If you've been following the news, you've probably seen plenty of headlines predicting a housing market correction—or even a crash. It's a fair question, and one I hear from clients all the time:
"Should I wait for San Diego home prices to come down?"
The short answer? The latest July 2026 data tells a very different story.
While the real estate market has certainly shifted from the ultra-competitive frenzy of recent years, San Diego home prices are proving to be remarkably resilient. In my latest market update, I break down the numbers and explain what's actually happening—and more importantly, what it means if you're planning to buy or sell.
Many buyers expected higher mortgage rates to cause home values to decline significantly. Instead, detached home prices continue to show strength across much of San Diego County.
The biggest reason comes down to one simple factor:
While more homes are available today than during the pandemic-era market, inventory remains relatively tight in many neighborhoods. There simply aren't enough quality homes available to satisfy buyer demand.
When supply remains constrained, prices tend to hold steady—even when borrowing costs are higher. This is one of the biggest reasons San Diego's housing market continues to outperform many national expectations.
Although prices haven't crashed, today's market looks very different than it did just a few years ago. One notable trend we're seeing is that nearly one out of every seven transactions is falling out of escrow.
That statistic tells us something important: Today's buyers are being more selective.
Whether it's financing, inspections, insurance costs, or changing circumstances, buyers are taking more time to evaluate their decisions. Sellers are also having to adjust their expectations and negotiate more frequently.
For buyers, this creates opportunities that simply didn't exist during the peak seller's market.
You can watch the complete video below.
If you've been waiting for San Diego home prices to crash or waiting for mortgage rates to suddenly fall into the fives, the newest numbers are telling a much more complicated story. [music]
Rates are still high, buyers are cautious, some homes are taking longer to sell, and the latest available data shows that about one out of every seven San Diego transactions fell out of contract. But closed sales are rising, detached home inventory has dropped sharply, and the medium detached home price has reached 1,125,000.
So, is San Diego becoming a buyer market, a sellers market, or something in between? [music] Today, I'm breaking down exactly what is happening and what it means if you're considering buying or selling.
If this is your first time to the channel and you want to know everything there is to know about moving in or out of San Diego, then subscribe and click that bell for notifications so that you can be the first to know about the current market here in San Diego, California. My name is Victoria Sandoval and I'm with Select from Your Properties. We get calls from people just like you every single day. So whether you're looking to move in 9 days or 9 months, feel free to reach out. My contact information is on the description below and I'd be happy to help you make a smooth move in or out of San Diego.
Hi everyone, I'm Victoria Sandoval, broker and owner of Select From Your Properties, and I've been helping buyers and sellers throughout San Diego County for more than two decades. In this July 2026 market update, we're talking about mortgage rates, home prices, closed sales, how many homes are available, days on the market, canceled escrows, and the biggest advantages and risks for buyers and sellers. Let's get started.
Interest rates. Let's begin with interest rates because they continue to influence almost every part of the housing market. The average 30 years fixed mortgage rate was 6.55% as of July 16th. [music] That was slightly higher than the previous week, 6.49%. 49% but still below the 6.75% average from the same week last year. The Federal Reserve held its benchmark rate between 3 and 1/2 and 3 and 3/4% at its June meeting. Its next meeting is scheduled for July 28th and 29th. Remember, the Federal Reserve does not directly set mortgage rates. That's why I would not build an entire real estate decision around predicting what may happen at one Federal Reserve meeting.
Here's a payment example. On a $900,000 30-year mortgage, the principal and interest payment at 6.55% is approximately 5718 per month. At 6%, the payment would be 53.96 per month. That is a difference roughly of $322 a month before property taxes, insurance, HOA fees, and mortgage insurance. That savings matters, but lower rates could also bring more buyers back into the market, reducing negotiation leverage on the purchase price, repairs, and seller credits. The latest complete data released in July.
Now, let's get into the local numbers because July is not over. These are not finalized July sales. This is the latest complete San Diego MLS data released in July covering the housing activity through June. During June, 2,165 homes closed escrow in San Diego County. That included 1,434 detached single family homes and 731 attached properties, including condos and town homes. Overall, closed sales increased 9.5% compared with June of last year. Detached sales increased 10.9% and attached sales increased 6.7%. So despite higher rates and affordability concerns, buyers are still purchasing homes in San Diego.
Prices also moved higher. The medium detached home price reached 1.125, up 5.1% year-over-year. The medium price for condos and town homes was 670, up 1.1%.
How many homes are for sale? At the end of June, there were 5,877 active homes for sale across San Diego County. That included 3,047 detached homes and 2,830 condos and town homes. There were also 3,75 new listings added in June. Total inventory was still down 15.3% from one year earlier. Detached inventory fell 26.1% while attached inventory was nearly flat. That limited detached home supply is one of the main reasons prices are holding up. Many buyers still have mortgage rates in the twos or threes or fours. Selling may mean giving up that low mortgage payment and purchasing their next home at a rate of above 6%. This is called the mortgage rate lock in effect. When home buyers compare their payments and decide to stay in their current homes, inventory remains limited and buyers have fewer properties to choose from.
For detached homes, the average time from listing the property until receiving an accepted offer was about 32 days. For condos and town homes, it was about 43 days. That means attached properties took approximately 11 days longer to secure a buyer. Detached homes had only 2.4 months of inventory compared to 4 months of inventory for attached properties. Condo buyers are also evaluating much more than just the sales price. They are considering the monthly HOA payment, insurance coverage, reserve fund, possible special assessments, litigation, deferred maintenance, and whether the complex qualifies for financing. A condo may have a lower
purchase price, but after adding the 700, $900, even $1,000 HOA monthly payment, the cost may no longer feel affordable. That is why a well-priced condo in a financially healthy community can still sell quickly while an overpriced unit or a property with HOA concerns may sit longer. Homes falling out of escrow.
We are also seeing transactions fall out of escrow. As of this recording, there is no finalized public July cancellation rate for San Diego. The latest public metro level data covers May and shows that 14% of San Diego pending sales fell out of contract. That is approximately one out of every seven transactions. So why are these deals falling out? Common reasons include problems discovered during the home inspection, unexpected repair costs, low appraisals, financing changes, insurance issues, HOA concerns, employment uncertainty, and buyers becoming uncomfortable with the total monthly payment. For example, an inspection may reveal an older roof, plumbing problems, or electrical panel that needs replacement. If a seller is unwilling to negotiate and the buyer does not have room in the budget, the buyer may decide to walk. With condos, a buyer may love the unit, but later discover a large special assessment, weak HOA reserves, rising insurance expenses, or pending litigation.
For sellers, getting into escrow is not the finish line. Pricing the property accurately, making complete disclosures, properly preparing the home, and carefully reviewing the buyer's financing are critical to reaching closing. For buyers, financing should be fully reviewed before writing an offer, not based on a quick online pre-qualification. If you're considering buying or selling in San Diego, do not base your decision on a national headline or an automatic online estimate. The market changes depending on the neighborhood price range, property type, condition, and HOA. Contact me and my team for a personalized home analysis or buying strategy based on your actual situation and real estate goals. My contact information is below.
Pros and cons for buyers. For buyers, the biggest change is affordability. Prices remain high. Mortgage rates are still in the mid6s, and your monthly payment may limit your options more than the purchase price itself. A well-priced remodel detached home may still receive strong interest or multiple offers. However, buyers have opportunities in this market. Depending on the property, buyers may have more time for inspections, reviewing disclosures, and completing the proper due diligence. Condos, town home, homes needing repairs and listings that have been sitting may offer room to negotiate the purchase price, repairs, closing cost, and an interest rate buy down.
Whether a seller will negotiate depends on the specific property condition days on the market, and the seller's motivation. Buyers should also remember that the lowest purchase price does not always create the lowest payment. For example, a seller may not agree to a large price reduction, but could agree to provide a credit towards the buyer's closing cost or interest rate buy down. Depending on the buyer situation, that credit could produce greater shorter term savings than a small reduction in the purchase price. My advice is to purchase only when the monthly payment works for you today. A future refinance should be a benefit, but not the only reason the purchase is affordable.
Pros and cons for the seller. For sellers, the biggest advantage is the limited detached home inventory. Sales are rising, prices are holding, and detached homes received an average of 99.1% of its original list price in June. But that does not mean every home is selling quickly or receiving close to its asking price. An overpriced home can sit on the market, lose initial momentum, and eventually require a larger price reduction than if it had been positioned correctly from the beginning. Buyers are paying close attention to the total number of monthly payment. They are comparing the mortgage, property taxes, insurance, HOA, and potential repair costs. So, when two homes are similar, buyers may choose the property that has been better maintained or the seller who's willing to help with closing costs or even if that home does not have the lowest asking price. Condo sellers must be especially strategic because buyers have more attached inventory to choose from. They are closely reviewing HOA fees, insurance, reserve funds, and overall financial health of the community. The first two weeks on the market remain extremely important.
Accurate pricing, professional staging, photography, video, maximum online exposure, complete disclosures, and easy showing access can determine whether your home creates urgency or becomes another listing buyers simply scroll past.
What's happening next? For the rest of July and into August, I'm watching three things. First, mortgage rates following the July Federal Reserve meeting. Second, whether San Diego detach home inventory remains low. And third, whether strong closed and pending sales continue through the second half of the summer.
My current read is that San Diego is not one broad buyer market or one broad sellers market. This is a segmented market. Detached homes remain supply constrained and generally favor sellers when they are priced correctly. Condos and town homes are closer to a balanced market and may provide buyers with more negotiating powers. Homes that show well, are marketed correctly, and are priced for today's payment conscious buyer are selling. Homes that ignore condition, affordability, and competition are sitting.
So, should you buy, sell, or wait? Buyers, focus on the monthly payment, complete your due diligence, and negotiate where the market data supports. Waiting for lower interest rates could reduce your monthly payment, but it could also mean facing more competition and possibly paying a higher purchase price. Sellers, there is still opportunity, especially for detached homes, but this is not the market to test an unrealistic price. Your pricing and marketing strategy must reflect what buyers can afford today, not what homes are selling for during a different market.
For a personalized home valuation review, a neighborhood specific market update or strategy for buying and selling at the same time, contact me directly. My information is below. Make sure you subscribe to the channel for honest local real estate updates without all the hype. I'm Victoria Sandoval. Thank you for watching. We'll see you in the next video. Bye.
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