San Diego Home Prices Fall Behind Inflation as Inventory Doubles
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The S&P Cotality Case-Shiller report released Tuesday shows San Diego's home price index rose just 0.94% annually through May — a figure that sounds like growth until set against the region's 3.8% inflation rate over the same period. In real purchasing-power terms, home prices have declined relative to the overall cost of living. Month-over-month, before seasonal adjustment, prices fell 0.1%, marking a second consecutive monthly decline during what is typically a seasonally stronger window.
Inventory has roughly doubled from its post-pandemic floor: active listings countywide stood at 8,221 in May, up sharply from 4,491 in 2023, though slightly below the 8,710 listed a year earlier. The market dynamics that produced instant full-price offers in 2021 and 2022 have genuinely shifted — but softening prices have not translated into meaningful affordability relief. Mortgage rates hit a 12-month peak of 6.85% last week before easing slightly to 6.76% on Tuesday, keeping monthly payments on the county's median-priced home out of reach for most residents.
On the rental side, vacancy is rising as new supply comes online, but asking rents countywide are still running between twenty-five hundred and twenty-seven hundred dollars a month — figures cited in current market reporting. The population of San Diegans who can comfortably qualify for a mortgage on the county median remains narrow, and there is no easy quadrant of this market for buyers, renters, or sellers.