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2021–2022 Market
Low cap rates / peak pricing
2023–2024 Adjustment
Rate shock / repricing
2025–2026 Market
Stabilized pricing / disciplined buyers
What's Happening in the San Diego Apartment Market Right Now?
The market has shifted — but not in the way most headlines suggest.
Buyer demand is still strong
Transactions are still happening
But pricing is now constrained by financing
Cap rates, debt costs, and underwriting discipline — not fear — are driving today's values.
San Diego Multifamily Sales Activity (2026)
~70+
Closed Transactions
$770M+
Total Volume
5–10
Median Deal Size (Units)
120–160
Avg Days on Market
How Buyers Are Pricing Deals Today
Target yields: 5.5%–6.0%
Strong focus on DSCR — lenders requiring higher yield cushions
More conservative rent assumptions — no more aggressive pro forma projections
Heavy scrutiny on expenses — buyers correct for underreported costs immediately
Today's buyers are not overpaying — they are underwriting to survive current debt conditions.
Understanding how buyers underwrite is critical for sellers pricing their property. See current San Diego apartment cap rates for detailed breakdowns.
Why Many Apartment Deals Fall Out of Escrow
Rate changes during escrow — financing terms shift mid-deal
Expense corrections — buyers find underreported costs during due diligence
Unrealistic seller expectations — pricing based on peak-market comps
Lender constraints — DSCR requirements tighten during underwriting
The Biggest Disconnect in Today's Market
This is where pricing adjustments happen. Sellers who price based on 2022 comps face longer time on market, failed escrows, and ultimately lower sale prices. Working with a specialized apartment broker who understands current buyer underwriting prevents these failures.
Recent Sales Snapshot
6 Units
$2,500,000
5.36% cap
Normal Heights
9 Units
$2,900,000
2.1% actual / 9%+ pro forma
North Park
8 Units
$2,200,000
5.81% cap
City Heights
Browse all recent apartment sales for full transaction details across every San Diego submarket.
What This Means for Apartment Owners
Values are stable — but more selective. Not every property gets the same pricing.
Well-positioned deals still sell quickly. Correct pricing + right buyer targeting = fast close.
Pricing mistakes get exposed immediately. Overpriced properties sit and become stale.
Buyers are prioritizing risk-adjusted returns. In-place income matters more than projected upside.
If you're considering selling, the most important step is understanding how buyers are underwriting your specific property — not just looking at countywide averages.