Do You Know How Much Your Home Is Worth?

Home Prices Over the Past 5 Years

Home values in San Marcos have risen substantially over the last five years. During the pandemic boom (2020–2022), buyer demand surged and prices climbed to record highs, followed by a slight dip in 2022 as interest rates jumped. Even after that correction, prices remained about 47% higher at the end of 2022 compared to late 2019. As of late 2024, median home prices are near all-time highs – around the mid-to-upper $900,000s – reflecting roughly a 40–50% increase from five years ago. This long-term growth underscores San Marcos’s strong appreciation trend, outpacing many areas.

Current Appreciation Rates and Market Conditions

Home prices are still appreciating in San Marcos, though the rate varies by data source. In early 2025, the median sale price reached about $980,000 – up a striking 21% year-over-year. (This jump partly reflects a rebound from the 2022 slowdown.) Zillow’s Home Value Index shows a more modest 4.0% annual increase, with the typical home value now around $955,000. Homes are selling relatively quickly: the median time on market is just 25–34 days. Many sellers are still seeing multiple offers, and while the average sale-to-list price is just under 100% (slightly below asking on average), a significant share of homes continue to sell at or above list price in this competitive environment.

Supply and Demand Trends

San Marcos remains a strong seller’s market, driven by limited supply and steady demand. Inventory is very low – for example, there were only about 148 active listings as of January 2025. At the end of 2024, the housing supply was roughly 1.3 to 1.7 months, far below a balanced market’s 5–6 months of supply. This means buyers have few options, intensifying competition. Homes receive around 3 offers on average and often go pending in a month or less. On the demand side, sales activity has picked up from last year – e.g., January home sales were up ~27% year-over-year – as buyers adjust to higher rates and jump on the limited inventory available. Overall, high demand + low supply = continued upward pressure on prices and quick sales.

Factors Influencing Local Home Values

Several key factors are driving home values in San Marcos:

• Limited Housing Supply: A persistent shortage of homes for sale is one of the biggest factors keeping prices high. Many owners are holding onto their homes (especially if they have low mortgage rates), and new construction in North County San Diego hasn’t kept up with population growth. With fewer than 2 months of inventory in late 2024, buyers often compete over the same properties, bidding up values.

• Strong Buyer Demand: San Marcos is a desirable suburban city with good schools, parks, and proximity to job centers in San Diego. Demand is bolstered by the area’s strong economy – San Diego County enjoys robust employment in biotech, education, defense, and tourism sectors – and by families and professionals drawn to the lifestyle. Local market variations also reflect factors like employment trends and the overall appeal of living in San Marcos. Even as higher interest rates dent affordability, many buyers are eager to purchase in this area, keeping demand resilient.

• Interest Rates and Affordability: Rising mortgage rates have cooled buyer affordability somewhat since 2022. Higher rates mean larger monthly payments, which dampens demand at the margins. However, the flip side is that many homeowners are reluctant to sell and give up their low interest loans, which further constrains supply. The net effect is that prices have stayed high – San Marcos’ market has been resilient despite rate increases, as pent-up demand meets scarce inventory. If rates stabilize or fall, buyer activity could increase even more.

• Economic and Policy Factors: Broader economic conditions in California also influence the market. High construction costs and regulatory hurdles limit new home building, contributing to the supply shortage. Meanwhile, San Diego’s continued population and job growth supports housing demand. Even with California’s overall population slowing, this region attracts people for its climate and opportunities. These factors, combined with statewide housing undersupply, have kept San Marcos home values on an upward trajectory.

San Marcos vs. California and U.S. Averages

San Marcos is an above-average cost market, even by California standards. To put it in perspective:

• San Marcos: Typical home value around $955K, with +4% year-over-year appreciation (median sale price near $980K).
• California (Statewide): Average home value about $773K, up 3.1% year-over-year. The state’s median price (Dec 2024) was roughly $729K – meaning San Marcos prices are 20–30% higher than the California median.
• United States (Nationwide): Average home value about $355K, up 2.7% year-over-year. The U.S. median sale price (end of 2024) was around $350K. San Marcos homes cost nearly 3× the national average.

Not only are prices higher, but San Marcos has seen bigger swings than the nation overall. National home price trends have been relatively steady, with gradual growth, whereas San Marcos experienced more pronounced ups and downs in recent years (rapid run-up during 2020–21, a brief dip, then rapid rebound). This highlights how local market dynamics in coastal California can diverge from U.S. averages. That said, both California and San Marcos have outpaced national price gains thanks to chronic housing shortages and strong demand in the Golden State.

Predictions for the Next Year

Looking ahead, experts expect San Marcos home prices to continue rising in 2025, but at a more modest pace. A dramatic surge like the early 2020s is not anticipated, nor is a major price crash on the horizon under current conditions. For the broader region, Zillow forecasts around a +3.6% increase in San Diego County home values in 2025. Similarly, the California Association of Realtors projects the California median price to rise ~4–5% in 2025, reflecting moderate growth. Given San Marcos’ local supply-demand imbalance, it’s likely the city will see low-to-mid single-digit appreciation over the next year as well.

Several factors support this tempered outlook: Mortgage rates remain elevated compared to a few years ago, which could limit how fast prices climb. However, any easing of rates could unleash more buyers into the market. Meanwhile, inventory is expected to stay relatively tight – while more homeowners may list their homes as rates stabilize, it’s unlikely to suddenly flood the market. Buyer demand for North County San Diego remains strong, so even a slight increase in supply may simply make the market a bit more balanced rather than drive prices down. In short, anticipate continued price appreciation but at a slower, healthy rate.

Industry analysts also note that affordability will be a key watch-point. If prices and rates stay high, we may see buyers gravitate toward smaller or more affordable homes (or outlying areas). But as long as San Marcos offers the location and lifestyle buyers seek, and housing inventory stays constrained, home values should hold firm or edge upward through next year. Overall, 2025 is forecast to bring steady but modest growth in the San Marcos housing market – a breather from the frantic gains of the recent past, yet still a positive outlook for homeowners.

Find Out What Your Home is Worth

Home values have climbed significantly, and if you’ve been thinking about selling, now may be a great time to assess your options. Wondering how much equity you have? Let’s connect for a free, customized home equity analysis. Whether you're considering selling or just want to know your home's value, we can provide expert guidance on your next steps. Reach out today!