As 2025 comes to a close, San Diego buyers are preparing for a market that looks very different from the frantic, competitive atmosphere of recent years. Inventory is rising, price growth has cooled, and mortgage rates are beginning to ease — and those shifts could make 2026 one of the most balanced buying environments we’ve seen in a decade.
If you’re planning to make a move next year, here are the key signals to watch as we transition into 2026:
With 2025 winding down and a new year approaching, San Diego buyers are asking the same question:
Is 2026 a good time to buy a home — or should you wait?
The answer depends on market conditions that are shifting right now, especially as inventory rises, pricing stabilizes, and mortgage rates show signs of easing. If you’re planning to make a move in early 2026, the decisions you make today could affect your negotiating power and long-term costs.
Here’s what San Diego buyers should pay attention to this week as we head into the new year.
1. Inventory Is Higher Than Recent Years and A Win for Buyers – Creating More Buying Power
San Diego’s inventory has climbed from the extreme lows of the pandemic-era market. The extreme inventory shortages that fueled bidding wars earlier in the decade have eased. With more homes on the market, buyers have:
- more homes to choose from
- less bidding pressure
- more negotiating leverage
For buyers who spent 2021–2023 watching homes sell in days for tens of thousands above asking, this shift is significant. In many neighborhoods, competition has cooled, letting buyers shop more strategically. This shift allows for thoughtful decision-making versus the “act fast or lose it” mindset of previous years.
If 2026 continues this trend, early-year buyers could secure homes before spring competition ramps up.
2. Prices Are Stabilizing — and in Some Areas, Softening
San Diego’s home values remain strong, but the days of double-digit price jumps appear behind us for now. Instead of the runaway price appreciation of previous years, 2025 has brought moderation, and we are seeing:
- modest price growth
- flat pricing in some neighborhoods
- increased price reductions on overpriced listings
For buyers, this means:
- better long-term value potential
- fewer bidding wars
- more reasonable pricing
Heading into 2026:
- some markets remain steady
- others have seen slight pullbacks
- overpriced listings are seeing reductions
For buyers, stabilization doesn’t mean dramatic price drops — but it does mean fewer bidding wars and more rational pricing.
This gives strategic shoppers a chance to target well-priced homes and negotiate terms that would have been impossible in ultra-hot markets.
3. Easing Mortgage Rates May Boost Affordability
While no one can guarantee exact rates in 2026, the trajectory favors buyers, and with mortgage rates slowly trending down from earlier peaks, buyers entering the market in 2026 may benefit from:
- improved affordability
- stronger purchasing power
- competitive lending terms
Pre-approval and rate monitoring now can position buyers to act quickly when conditions align.
Buyers should explore updated pre-approvals. Timing can save thousands over the life of a loan — especially if rates continue their modest declines into early 2026.
4. Buyer Preferences Have Shifted — Use It to Your Advantage
Today’s buyers care about:
- flexible home office spaces
- outdoor living
- practical smart home technology
- energy-efficient features
- flexible workspace
- …still demand attention.
Homes that check these boxes may still attract competition.
However, properties lacking trendy updates or amenities may sit longer — increasing negotiation opportunities for value-focused buyers.
5. The Biggest Advantage? Early-Year Timing
Historically, the weeks before spring surge offer:
- less buyer competition
- more motivated sellers
- leftover fall/winter listings open to negotiation
This is especially true in balanced markets like San Diego’s current environment.
If you’re planning to buy in 2026, starting the conversation now — this week — puts you ahead of the seasonal curve.
2026 Could Be a Balanced Market — Not a Frenzied One
When you combine:
- normalized inventory
- stabilized pricing
- and easing rate trends
…the result is a more predictable and rational market environment.
Bottom Line
If you value:
- increased choice
- more negotiating leverage
- and moderated pricing
…2026 may represent a strategic entry point into the San Diego market.
Smart buyers prepare now — before demand heats up again in spring and summer.
For buyers who struggled competing with investors or cash buyers in past years, 2026 may level the playing field.
2026 won’t be a bargain-basement market — San Diego rarely is — but it could be one of the most balanced years we’ve seen in a decade, offering buyers something they haven’t had in years: leverage.
Taking steps now sets you up to capitalize on early 2026 before demand increases in spring and summer.
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