Prices of Condos in Downtown San Diego have reached a new high through the second quarter of 2022 reaching an average sold price of $815 per square foot. Condos in the luxury market, defined simply as those over 1,200sf also reached an all time high coming in at $912/SF.
The market appreciated at a fast pace as there was talk of raising interest rates encouraging buyers to get in before mortgage rates rose, which they did quite a bit in June. This jump in interest rates from about a 3% 30 year fixed rate mortgage in Q1 to about a 6% rate has slowed the market rate of sales and will slow down the appreciation rate.
Sellers are now seeing fewer offers in the market place and for the first time in over a year we are staring to see a lot of price reductions on listings as Sellers adjust to the lower demand. I expect prices to come down 5% in the 3rd quarter of 2022 and not begin to go up again till Spring 2023.