Buy Now or Wait? Let’s Break Down San Diego’s Market
Buy Now or Wait? Let’s Break Down San Diego’s Market
The central question in the San Diego market has become a high-stakes dilemma: Should I buy now or wait for rates to drop?
As we move into the middle of the year, transaction numbers are scraping levels not seen since 2009—an epoch of total real estate meltdown. While we are not in a 2009 scenario (values are holding), the market is stuck. Global and economic uncertainties, combined with dynamic interest rates, are creating a unique paralysis that only a robust strategy can overcome.
As The GreenHouse Group, we believe this environment is an inflection point. The biggest boons in wealth are historically made when everyone else is hesitant. Here is our breakdown of the July 2025 market and the strategies needed to win.
📉 The Affordability Crisis is Fueling Cancellations
The true barrier to entry is high rates and record-low affordability:
- Affordability Index: We are seeing historic lows across the county. For detached homes, the index sits at just 25, climbing only slightly to 39 for attached homes. Most buyers are qualifying to their absolute maximum.
- Rate Volatility: High interest rates aren’t just high; they are dynamic. Rates can move a quarter percent in a single morning.
This volatility is driving massive contract cancellations. Many buyers are running the activities (getting pre-approved, submitting offers) only to freeze when they see the final, high payment. Being a successful buyer means staying in constant, dynamic communication with your agent and lender after pre-approval to ensure your numbers hold.
⬆️ Inventory Rises & Prices Get ‘Stuck’—Your Biggest Opportunity
While the market feels stuck, inventory is climbing dramatically, giving buyers newfound power:
- Detached Inventory: Up 25.6%
- Attached Inventory: Up 49.9%
This inventory spike is finally causing the San Diego list-to-sale price ratio to drop. Buyers are no longer automatically paying over list price; we are seeing successful negotiations at 98.7% (detached) and 97.9% (attached) of list price.
The Golden Rule for Today’s Buyer: The first thing to fly out the window when rates finally improve is price. While the market is currently “stuck in the mud,” you have the opportunity to lock in a price that will become a massive win when the pent-up demand returns.
🔑 Monetary Strategy: How to Overcome Rate Uncertainty
Buying now requires a dynamic monetary plan, not just a static 30-year fixed rate. We are helping clients navigate this uncertainty using three core strategies:
- Rate Tracking & Timing: We don’t just lock your rate on day one. We follow the market daily, providing you with a chart and advising you on the optimal moment to lock while you are in escrow, effectively manipulating the volatility to your advantage.
- Temporary Buydowns: Loan programs now exist that allow you to effectively lower your rate for a period (e.g., one year). This eases the immediate affordability shock while you wait for the larger market to recalibrate and potentially for rates to fall.
- Active Communication: Simple tools like a dedicated group text with your agent and loan officer are critical. This allows us to dynamically check and confirm your final payment when you find “the one,” preventing you from becoming another cancellation statistic.
🏚️ The Attached Market is Getting “Kicked In”
Attached properties (condos and townhomes) are faring the worst in this market, suffering from the biggest drops in sales and highest days on market. This is due to issues completely outside of market sentiment:
- HOA Instability: New, strict building safety requirements and fire insurance mandates are straining HOA finances.
- High Risk: HOAs are facing multiple fee increases and mandatory special assessments, driving buyers away who fear the long-term stability and cost of their association.
🤝 Your Next Step: Strategy Over Hesitation
The market is not a time for hesitation; it is a time for calculated, strategic action. Sellers must focus on the prep stage and price ahead of the market. Buyers must lock in the price that today’s “stuck” market allows.
You need a team that can see all the moves down the chessboard, from initial pre-approval to the final payment and closing day.
Ready to build your winning game plan?
We flesh out these strategies in detail through our monthly educational programs:
- Buy Side: Attend our Home Buyer Class
- Sell Side: Attend our Seller Workshop