Real Estate & Area News
San Diego Home Prices Still Rising
Home prices in the San Diego area are still on the rise, though the pace of that growth has slowed considerably, according to the latest reading from Standard & Poors and Case-Shiller. Issued Tuesday, the report showed that area values rose 1.8 percent from July to August after surging 2.0 percent between June and July and nearly 3 percent between May and June. Despite the slowdown, however, home prices are up on a year-over-year basis by a staggering 21.5 percent, marking the biggest year-over-year jump in 8 years. Annual price growth in the Southland outpaced the national average of 12.8 percent, and was bigger than the growth seen in all but two of the 20 cities tracked by the S&P/Case-Shiller index.
The recent surge in home values, both across the US and in the San Diego area, have come despite recent increases in mortgage rates. The average rate for a 30 year fixed loan was 4.58 percent in August, the highest it's been since the steepest economic decline in the US since the 1930s. The average 30-year rate has since fallen to 4.13 percent, though that is still well above the levels seen during the recession. Prices, meanwhile, have improved dramatically over the last few years, even reaching pre-recession levels in some markets.
In general, economists believe that rapid home value growth is nearing an end, and that the market will settle down into a more normal trend of annual growth near 3 percent in the coming months. Some areas including San Diego, however, are still experiencing shortages of inventory, meaning that there will still be some upward pressure on prices despite higher interest rates. Of the 20 cities tracked by the S&P/Case-Shiller index, 16 experienced a slowdown in price growth in August. The biggest year-over-year improvement was seen in Las Vegas, where prices rose 29.2 percent, while San Francisco and Los Angeles were the other two cities where prices rose more than in San Diego.
November 5, 2013