The San Diego condo market in downtown sort of had two different lives during 2022. In the first half of the year prices were rising about 1.0% per week! Prospective buyers were faced with a lot of competition and almost always there were multiple offer and almost always the selling price was above the asking price, sometimes as much as 20% over asking. As for prices, they peaked in May 2022. Thats because the rate of inflation was rising rapidly and investors began wanting a higher interest rate. We saw mortgage rates climb from 3% to 6% and this really froze the market.
Buyers were no longer as anxious to buy and were worried of house prices falling and Sellers decided to stay put and keep their 3% mortgage and not sell and buy something else with a 6% mortgage. This led to prices falling in the 3rd quarter and again in the 4th quarter but at a much slower pace. As I write this in Feb 2023, prices have stabilized with the luxury market doing better and rising in price while the entry level is still soft and very interest rate sensitive.
As 2023 kicked off, the market started off flat and the available inventory was the lowest level its been in 15 years.