San Diego Real Estate Market Forecast 2025: It’s A Rental Market, & Learn About Buyer Interests
As we look ahead to 2025, San Diego’s real estate market shows no signs of slowing down. The city's dynamic economy, coastal allure, and limited inventory continue to make it one of the most competitive markets in the U.S. Whether you're buying your first home, investing in rental properties, or planning to sell, understanding the upcoming trends will be crucial to making the best decisions. Here's a look at what to expect in 2025.
Rising Property Prices

Home prices in San Diego are projected to continue rising in 2025, driven by a combination of high demand and low supply. The median home price in the city is expected to increase by approximately 6-8% year-over-year, keeping it firmly in seller's market territory. Coastal areas like La Jolla and Del Mar remain among the priciest, but neighborhoods like Chula Vista and Oceanside still offer relatively affordable options compared to the city's central locations.
One notable area to watch is the up-and-coming neighborhood of
East Village
in downtown San Diego. This area is seeing a surge in development, with new residential projects transforming it into a vibrant urban hub. For investors looking for long-term growth,
East Village
could provide significant opportunities as the area continues to evolve.
Shift In Buyer Preferences
In 2025, we expect to see a continued shift in buyer preferences, particularly toward more space and flexibility. The rise of remote work has caused many buyers to seek homes with dedicated office spaces and larger yards, pushing demand toward suburban areas like Carmel Valley and Poway, where families can find more room without sacrificing proximity to the city’s amenities.
Additionally, energy-efficient homes and sustainable living features will become increasingly important to buyers. Expect a growing demand for properties equipped with solar panels, smart home technology, and eco-friendly upgrades, which not only offer lower utility costs but also align with San Diego’s environmentally conscious culture.
Opportunities in Rental Investments

The rental market in San Diego will remain strong in 2025, bolstered by a steady influx of residents moving to the area for its thriving job market and unbeatable lifestyle. For property investors, this means continued opportunities for growth, particularly in neighborhoods like Normal Heights and University Heights, which have strong rental demand due to their central locations and community vibes.
San Diego’s military presence also creates a consistent need for rental properties, particularly near
Camp Pendleton and
Naval Base San Diego. Investors looking for reliable, long-term tenants may find success in these areas, where military families often seek housing.
Economic Factors Driving San Diego’s Real Estate Market
Several key economic drivers will continue to shape San Diego’s real estate landscape in 2025. The city's biotech industry, along with defense and technology sectors, remains a powerful engine for job growth, attracting skilled professionals from across the country. Tourism is also expected to rebound strongly, increasing demand for vacation homes and short-term rental properties, particularly along the coast.
Additionally, San Diego’s commitment to infrastructure improvements, such as transit expansion and housing initiatives, will play a significant role in shaping the future of the market. These efforts are aimed at alleviating the housing shortage and
making the city more accessible to both residents and investors alike.
Tips for Buyers & Sellers

For buyers navigating the competitive 2025 market, it’s essential to stay prepared. Work with an experienced real estate agent who understands the local market and can help you act quickly on new listings. Getting pre-approved for a mortgage will give you an edge in multiple-offer situations, and being flexible with contingencies could make your offer more attractive.
Sellers, on the other hand, can benefit from the strong demand and rising prices, but that doesn’t mean it’s time to sit back. With buyers becoming more discerning, especially in terms of home condition and energy efficiency, investing in strategic upgrades before listing your property could yield higher returns.
Working With A San Diego’s Real Estate Expert

At Carroll Realty, we understand that real estate decisions are some of the most significant investments you’ll make. Whether you’re buying your first home, selling a property you’ve had for a long time, or expanding your investment portfolio, we’re here to provide expert guidance tailored to your goals. With over 30 years of experience in San Diego’s real estate market, our team is dedicated to helping you navigate the trends and make informed decisions for your future.
2025 is shaping up to be another exciting year for San Diego real estate—let us help you make the most of it.
Contact us today to discuss your real estate goals and see how we can help you succeed in this highly competitive market

