Recent developments at the Horton Campus and IQHQ have reignited optimism about the future of Downtown San Diego’s real estate market. While new commercial tenants are moving in, it’s important to note that, so far, no Biotech or MedTech companies have signed on. Despite this, there is hope that these life science hubs will eventually boost property values. However, the reality is that some of the current additions—such as the high-end Mexican restaurant Javier’s, Shake Shack, a window treatment company, and a Rivian electric truck showroom—are unlikely to make a significant impact on real estate prices.
While The Neuman Team, along with many San Diegans, eagerly looks forward to the success of these ventures, we must keep our expectations in check. Even if these businesses perform well, they may not directly affect condo prices in Downtown San Diego. The key issue is that the average salaries in the life sciences sector don’t align with the cost of homeownership in the 92101 zip code.
As of Sept. 23, the average annual salary for a Biotechnology Technician in San Diego is $51,489, or approximately $24.75 per hour. This income level is far from what’s required to purchase most of our Downtown condos. To put it into perspective, the average condo price in 2022 was $901,525. Even with a 20% down payment of $180,000, a buyer would need an annual salary of around $195,000 to qualify for a mortgage—assuming a 6.2% interest rate. Clearly, this places homeownership out of reach for many workers in these industries.
It’s not just technicians who face this barrier. Biotech scientists, who earn an average salary of $94,078 as of Sept. 22, still fall short of the income needed to comfortably purchase a Downtown condo. While these salary levels might support demand for high-rise apartments, even renting in 92101 can be quite expensive.
There is some hope that the lower end of the Downtown condo market may see sales activity, potentially creating opportunities for move-up buyers over time. However, without a significant drop in interest rates—ideally to the low 5% range—the market is likely to remain out of reach for many buyers in the life sciences sector.
That said, Downtown residents can still look forward to positive changes in the area. The park under construction, new restaurant offerings, and planned fitness centers will undoubtedly enhance the community’s appeal. But don’t expect these amenities to translate into a substantial increase in property values anytime soon.
