San Diego County – Multifamily Trends Report – September 2023

Enclosed is the Market Trends Report for September 2023, showing 10 years’ worth of sales metrics for San Diego County Multifamily. We’re hitting the third quarter of consecutive, historically low Sales Volume at $396-$404M for Q1-2023-Q2-2023 and $380M to-date for Q3-2023.

To put the trends in perspective, Q2 2020 was at $377M in volume and Q3 2020 at $344M volume during the pandemic. We thought it would be interesting to overlay and compare San Diego Multifamily Transaction Volume, San Diego Residential Sales Volume, 10 Year Interest Rates and U.S. Inflation rates in the chart below and displayed over the past 10 years. The chart shows strong correlations between both inflation and interest rate increases combined with a decline in overall market volume for both residential and multifamily transactions in San Diego County.



Below you’ll find a chart for sales volume with the price per unit overlay for San Diego County Multifamily. You’ll notice that most, if not all, low volume quarters were tied to interest rate/inflationary concerns in the marketplace. See below for a brief historical summary of Q1 2018, Q1 2017 and Q3 2013.



Looking back to Q1 2018 when San Diego Multifamily volume was $298M; global equity markets declined with investors concerned about US interest rate increases and worries over trade. Global bond markets reflected higher inflation. The Nasdaq Composite lost 3.9% in 2018, its worse year in a decade, the S&P 500 (fell by 9%) and the Dow fell for this first time in three years, the Nasdaq broke its 6-year rise. Tightened monetary policy, slowing economy, and the trade war between the U.S. and China all contributed towards volatility in the market.

Q1 2017 was another low of $301M for San Diego Multifamily volume. The global markets started slow, yet 2017 ended up being a historic year for Wall Street with the Dow Jones topping 20,000 for the first time. The Fed raised the fed funds rate for the third time in a decade in response to strengthening inflation pressure. At this time the UK was advancing towards Brexit adding volatility concerns. Consumer sentiment declined 98.5 to 96.9 in this quarter, though well above average of 86.0. Inflation was a primary concern back in Q1 2017, with the CPI increasing 2.7% in a year and cautious consumer spending in the beginning of 2017. With unemployment rates decreasing and hiring increasing along with inflation increasing, the Fed raised interest rates a widely expected 0.25 with the Fed future targeted rate hikes of 0.75-1.00%.

And finally, in Q3 2013, every major asset class and index underperformed in US equities. Janet Yellen was nominated as the head of the Federal Reserve, the market predicted this appointment would equate to longer than expected period of low rates. During this quarter, the unemployment rate declined to 7.3%, mostly due the contraction in the labor force. Inflation wasn’t a factor or concern in this quarter. Consumer confidence dropped significantly in August and September, mostly due to the rise in mortgage rates. China’s lagging performance in the country’s annualized GDP growth of 7.5%, close to its post-recession low of 6.6%, the region sensitive to the US monetary policy and concerns about the tapering that occurred during the third quarter had effect in Asia-Pacific regions economies and markets. Employment had negative indicators in Q3 2013. The Fed opted not to scale back on it’s quantitative easing program. At this point, economic forecasters where believing employment gains would be low if not flat the remainder of the year. Despite speculation of the Fed Tapering its quantitative easing program, the central bank announced the following September, it would maintain its monthly program of buying $45B of Treasury securities and $40B of mortgage-back securities. Also, we had the government shutdown in the background. 10-Year treasuries rose in July, August and first half of September from 2.52% to a high of 3%. The Muni bond market was also impacted by Detroit bankruptcy and concerns about Puerto Rico bankruptcy, in which the Fed stepped in and in 2016 passed the Puerto Rico Oversight, Management and Economic Stability Act (PROMESA), which helped restructure Puerto Rico’s debt and pension liabilities totaling over $130B.


Read more San Diego Multifamily specific trends in the report below.


San Diego Multifamily Trends Report – click to download.

Please contact us if we can assist you with anything.

Eric von Bluecher
Principal | Multifamily Investments
Lee & Associates | North San Diego County
D  760.929.7846
O  760.929.9700 

Ivan Del Muro-Garcia
Lee & Associates | North San Diego County
D  760.448.2451
O  760.929.9700

Connor Macomber
Junior Associate
Lee & Associates | North San Diego County
D  760.448.1371


San Diego Multifamily Investments
Corporate ID 01096996 | License ID 01926201
1902 Wright Place | Suite 180
Carlsbad, CA 92008


1902 Wright Place, Suite 180
Carlsbad, CA 92008, USA

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