What's Really Happening in the San Diego Housing Market Right Now
Ask five different people what the San Diego housing market is doing this spring and you'll probably get five different answers. Some will tell you it's on fire. Others will tell you buyers have disappeared. Both are half right, depending on what part of the market they're looking at.
The spring 2026 market is heating up — but it's heating up inside one of the most volatile mortgage rate environments we've seen in years. Inventory is moving in opposite directions depending on property type, buyer demand is reacting to rate swings almost week to week, and the headlines aren't doing a great job of separating the signal from the noise.
Here's a breakdown of what's actually happening with inventory, detached homes, condos, mortgage rates, and where I see this market heading over the next few months.
Watch the full video: youtu.be/2pMGBCEw8l0
The Local Market Snapshot
Spring is typically San Diego's busiest stretch of the year, and this year is no exception on the surface — buyer traffic is up, showings are up, and there's more activity across the board than we saw over the winter. But underneath that seasonal bump is a market that's more fragile than it looks. Instead of steady, predictable momentum, we're seeing activity that surges when rates dip and stalls when they climb back up. It's a stop-and-go spring, not a straight-line one.
Detached Homes: Still the Tightest Segment
Detached, single-family homes remain the scarcest product type in San Diego, and that scarcity is doing a lot of the work in keeping prices firm. Inventory is still running well below where it was a year or two ago, largely because homeowners sitting on 3-4% mortgages have little incentive to sell and trade up into a 6%+ rate. That lock-in effect continues to choke off new listings.
The result: well-priced, updated detached homes in good locations are still moving quickly, often with multiple offers. Homes that are overpriced or need work are the exception — they're sitting, and sitting longer than they would have a year ago.
Condos and Townhomes: More Room to Negotiate
The attached market is telling a noticeably different story. Condo and townhome inventory has been building, which is giving buyers real negotiating leverage that simply doesn't exist right now in the detached segment. Pricing has softened slightly compared to last year, and days on market have stretched out.
For buyers who've been priced out of single-family homes, this is where the opportunity is right now — more inventory to choose from, less competition, and more room to negotiate on price and terms.
What's Happening With Mortgage Rates
Rates are the variable driving almost everything else in this market. There was a window earlier in the year where rates dipped and buyer activity picked up meaningfully. Since then, rates have climbed back into the mid-6% range, and that back-and-forth has made it hard for anyone to plan with confidence. Buyers are rate-shopping and hesitating. Sellers are unsure whether to list now or wait for the next dip. Inflation pressure and broader economic uncertainty have kept the Fed cautious, which has made this rate environment choppier and less predictable than most people expected heading into the year.
Recession Concerns and My Take
There's real anxiety out there about a broader slowdown, and it's not unfounded. But San Diego's economy has some built-in resilience that's cushioning the housing market from the kind of hard landing you might see elsewhere. Biotech, the military, tourism, healthcare, and higher education all continue to support local employment, and none of those sectors are showing real signs of distress. That doesn't mean this market is immune — higher-for-longer rates are a real headwind — but it's part of why this feels more like a slow grind than a crash.
What Happens Next in the Market
Expect more of the same push-and-pull over the next few months: tight detached inventory continuing to support pricing, condos and townhomes offering buyers more give, and mortgage rates whipsawing based on whatever economic data comes out next. If rates ease in a meaningful way, expect a fast surge of both buyer demand and new listings from sellers who've been waiting on the sidelines. If rates stay elevated, expect this same choppy, grind-it-out pace to carry through the rest of spring and into summer.
Final Thoughts for Buyers and Sellers
If you're buying, condos and townhomes currently offer the most negotiating room, while detached homes require being decisive and fully prepared given how tight that inventory is.
If you're selling, pricing accurately matters more than it has in a while — overpriced listings are sitting on the market, while well-priced homes, especially detached homes, are still moving fast.
Every buyer and seller's situation is different, and the right strategy depends on your specific goals and timeline. If you're thinking about buying or selling in San Diego and want help building a plan for this market, send our team a message — we're happy to help.
The Sean Zanganeh Real Estate Team Keller Williams Realty 12750 High Bluff Dr, Suite 300, San Diego, CA 92130
📞 (858) 345-9995 📧 [email protected] 💻 MySDDreamHome.com
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Sean Zanganeh DRE #1851910 | DRE #01524589
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