As we navigate through 2025, it’s crucial to keep an eye on the economic and housing market trends shaping San Diego and the broader national landscape. Here’s a simplified breakdown of the current perspective from John Burns Research and Consulting.
Economy
• Muted Economic Forecast: The already subdued economic outlook may see a further decline in the coming months.
• Survey Data Trends: A significant amount of soft survey data has turned negative, with some hard data reflecting the same trend.
• Pervasive Uncertainty: Despite some optimistic current data, there’s a widespread sense of uncertainty.
• Global Financial Concerns: Issues like a potential shift away from US financial assets and reduced trust in markets could negatively impact interest rates and borrowing costs.
• Recession Watch: National job growth is projected at just 0.7% by 2025, signaling a potential recession risk.
Housing Market
• Market Deceleration: The housing market has slowed down, though this varies significantly by region.
• Price Trends: While national prices are up year-over-year, key homebuilder markets are seeing flat or declining prices.
• Regional Variations: Florida and Texas are notably underperforming compared to the rest of the country.
• Resale Inventory: Inventory is increasing, but many potential sellers are holding onto low mortgage rates.
• Migration Patterns: Housing affordability is driving buyers to relocate to more affordable areas.
• Material Costs: Although material costs are expected to rise, decreased activity might lead to more competitive pricing from trades.
San Diego Specifics
• Market Rating Adjustment: San Diego’s market rating has been adjusted from Very Strong to Strong as 2025 progresses slowly.
• Permits and Sales:
➡ Single-family permits are down by 2.3%.
➡ Multifamily permits have decreased by 12.1%.
➡ Existing home sales volume has increased by 2.0%.
➡ Existing home prices have grown by 1.9%.
➡ New home sales volume has risen by 1.0%.
➡ New home prices have increased by 2.4% (accounting for incentives).
Income and Job Growth
• Median income has grown by 2.8%.
• Job growth stands at 0.6%.
These insights suggest that while there are challenges ahead, there are also opportunities, particularly for those able to understand the shifting market dynamics.
Source: John Burns Research and Consulting
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Shirin Rezania Ramos | 858.345.0685 | www.shirinramos.com | Compass, DRE 0203379
