San Diego Luxury Real Estate Market Update: $2M–$5M Homes (January 2026)

If you’re keeping an eye on San Diego’s luxury single‑family home market, especially in the sought‑after $2M–$5M price range, the latest data paints a fascinating picture as we enter the new year. With historically low inventory, steady demand, and competitive pricing dynamics, the high‑end segment continues to be one of San Diego County’s most resilient and active markets.

Below is your detailed update—including pricing trends, inventory levels, and what today’s numbers mean for buyers and sellers navigating this competitive sector of San Diego real estate.

Pricing Trends: Luxury Homes Continue to Command Strong Offers

Since 2023, homes in the $2M–$5M range have consistently sold between 93% and 100% of their original list price, signaling sustained buyer demand—even as interest rates and broader economic conditions shift.

In December, we saw a notable uptick, with luxury homes closing at an average of 95.6% of their original asking price. This suggests two key factors:

• Buyers are still willing to pay close to list price for well‑positioned luxury properties.
• Sellers who price accurately based on neighborhood trends and property condition continue to capture strong results.

For anyone considering entering this market, pricing strategy remains crucial—whether you’re competing for a desirable listing or preparing your property to maximize visibility and offers.

Inventory Tightens: San Diego Hits a Multi‑Year Low

One of the most striking developments in today’s luxury market is the severe shortage of new listings. As of December, the months of supply for $2M–$5M homes dropped to 1.94 months, marking the lowest level in over three years.

What does this mean?

In real estate, anything below 4 months of supply is considered a seller’s market. At fewer than 2 months, San Diego’s luxury sector is operating with intense scarcity—an environment where:

• High‑quality homes sell quickly
• Competition increases for premium locations
• Buyers benefit from having a clear strategy and quick decision‑making
• Sellers benefit from reduced competition and a steady flow of qualified buyers

This tightening trend is reinforced by the dramatically low new‑listing counts over the past six months.

New Listings Drop Sharply: December Hits a Two‑Year Low

Here’s how new listings have trended in San Diego County’s $2M–$5M bracket:

The decline from 205 new listings in July to just 72 in December represents a massive slowdown in fresh inventory, compressing buyer options during a time when demand typically remains steady.

For homeowners considering selling in early 2026, this is a strategic moment—reduced competition can dramatically enhance visibility and negotiating power.

Active Inventory Snapshot (January 1): Another Decline

As of January 1, San Diego County currently has 383 active homes priced between $2M and $5M—a 7% decrease from last month’s snapshot.

With fewer than 400 active properties across the entire county in this range, buyers now face one of the most limited luxury inventories in recent years. This scarcity often leads to:

• Faster decision timelines
• Increased importance of pre‑approval and financial readiness
• Heightened reliance on agent expertise to identify off‑market or soon‑listed opportunities

What This Means for Buyers

If you’re shopping for a luxury home in San Diego:

• Expect competition, especially for move‑in‑ready homes in coastal and central neighborhoods.
• Be prepared to tour quickly—desirable homes don’t sit long.
• Have your financing positioned and verified to strengthen your offer.
• Work with an agent who can access “coming soon” or private listings to broaden your options beyond what’s publicly available.

What This Means for Sellers

If you’re considering selling your luxury home:

• You’re in one of the strongest seller environments we’ve seen in years.
• Low inventory means you face less competition and can capture more attention.
• Proper pricing, strategic marketing, and presentation still matter—but the market is working in your favor.
• Early‑year listings tend to perform well before spring inventory increases.

Ready to Explore the San Diego Luxury Market?

With hundreds of active listings and new opportunities emerging each week, there’s never been a better time to discuss your goals—whether you’re buying, selling, or simply keeping an eye on trends in the $2M–$5M segment.

If you’d like to see any of the currently available properties or want a tailored market analysis for your neighborhood, reach out anytime. We can refine your search parameters, identify the best opportunities, and build a gameplan aligned with your real estate goals.