San Diego Home Prices Drop 4 Months: What Sellers Need to Know
TL;DR
San Diego County's median home price dropped to $975,000 in September 2025, marking the fourth consecutive monthly decline and a 0.85% annual decrease. Only 29% of homes now sell above asking price, down from 71% in April 2022. This decisive shift toward a buyer's market creates new challenges—and opportunities—for San Diego homeowners looking to sell quickly.
The San Diego Market Shift Is Here
After years of relentless price growth, San Diego County's housing market has entered a new phase. The median home price for single-family homes fell to $975,000 in September 2025, representing the fourth consecutive month of declines and a 0.85% drop from the previous year, according to the S&P Case-Shiller Home Price Index.[1]
This marks a significant departure from the white-hot seller's market that characterized the pandemic era. In April 2022, 71% of San Diego homes sold above asking price. By September 2025, that figure plummeted to just 29%.[1] For homeowners considering a sale—whether due to inheritance, relocation, financial pressure, or life changes—understanding this market shift is crucial to making informed decisions.
"Affordability is the biggest constraint in the market right now," notes Lisa Sturtevant, chief economist at Bright MLS.[1] With mortgage rates hovering around 6.30% and median prices still near the $1 million mark, San Diego is tracking toward one of its slowest sales years since records began in 1988.
What the Numbers Tell Us About San Diego Real Estate
Price Trends Across the County
The September 2025 data reveals a market in transition:
- Median price: $975,000 for single-family homes
- Annual decline: 0.85% year-over-year
- National context: While U.S. home prices rose 1.3% nationally (the slowest growth in over two years), San Diego ranked 15th among 19 major metro areas tracked[1]
- Sales volume: Through September, San Diego recorded 20,504 home sales—putting the county on track for one of its weakest years since 1988[1]
The Affordability Crisis Deepens
San Diego's housing affordability has reached historic lows. The median home price of $985,092 represents 8.7 times the median household income of $112,933.[2] Only 15% of San Diego residents can afford a median-priced home in 2025, with the average household needing to dedicate 51% of monthly income to mortgage principal and interest.[2]
This affordability crisis is reshaping buyer behavior across neighborhoods:
| Neighborhood | Median Price | Year-Over-Year Change | Cash Buyer % |
|---|---|---|---|
| La Jolla | $2,500,000 | +5% | 78% |
| Pacific Beach | $1,300,000 | -4.3% | 35% |
| North Park | $950,000 | +4% | 25-35% |
| County Average | $975,000 | -0.85% | 22% |
Data compiled from Multiple Listing Service and county records, September 2025[3][4]
The Two-Tier Market: Luxury vs. Mid-Range
Economist Lisa Sturtevant identifies a "K-shaped" market dynamic emerging in San Diego.[1] While luxury properties over $2 million continue to perform well—with 68% of buyers paying cash and properties receiving multiple offers—mid-range inventory struggles to move.
This split creates distinct market conditions:
Luxury segment ($2M+):
- 2.8 months of inventory (strong seller's market)
- 68% all-cash purchases[3]
- Minimal impact from interest rates
- International buyers paying average of $4.2 million[3]
Mid-range segment (Under $1M):
- Softening demand
- Longer time on market (median 25 days, up from 20 days in October 2024)[2]
- Greater price sensitivity
- Increased negotiation leverage for buyers
For homeowners in neighborhoods like Pacific Beach, North Park, Mission Beach, and Hillcrest, this two-tier reality means traditional sales can take significantly longer than during the seller's market peak.
What This Buyer's Market Means for San Diego Sellers
Traditional Sales Face New Challenges
The shift toward a buyer's market introduces several complications for traditional home sales:
- 1 Extended timelines: The average time to sell a house in San Diego is now 80 days—45 days on market plus 35 days to close.[5] In a cooling market, these timelines can stretch even further.
- 2 Reduced negotiating power: With only 29% of homes selling above asking price (compared to 71% in April 2022), sellers must be more realistic about pricing and open to negotiations.[1]
- 3 Increased buyer scrutiny: As competition eases, buyers conduct more thorough inspections and request more repairs or price concessions.
- 4 Financing contingencies: With mortgage rates around 6.30%, buyer financing can fall through, extending or canceling sales.[1]
- 5 Carrying costs: Longer selling periods mean continued mortgage payments, property taxes, insurance, and maintenance costs.
When Speed and Certainty Matter Most
Certain life situations make the traditional selling process particularly challenging:
- Inherited properties: Managing an estate from out of town while waiting months for a traditional sale adds stress and expense
- Relocation: Job transfers or family emergencies require quick closings that traditional sales can't accommodate
- Financial distress: Pre-foreclosure situations demand immediate solutions, not 80-day sales processes
- Property condition issues: Homes needing significant repairs struggle in a buyer's market where competition gives buyers more choices
- Divorce situations: Both parties benefit from quick, certain sales that divide assets cleanly
The Cash Sale Alternative: Speed vs. Price Trade-offs
Understanding Cash Buyer Timelines
Cash home sales in San Diego typically close in 7-14 days, with some transactions completing in under a week when title is clear.[6][7] This represents a dramatic time savings compared to the 80-day average for traditional sales.
Traditional Sale Timeline:
- List property: 1-2 weeks for preparation and marketing
- Market period: 45 days average[5]
- Inspection and negotiation: 1-2 weeks
- Buyer financing: 2-4 weeks
- Closing: 35 days average[5]
Total: 80+ days
Cash Sale Timeline:
- Initial contact and offer: 24-48 hours
- Accept offer: Immediate
- Title and escrow: 7-14 days[6][7]
Total: 7-14 days
The Price Consideration
Cash offers typically range from 70-80% of a property's fair market value.[7] This discount reflects several factors:
- No agent commissions (typically 5-6%)
- No seller closing costs
- No repairs or renovations required
- Guaranteed closing (no financing contingencies)
- As-is condition acceptance
- Significantly faster transaction
Example: $975,000 Median-Priced San Diego Home
- Traditional sale net proceeds (after 5% commission and $10K closing costs): ~$916,000
- Cash sale at 75% of value: ~$731,000
- Price difference: ~$185,000
- Time savings: 60-70 days
When Cash Sales Make Financial Sense
The speed premium of a cash sale provides real value in specific scenarios:
- 1 Avoiding foreclosure: Saving your credit is worth thousands in future borrowing costs
- 2 Stopping carrying costs: On a $975K home with a $5,000 monthly payment, two months saved equals $10,000
- 3 Inheritance situations: Quick sales avoid probate complications and family disputes
- 4 Major repairs needed: Deferred maintenance can cost more than the cash sale discount
- 5 Time-sensitive relocations: Missing job start dates or double housing payments erodes the traditional sale premium
Neighborhood-Specific Market Dynamics
Pacific Beach: Mid-Range Market Softening
Pacific Beach properties face headwinds from the affordability crisis. With a median price around $1.3 million (down 4.3% year-over-year), the neighborhood sits squarely in the challenging mid-range segment.[3] However, Pacific Beach shows 35% cash buyer activity—significantly above the 22% county average.[3] Properties requiring renovation or in condo buildings with strict financing requirements find particularly strong interest from cash buyers who can close without lending obstacles.
La Jolla: Luxury Market Resilience
La Jolla's $2.5 million median price positions it in the resilient luxury tier. With 78% cash buyers and 85% of international buyers paying cash, the neighborhood maintains strong seller conditions.[3] Properties here continue receiving multiple offers and selling quickly despite broader market cooling.
North Park: Affordable Segment Strength
North Park's $950,000 median price (up 4% year-over-year) demonstrates continued demand in San Diego's most affordable neighborhoods.[4] Homes often sell within days of listing, though the overall market shift toward buyer conditions still applies.
Mission Beach, Hillcrest, South Park
These coastal and central San Diego neighborhoods experience similar dynamics to Pacific Beach—strong underlying demand constrained by affordability challenges and the shift toward buyer market conditions.
Quick Facts: San Diego Housing Market September 2025
| Metric | Value | Context |
|---|---|---|
| Median Home Price | $975,000 | Down 0.85% annually[1] |
| Above-Asking Sales | 29% | Down from 71% in April 2022[1] |
| Year-to-Date Sales | 20,504 | Tracking toward slowest year since 1988[1] |
| Affordability Rate | 15% | Only 15% of residents can afford median home[2] |
| Average Days on Market | 45 days | Plus 35 days to close[5] |
| Cash Sale Closing | 7-14 days | No financing contingencies[6][7] |
| Mortgage Rate | 6.30% | As of late September 2025[1] |
Frequently Asked Questions
Is now a bad time to sell a house in San Diego?
Not necessarily—it depends on your situation. While the market favors buyers more than in 2021-2022, San Diego home prices remain elevated with a $975,000 median. If you need to sell due to financial pressure, relocation, inheritance, or life changes, waiting for a market rebound could cost more in carrying costs and stress than selling now with realistic expectations.
How long does it take to sell a house in San Diego in 2025?
Traditional sales average 80 days from listing to closing—45 days on market plus 35 days to close the transaction.[5] In the current buyer's market, properties priced aggressively or needing repairs may take longer. Cash sales typically close in 7-14 days regardless of market conditions.[6][7]
What percentage of San Diego homes are cash purchases?
County-wide, approximately 22% of San Diego home sales are cash purchases.[3] However, this varies significantly by neighborhood and price point—La Jolla sees 78% cash buyers, while Pacific Beach shows 35% cash activity.[3] The luxury segment ($2M+) has 68% cash buyers.[3]
Should I wait for San Diego home prices to recover?
This depends on your timeline and financial situation. The S&P Case-Shiller Index shows four consecutive months of price declines, and affordability is at "multi-decade lows."[1] Economic forecasting is uncertain, but carrying costs during a wait-and-see approach can be substantial—especially if you're managing an inherited property, facing financial pressure, or paying for vacant property maintenance.
What's the difference between selling to a cash buyer and listing with an agent?
Traditional agent listings take 80 days average, require repairs and staging, involve showings and open houses, and depend on buyer financing approval. You net 90-95% of sale price after commissions and costs. Cash sales close in 7-14 days, require no repairs or showings, have no financing contingency risk, and typically offer 70-80% of market value.[5][6][7] The right choice depends on whether you prioritize maximum price or speed and certainty.
Can I sell my San Diego house as-is without making repairs?
Yes, particularly with cash buyers. In a buyer's market, traditional buyers increasingly request repairs or price concessions after inspections. Cash buyers like San Diego Fast Cash Home Buyer purchase properties in as-is condition, eliminating repair costs and hassles.[7] This is especially valuable for inherited properties, fixer-uppers, or situations where you can't afford or don't want to invest in repairs before selling.
Conclusion: Making Informed Selling Decisions in a Shifting Market
San Diego's four-month home price decline signals a fundamental market shift that creates new challenges for sellers. The days of 71% of homes selling above asking price are behind us, replaced by a more balanced—and in many segments, buyer-favoring—market.
For homeowners in Pacific Beach, La Jolla, Mission Beach, North Park, Hillcrest, South Park, and throughout San Diego County, this new reality demands strategic thinking. Traditional sales still make sense for sellers who have time, properties in excellent condition, and no pressing need for quick closing. But for those facing inheritance situations, relocation, financial pressure, or major property issues, the speed and certainty of a cash sale may provide better overall value than waiting months for a traditional sale in uncertain market conditions.
The key is understanding your specific situation, running the numbers on carrying costs versus sale price, and choosing the path that aligns with your timeline and priorities.
Need to Sell Your San Diego Home Quickly?
San Diego Fast Cash Home Buyer purchases houses throughout San Diego County in as-is condition, closing in as little as 7-14 days. Whether you're dealing with an inherited property, facing relocation, managing financial challenges, or simply need a fast, certain sale, we provide fair cash offers with no repairs, showings, or financing contingencies.
Contact us today for a no-obligation cash offer on your San Diego property. Let's discuss whether a quick cash sale makes sense for your situation in this shifting market.
Ready to Sell Your San Diego Home Fast?
Get a fair, written cash offer within 24-48 hours. No repairs, no showings, no financing contingencies. Close in as little as 7-14 days or on your timeline.
Free consultation • No obligation • 3-day cancellation period included
Citations
- [1] San Diego Union-Tribune: 'Affordability is the biggest constraint': San Diego home prices fall for 4th month - Accessed 2025-12-11
- [2] Luxury SoCal Realty: San Diego Housing Market Statistics & Forecast - Accessed 2025-12-11
- [3] Luxury SoCal Realty: Pacific Beach Real Estate Market Report 2025 - Accessed 2025-12-11
- [4] Luxury SoCal Realty: La Jolla Housing Market 2025 - Accessed 2025-12-11
- [5] List With Clever: Average Time to Sell a House in San Diego 2025 - Accessed 2025-12-11
- [6] HomeLight: How to Sell My House for Cash in San Diego - Accessed 2025-12-11
- [7] Houzeo: 6 Best Companies That Buy Houses for Cash in San Diego - Accessed 2025-12-11