Consider investigating the city’s vast array of condos; many combine the best of city life with beach access.
A Beginner's Guide to Buying a Home in San Diego
Mark James | Relationship Manager
First Republic Bank
3 min read
Visit San Diego and it’s easy to understand the appeal of buying a home in this coastal Southern California city. The lifestyle is laid back, the beaches are stunning, and the city offers everything from a vibrant craft beer and food scene to a burgeoning startup community.
Aspiring transplants should, however, do some advance research to ensure they’re positioned to make the most of the city’s unique real estate market — from the impact of ocean views on property prices to the unexpected challenges associated with drought-resistant landscaping.
Pay attention to the following guidelines and in no time, you could be calling San Diego home.
It’s all about the ocean
The median home price in the city of San Diego recently reached $625,759, while the county’s overall median price topped $585,000, though some areas have reached beyond that high watermark.
As with all cities, prices vary by neighborhood. And potential homebuyers should understand the huge impact of a key factor on the local real estate market: the ocean. Zillow reports that the median value of waterfront homes across the country is more than double the median value of all homes. Proximity to a beach can make a neighborhood more costly, and having even a small view of the ocean increases home prices.
It’s no surprise then that neighborhoods and communities west of the I-5 highway and closer to the Pacific are more desirable. Some areas north of the city (such as La Jolla and Del Mar), as well as neighborhoods within the city itself (such as Little Italy and Point Loma), are just a short distance from the water — and homebuyers pay for that access.
California dreaming, urban living
Do you yearn for a walkable urban experience that will allow you to live, work and play in the same neighborhood? If so, consider investigating the city’s vast array of condos; many combine the best of city life with beach access.
If you’re new to the state, there are other aspects of buying a home in California that are important to consider. For example, property taxes can vary by city and county and, depending on location, may add significant costs to your mortgage. The property taxes in most areas average about 1 percent of the property’s total price.
In addition, homebuyers who dream of a great expanse of green grass may be in for surprise. Like many other California cities, San Diego prioritizes water conservation due to the state’s ongoing drought. This has led to various water-use restrictions, such as allowing the watering of your lawn only on certain days of the week or, in more severe situations, not allowing it at all — something to consider if you’re buying a property with large yards. Many San Diego homeowners have begun “going brown” by replacing their lawns with stone or gravel to aid with water conservation.
A (mostly) seller’s market
San Diego’s housing inventory remains near historic lows. There are often multiple offers on homes, driving up prices and making it harder for first-time homebuyers to find properties in their budget range. That said, demand does vary by area and can change with buyer trends.
For example, Rancho Santa Fe is a community in northern San Diego County, known for its expansive multimillion-dollar properties. As buyers lean away from homes with large square footage, however, many of the dozens of homes currently for sale in the area have been on the market for months — potentially presenting a great deal for the right buyer.
Regardless of which San Diego neighborhood you ultimately favor, you’ll want to be as prepared as possible before you begin making offers. Talk to your lender about which mortgage options are best for you and how soon you’ll be able to close, as a shorter timeline can often provide an edge over other buyers. If you’re selling another home before you buy, investigate loans that can help you avoid contingency offers, which are usually less desirable to sellers.
Moving to San Diego can be your California dream come true. Figure out what makes this unique real estate market tick, and you’ll be on track for a move that could increase your beach time and enrich your life.
The strategies mentioned in this article may have tax and legal consequences; therefore, you should consult your own attorneys and/or tax advisors to understand the tax and legal consequences of any strategies mentioned in this document. First Republic does not provide tax or legal advice. We make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained here. This information is governed by our Terms and Conditions of Use.