Rental trends in Bay Terraces have shown stability in the percentage of renter-occupied homes, ranging from 36% to 38% between 2013 and 2022. However, average rent prices have steadily increased over this period. In 2013, the average rent was $1,628, which rose to $1,750 by 2022, a 7.5% increase. Notably, there was a significant spike in average rent to $1,963 in 2021, before decreasing in 2022. This spike coincided with a slight population decrease from 33,462 in 2020 to 31,944 in 2021, which may have contributed to the temporary rent increase.

In 2023 and 2024, Bay Terraces continued to experience growth in average home prices. The average home price reached $688,310 in 2023 and further increased to $747,309 in 2024, representing an 8.6% year-over-year increase. This growth occurred despite rising interest rates, which reached 5.02% in 2023 and 5.33% in 2024, indicating strong demand for housing in the area.

Based on historical trends and current market conditions, average home prices in Bay Terraces are expected to continue their upward trajectory over the next five years. Assuming a conservative annual growth rate of 5%, average home prices could potentially reach around $953,000 by 2029. For average rent prices, considering a modest annual increase of 3%, we might see average rents climb to approximately $2,030 by 2029.

In conclusion, Bay Terraces has demonstrated remarkable resilience in its homeownership rates despite significant increases in average home prices. The neighborhood has maintained a stable balance between owner-occupied and renter-occupied homes, even as both average home prices and average rent prices have risen. The continued growth in housing values, even in the face of rising interest rates, suggests strong ongoing demand for homes in this San Diego neighborhood.