San Diego's housing market ranked 4th 'most overpriced' in California

SAN DIEGO (FOX 5/KUSI) -- Although the spring homebuying season got off to a slow start, prices remain high in many places across California -- San Diego included. In fact, a recent analysis has ranked it one of the 10 "most overpriced" housing markets in the state for 2024.

Personal finance company Go Banking Rates used data from Zillow and other providers analyzed by Florida Atlantic University's College of Business researchers. The methodology behind the rankings looked at how much of a premium or discount people received in each of the top 100 housing markets in the U.S.

San Diego ranked No. 4 out of the 10 most overpriced housing markets in California with homes going for nearly 24% more than what they should be priced, according to the research.

Currently, the expected value of a home in San Diego is $764,788, but the average home price is listed around $946,976 -- over $182,000 more than what they're worth. Skyrocketing prices are attributed to more homebuyers attracted to the area for its good weather and coastal location.

Modesto topped the list as the "most overpriced" housing market in the state. Homes there are priced nearly 32 percent more than their expected value, according to the analysis. The average price for a home in Modesto is listed at $464,077. However, the expected home value is $351,615.

Other cities on the list were Stockton, Riverside, Bakersfield, Fresno, Sacramento, Oxnard, Los Angeles and San Jose.

Some contributing factors as to why these cities ended up on the list, according to Go Banking Rates, include an influx of people looking for cheaper homes in inland parts of the state as well as severe housing shortages.

Meanwhile, the statewide median home sales price climbed to $854,490 last month, according to a report by the California Association of Realtors. That’s an increase of about six percent from February’s median price of $806,490.

In San Diego County as a whole, the median price of a single-family home sold in March was $1,020,000 compared to $980,000 in February. March’s median sales price was also $100,000 more than the same month last year.