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San Diego Multi Family Updates and Thoughts

After spending 5 years in the electric bike business and running one of the most successful private dealers in the country, I've found it important to stay flexible with expectations. It was difficult to not continue to think that our Covid boom would continue but following trends always helps keep us grounded. As I migrate my career to commercial real estate I try to utilize the same thought process when I look at sales volume vs market demand and contributing factors like price and availability. Here is what we are seeing in the 2-4 unit space (data pulled from the MLS).


2-4 unit sales are still behind compared to 2020, and even if we look back to 2019 we still had 59 sales compared to 2023’s May with 26. We could potentially look at investors saying “this doesn’t pencil” as the sold count drops and price points have changed from $853,645 (2019) to $1,140,769 (2023) on average per sale.


Neighborhood Scout’s report shows the annual San Diego appreciation rate at 5.27%. When we look at the appreciation rate from 2019 to 2023 (21.08% combined) compared to average sale price (2019 to 2023) we see an increase of the average sale price increase to 33.65%. That means price has outpaced inflation by 12.57%.


When it comes to 5+ unit sales (data from CoStar) we are almost in the identical place we were in 2020. It would seem that the market for 5+ has just reset. Pricing hasn’t changed with inflation and we should potentially see this start to see slight growth in regards to average sale price but not in the volume we saw in 2022 (62 sold).


Overall, the numbers below are there to paint a picture of where the market is at. When pricing your property for sale, depending on your urgency, you’d be better suited to price the 2-4 unit property off 2019 comps then add proper inflation. For 5+ you can safely assume the average price point should be compared to May 2020 with moderate inflation increases. When it comes to purchasing it is important to run realistic rent surveys and make sure you aren’t overpaying in a market that is resetting in volume but skyrocketing in price.


See data below for 2-4 units and 5+ units.


MLS Updates 2-4 units


May 2023

  • 26 sold

  • Average days on market - 15

  • Average sale price: $1,140,769

  • Total sold price: $29,660,000 (list $29,244,299)


May 2022

  • 62 sold

  • Average days on market - 27

  • Average sale price: $1,361,496

  • Total sold price: $84,412,763 ($84,899,399)


YTD 2022

  • 321 Sold

  • Average days on market - 21

  • Average sales price: $1,399,855

  • Total sold price: $449,353,486 ($441,858,232)


YTD 2023

  • 175 sold

  • Average days on market - 32

  • Average sales price: $1,298,738

  • Total sold price: $227,279,236 ($230,731,586)


Jump back to 2020


YTD 2020

  • 175 sold

  • Average days on market - 34

  • Average sales price: $941,955

  • Total sold price: $230,779,050


MAY 2020

  • 66 sold

  • Average days on market - 34

  • Average sales price: $961,652

  • Total sold price: $63,469,070

CoStar 5+ Date


May 2023

  • 20 sold

  • Average sales price: $3,256,664

  • Total sold price: $65,133,282


May 2022

  • 48 sold

  • Average sales price: $8,084,996 (127 mil outlier removed)

  • Total sold price: $388,079,817


YTD 2023

  • 103 sold

  • Average sales price: $7,380,988

  • Total sold price: $730,717,782


YTD 2022

  • 184 sold

  • Average sales price: $10,361,318

  • Total sold price: $1,906,482,528


Jump back to 2020:


YTD 2020

  • 119 sold

  • Average sales price: $6,149,618

  • Total sold price: $731,804,600


May 2020

  • 19 sold

  • Average sales price: $3,550,757

  • Total sold price: $67,464,381


Opinions in this article are solely the thoughts of the author. Our blogs are provided on selected topics and should not be relied upon as a complete report of all new changes of local, state, and federal laws affecting property owners and managers. Laws may have changed since this article was published or may have been misinterpreted. Before acting, be sure to receive legal advice or consult a licensed CPA.

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