Looking for a market update on the San Diego real estate market? Look no further! In this video, San Diego Realtor Kyle Whissel will take a look at the latest trends in the area and what's driving prices up or down. Whether you're thinking of buying or selling, this video will give you a good idea of what to expect.
What's going on in the San Diego real estate market in November of 2022? I'm Kyle Whissel with Whissel Realty Group and today I want to help you understand what the heck is going on here in San Diego so that you can decide does it make sense to buy to sell, to rent, to invest? What the hell should I be doing in this market? Well, I'm going to share my 20 years of experience and what my econ degree tells me of what's happening in this market so you can make the right decision for you and for your future. So I'm going to shrink myself down. We're going to do this a little bit different today 'cause I want to be able to really share some charts and some graphs to help you understand what's happening in the market today.
So some of the things that we really like to focus on anytime we're looking at statistics is we want to look at what's really happening in the market today so that you can decide what's going to happen in the future. A lot of the data that the media reports is delayed sometimes three, four, five months from what's actually happening because they're looking at closed data, which tends to lag a little bit behind what's happening today. So what we like to look at just from basic economics is supply and demand. So first thing we like to look at is number of new listings.
How many homes came on the market for sale? And you'll see if we look at a year over year comparison we've seen a 26% decrease in the number of homes for sale. But you're going to say that's interesting, why is that? Well, the reason why is that a lot of people aren't selling right now. Big reason is mortgage interest rates have risen significantly. We saw rates early in the year down in the low threes, sometimes even the high twos. And now at the time of this recording, we have rates we've actually just will talk about this in a little bit. Rates dropped quite a bit in the last week but rates we've been seeing for the last couple months in the high six is low sevens.
So the problem is a lot of people are not selling because they don't want to sell and walk away from a rate in the threes and then buy in walking into a rate in the sevens. That just doesn't make a whole lot of sense. It's very expensive when you have a gap like that. So a lot of people just haven't been selling. That's why we've seen 26% decrease in supply. But then we can look at demand, right? How many homes went pending? That means how many homes were listed for sale and accepted and offered. They went pending under contract in escrow.
A variety of different terms that could be used. When we look at those numbers year over year kind of what you'd expect, right? As rates have jumped so significantly you saw that decrease 44%. So both numbers are down, but that demand number is down considerably more than that supply number. So that causes a few things to happen here. I'm going to slide myself over to the side and so what does that cause? Well one that causes the time it takes to sell a home or what we refer to as days on market. That number's up 45.5% from the same time a year ago. And then let's look at the overall effect on supply. That number is jumped up 89% from the same time a year ago. So big, big change right there is a lot more supply of homes for sale. So those of you that were looking at homes six months ago this is a far cry from what you were seeing. Now when you go to look in a neighborhood there's five or six homes for sale as opposed to one home with five or six offers on it. So things have changed quite a bit there.
The other thing that I want to look at and this is where data can be really telling is closed sales. The media reports this number a lot. They look at the number of homes that have actually sold. And then the other number they look at a lot is median sales price. These are lagging indicators. So the data is a bit behind, but the media, right? This is where data can be manipulated a lot because the media could say, oh, median sales price it's up 4% from a year ago. Now that is true, right? They're not wrong. But here's what they're not telling you. Let's cruise up here.
Let's look at this a little bit more in depth is I want to pull up the monthly charts. Now we can really get in here. So let's look at this median sales price number we peaked out. We all kind of agree we're looking at single family home specifically, we peaked out in April. Median sales price in San Diego County at $1 million. But if we look here at October, that's down to 884 that's a decrease of about 12%. So the media a lot of times are going to report maybe the values are up 4% from a year ago or maybe other realtors are bragging, oh values aren't going down, they're up 4% from a year ago. True, but if we just go back six months and look at April to today, they're down like 12%. I've actually seen a 12% pullback from where we peaked out at in April.
So I think that's really important to understand. And now also understand that this is talking about what homes closed out in October. Well what stuff closed out in October? Probably went under contract in like August or September. And I'm shooting this video and this is the most accurate data I have from my Association of Realtors and I'm recording this in the middle of November. So just understand what I'm able to report looking at close numbers is delayed two, three, four months from when these homes actually went under contract. So I believe we actually slid further than 12% if I had to say probably closer to 15% at this point. So it's real important to understand when looking at data to really know what we're looking at. When each time look at close numbers you're looking at old data. So that's why we look at those new numbers that we've showed you which primarily are number of new homes on the market for sale, number of pending homes, homes that have gone off the market. We like to look at days on market how long is it taking to sell and the supply of homes for sale.
All of those are telling us we got some room to go. We're not done going down here we still got some room to go, but for the first time in a long time, we're seeing some light at the end of the tunnel. You probably have heard about this little thing called inflation which is most commonly measured by what is known as CPI, consumer price index. And so here's what happens. The report that came out at the beginning of November is for the numbers that happened in October and for the first time we saw a considerable drop in inflation. And so I want to help you just understand real quick why that is. So these are the last 12 months plus one. So any, the way this works is they look at each month how much did inflation go up month over month. So from September of 21 to October of 21, it went up 0.9%. And then the next month, 0.7, 0.6, 0.6, 0.8, 1.2, 0.3, right? This is the monthly change.
So the number that gets reported which the number that's been reported lately has been in the eights and nines is basically adding up the 12 months worth of change. Well, what this means is every time a new month gets reported, it replaces an old month. So here's why we saw inflation drop considerably with the most recent numbers. Well, the numbers that just got reported for October, if we look at last October we had a nine month over month increase. This October, 0.4 month over month increase. So we just replaced a 0.9 with a 0.4 that dropped inflation by 0.5. If we look at next month we're going to replace a 0.7 and then a 0.6, right? We're going to start replacing some really big numbers. Here's the numbers that we've had in the most recent months.
So if we continue to have numbers, little numbers like this replace big numbers like this you are going to see inflation drop considerably and mortgage rates follow inflation rate. So as inflation starts to pull back, I think you'll see inflation pull back three to 4% by the time we get to right here which doesn't get us to the target the feds want to see us in the two to 3% range. That doesn't get us to two to 3% but it gets us really close to it. So as you start to see inflation pull back more and more and more, you're going to see rates pull back more and more and more.
When rates pull back more and more and more, optimism starts to come back in the market. People who are thinking of selling, they didn't sell because it was too big of a jump in rates. They start getting back in the game, buyers start getting back in the game the market starts to pick up again. So the end of the day, hopefully I didn't go too deep, hopefully I didn't lose you but hopefully understand that there's some light at the end of the tunnel. I think things are going to really start to turn around with rates here in Q4. We're going to start to see it happen. It's going to get a lot better in Q1 and Q2 of next year. And so as that starts to get better, people start getting back in the game. I think the mark starts to turn around and flatten out in Q4 and Q1.
And I think we probably see some increase as we get into Q2 and Q3 of next year. So if you're thinking about buying, buy now, seriously buy now because there's not a lot of competition, there's a lot of inventory, you have a lot of choices. You can get the house you want, the neighborhood you want, the terms you want, the credits, all that stuff. You're going to take a crappy rate. Rates are still in the mid 60s right now. You're going to take a crappy rate but there's going to be an opportunity to refinance in six or 12 months from now as rates get considerably lower. So that could be a really good opportunity 'cause once the rates get lower all the buyers are going to come back, it's going to be competitive again. And that's not a fun market to be in.
So keep that in mind. And then if you're thinking about selling your home depending on what you're going to do, right, there's not a right or wrong answer here. So if you're thinking about selling your home and you are getting out of town or something like that, sell right? We know values are going to decline for the next six months or so. So get out now before the values decline further to minimize your losses. But if you're in a home and you love the home and you don't have somewhere else to go you don't need to go somewhere else, just stay. Just hold on to the home, don't sell.
Unless you really need to go somewhere. I don't think it's the best market to sell in but if you need to go or you planning on going then get out sooner rather than later. Don't wait because values are going to go down. So that's the advice I got for you. I hope this was valuable. If you want to connect with our team, explore things a little further, we can sit down and do a strategy session for you. Whether you're thinking about buying or selling, I'll help you make the right decision for you and your family, give us a call, shoot us a text set that numbered down below. We look forward to connecting with you again Kyle Whistle Whissel Realty Group, we'll talk to you soon.
