San Diego County monthly home sales fell to their lowest level in at least 35 years to start the year.

The county recorded 1,615 home sales in January, according to Attom Data Solutions. The previous low point, in records going back to 1988, was three years ago, also in January, with 1,624 sales.

January is typically a slow month in the homebuying calendar, but recent data stands out because it comes as mortgage rates have fallen —  something many real estate agents hoped would kick-start the market.

Experts said affordability issues, economic concerns, lack of homes for sale and more are all contributing to a lackluster market.

Mark Goldman, a real estate analyst with C2 Financial Corp., said many potential buyers he spoke to in January were confident mortgage rates and prices would drop in the coming months. Despite a brief dip in rates in February, neither scenario has come to pass.

Even before the Iran war, he said there was still a lot of economic uncertainty related to on-again, off-again tariffs and stubborn inflation keeping costs up.

“People are less inclined to make major purchase decisions,” Goldman said, “when there’s uncertainty in the future about their jobs, concerns about where wages are going to go.”

San Diego County’s median home price rose to $885,000 in January, up 2.2% in a month. The median, which includes single-family homes, condos and townhouses, is the point at which half the homes sold for more and half for less.

Home prices rising while sales fall to historic lows seems counterintuitive but Jan Ryan, a San Diego real estate agent, said it came down to fewer homes for sale to start the year. She said several houses she listed recently have received multiple offers because there wasn’t much else.

“There’s less to choose from,” Ryan said.

There were roughly 4,800 homes listed for sale in January in San Diego County, according to the Redfin Data Center. That’s down from a high of about 7,500 in June.

Ryan said it’s been difficult to get home sellers to understand the market has softened from pandemic highs. She said buyers are more hesitant and she’s seen an increase in contingent offers, where a buyer agrees to purchase a home once their house sells.

“Sellers haven’t caught up with reality,” Ryan said.

It wasn’t just San Diego County, with sales down 7.1% year-over-year, that saw a substantial drop. California home sales were down 7.2% in a year, and U.S. total sales were down 17.6%.

Analysts have warned the Iran war could slow the real estate market further. The average 30-year, fixed-rate mortgage rate was 6.10% in the last week of January, according to Freddie Mac. It dipped below 6% briefly in February, but was up to 6.22% at the end of this week as confidence in the U.S. economy waned in light of the war.

Mortgage rates usually follow the yields on mortgage-backed securities. These bonds typically track the yield on the U.S. 10-year Treasury, often a bellwether of how investors feel about the U.S. economy. A similar scenario took place in mid-January when President Donald Trump threatened to take over Greenland and use tariffs against nations that opposed the plan. Interest rates spiked, but once the plan was seemingly scrapped, rates dropped again.

“If the conflict with Iran is limited, the housing market could rebound quickly,” wrote Lisa Sturtevant, chief economist at Bright MLS, about declining U.S. sales. “However, a prolonged conflict could stall home sales activity this spring.”

San Diego County’s median prices largely followed similar patterns as the rest of Southern California in December. Here’s a look at medians across the region:

Los Angeles County: Down 0.3% monthly to a median of $872,250. Down 0.3% annually.

Orange County: Monthly rise of 2.2% to a median of $1.2 million. Up 1.6% annually.

Riverside County: Monthly drop of 2.9% for a median of $575,000. Down 4.2% annually.

San Bernardino County: Down 2.6% monthly to a median of $515,500. Down 4% annually.

San Diego County: Up 2.2% in a month to a median of $885,000. Up 1.8% annually.

Ventura County: Monthly rise of 1.4% to a median of $850,000. Up 1.8% annually.

Low points in San Diego County home sales

January 2026: 1,615

January 2023: 1,624

December 2023: 1,629

January 2024: 1,670

High points in San Diego County home sales

June 1988: 7,019

June 2004: 6,926

April 2004: 6,751

December 1988: 6,633

Sources: Cotality and Attom Data Solutions