Short answer: Yes: current trends point to San Diego home prices rising again in 2026, especially in central neighborhoods like North Park, South Park, University Heights, and Golden Hill. Low inventory, steady demand, and limited new construction continue to push values upward as buyers compete for well-located homes.
Will San Diego Home Prices Rise in 2026?
- Inventory remains well below historical norms.
- Central San Diego neighborhoods continue outperforming the broader market.
- Demand from move-up buyers and out-of-area relocations remains steady.
- New construction isn’t keeping pace with population growth.
- Moderate appreciation is more likely than sharp spikes or declines.
Expanded Explanation
San Diego enters 2026 with a housing market shaped by years of inventory shortages and sustained demand. While the pandemic surge is behind us, the structural imbalance between supply and demand remains. Buyers continue to prioritize urban, walkable neighborhoods such as North Park, South Park, University Heights, and Golden Hill. These areas offer historic charm, local amenities, and proximity to employment locations. These are factors that consistently protect and enhance property values.
Across Greater San Diego, new construction is limited and often concentrated outside central neighborhoods. Meanwhile, zoning restrictions and geographic constraints keep buildable land scarce. As a result, even when buyer demand softens slightly, prices in the core neighborhoods hold steady and often rise. This trend is expected to continue into 2026 as more buyers target lifestyle-focused communities with strong long-term appreciation potential.
Mortgage rates may shift throughout the year, but San Diego’s buyer pool remains resilient. Many would-be sellers who locked in low rates are holding their properties, which keeps resale inventory constrained. This is especially noticeable in North Park and University Heights, where turnover is already lower than the city average. For homeowners, these conditions typically support gradual appreciation. For buyers, it means acting decisively when the right home becomes available.
Misconceptions / Insights
One common misconception is that rising rates will automatically push prices down. In San Diego’s central neighborhoods, this rarely holds true. Demand consistently outpaces supply, and buyers value convenience and community over waiting for uncertain market shifts. Another misconception is that appreciation will mirror the rapid growth seen in prior years. The 2026 outlook suggests steady, controlled growth rather than dramatic spikes.
Important Considerations
Buyers should prepare for competitive conditions, particularly for renovated homes or properties with ADU potential for multi-generational living. Sellers should recognize the advantage of listing in neighborhoods where demand is strongest. Homeowners considering equity moves in 2026 will benefit from continued appreciation, but timing, pricing strategy, and property condition will influence results in a more balanced market. Buyers prioritize a walkable neighborhood with access to restaurants, parks, and local businesses.
Sellers in North Park should price strategically as buyer competition remains strong despite rate fluctuations. Request a free home valuation to understand your equity position before making 2026 plans
FAQ
Are San Diego home prices expected to rise in 2026?
Most indicators suggest moderate price growth driven by low inventory and sustained demand in key neighborhoods.
Which neighborhoods will likely appreciate the fastest?
North Park, South Park, University Heights, and Golden Hill continue to show strong appreciation patterns.
Is 2026 a good year to buy?
For long-term owners, yes. Stable demand and limited inventory support consistent value growth.
Will mortgage rates affect pricing?
Rates may influence competition, but are unlikely to reverse long-term upward pressure in central San Diego.
Next Steps
Get a clear picture of your property’s current market position: Request Your Free San Diego home valuation.