How is the Real Estate market these days?

Question

I am seeing many homes reducing the listing prices in San Diego and other areas. San Diego has been difficult to find good cashflow positive properties even with 30% down payments. Want to see if I can find some good deals if there is a downturn.

1. What do the RE experts think, the market would be in next 6 to 12 months?
2. If San Diego home prices does not decrease as much as other surrounding areas, any suggestions about Temecula, Murrieta, Riverside, Palm springs or other places around San Bernadino county for good investments?

Scott Scoville · Answer

Seeing price reductions everywhere. I'm in Sacramento, and it's buying season for me and my investor clients. So many great deals. We're locking up properties well below market with credits at close. Once rates start coming down, it's going to get more competitive, as more buyers will flood the market that have been sitting on the sideline. Unfortunately sellers have so much equity, I don't see the market tanking. It's not like 08-09. Ultimately, buy good deals in good locations and hold long term. Best of luck in SD, it's a great city!

Dan H. · Answer

I do not try to predict prices in the near term and since 2021 have been doing my underwriting at 0% appreciation for first 5 years and 3% year 6 onwards. What I suspect is it will be near my forecast (0%), but in the short term anything can happen.

Palm Springs area is already expensive for a p,ace that is unbearable to live for 4 to 5 months of the year.   The rest are priced correct for their distance from urban centers.   By the way have you been to San Bernardino in the summer.   Worse air quality by far than la and San Diego.

The rate increases have made the market challenging.   Some thoughts: patience, network, value adds, alternative financing, etc.    do not purchase just to purchase.   Residential RE is not passive; do not pay to have work and risk. Make sure the return justifies the effort and risk; this will not be easy in this market.

Good luck

Joey Banasihan · Answer

Hey @Gash Nookala, great questions — and welcome to the rollercoaster of West Coast investing!

You’re definitely not alone. Across the West Coast, especially in markets like San Diego, it’s tough to find cash-flowing single-family homes right now with these rates, even with sizable down payments. In some cases, small multifamily properties (duplexes, triplexes) are giving people a shot at breaking even or getting close—but the margins are still thin unless you're bringing a big chunk of cash or doing value-add work.

Real estate is always hyper-local, and while pricing trends in San Diego might feel stagnant, places like Temecula or Murrieta could offer a little more breathing room if you're open to heavy due diligence and hands-on investing. Some of those areas are shifting a bit quicker, especially where inventory is creeping up.

That said, a lot of folks I work with are shifting their focus to out-of-state BRRRRs—using equity to grow their portfolio and play the long game. Boise, for example, continues to perform well for investors—stable rent demand, solid population growth, and we’re starting to see price softening in some pockets, which opens the door for creative or value-add plays.

Curious—when you mention cash flow, is it more about covering expenses fully, or building up reserves and options to scale? That answer alone can shape the strategy. Happy to share how others are navigating that shift.

Ben Howard · Answer

As per usual, the answer depends on the specific market. Looking at how many offers were received on pending inventory is an indicator that I like to track. For example, while many agents will tell you that it's a buyer's market, there may be multiple offers on homes which have accepted an offer. In Folsom, CA 13 homes accepted an offer over the past seven days and 9 of those 13 homes received multiple offers and only 4 of those 9 had price reductions. So, if a buyer had gone in with a strategy of a below listing price offer with buyer friendly terms, they may not have had their offer accepted.

Also, if inspections were provided prior to offer acceptance and then the buyer wants a credit or price reduction during escrow, the seller may tell them no (information which the buyer should have known when they made their offer) as they may have one or more backup offers to choose from. The days on market for the 13 homes which accepted offers over the past seven days is only 21 days while the days on market for all active Folsom inventory is 42. Homes which are priced right from the start or receive a price reduction shortly after are moving faster.

I used to post Altos Research market data to Bigger Pockets for specific cities, as it's more timely than the Trendgraphix data that agents in the Sacramento area have access to via our MLS and I thought it helped our community. However, I was told by a BP admin that I can't post this Altos data because it has my contact information on it. I will tell you that today's Altos Research report has Folsom shifting significantly from the verge of a buyer's market last month to much more of a seller's market today. This reflects what I stated when I provided the multiple offer numbers for Folsom.

When soliciting an opinion of the market it helps to ask your agent for the most recent data. In the Sacramento area, generally the best time to be a buyer is October through early January.

Ned Carey · Answer

The market is always good for somebody. Sometimes it is good for seller, sometimes it is good for buyer and sometimes it is good for operators and dealmakers.

Regardless of how the "market" is, there are always good deals to be had. sometimes they are just harder to find.

Gash Nookala · Answer

Thanks for the reply. Yes, looks very realistic to plan for 0% appreciation for few years and then have modest expectations.

How is the Real Estate market these days?

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