rate loans.

Now, for buyers waiting for mortgage rates to fall much more and then buy, prices are likely to be rising across many markets over the next three or more years. Lower mortgage rates bring in more inventory, but lower rates also bring in a lot more demand and that demand has been building for several years now! It will probably not take even a large rate drop to start a surge in buyers taking to the market.

Second, the 92101 market is unique in San Diego County. Despite the robust single-family market, the condominium market continues to struggle. High interest rates, increased inventory, and lack of buyers have pushed the year-to-year inventory of homes up. June of 2023 there were 90 properties for sale in 92101, in July of 2024 there are 245 properties for sale and 32% of all listed homes condominiums have had a price reduction!

The SALT (State and Local Tax) act of 2017 capping property tax, income taxes paid and sales tax deductions paid at a total of $10,000, has decimated the second home sales market. 35% of our homes in 92101 are second homes and/or rentals. The financial advantage of a second home tax wise has been greatly reduced. That SALT deduction cap of $10,000 per household will expire in 2025, unless renewed.

The 92101 market place will remain a very price sensitive until interest falls.