In late April, Standard and Poor released the Case-Shiller Home Price Index, which indicated that homes in San Diego are appreciating most significantly throughout the nation. In data tallied from January to February, San Diego is leading the market in price appreciation as the region continues to move out of its annual holiday home buying lull.
The S&P/Case-Shiller Home Price Index is a study that measures home price values in 20 cities throughout the United States. The data lags by two months, but still stands to indicate important factors as metropolitan economies recover from the recession. According to the study, San Diego prices rose 1 percent from January to February. This may not seem like such an impressive number to have appreciated by, but this value was enough to edge out other cities with very strong housing markets like Dallas and San Franscisco. Of the 20 cities studied for the report, 13 marked a decline in home prices from January to February.
In the year-over-year standings, San Diego fell behind San Francisco and Las Vegas in annual appreciation with a 19.9 percent increase from February 2013 to February 2014. This is up remarkably from San Diego’s historical annual appreciation rate of 3 to 3.5 percent, a factor that market watchers attribute to a lack of inventory in this much-desired market.
“There’s a fundamental housing shortage in San Diego County, it’s that simple,” Mark Goldman, a loan officer and real-estate lecturer at San Diego State University, told U-T San Diego. “We have a strong housing market in San Diego as a result of a shortage. We have demand and a robust economy compared to a lot of other communities.”
While San Diego is seeing mild upticks, the other two hot markets indicated by the study came out pretty even in their month-over-month data. Las Vegas saw the highest year-over-year gain with 23.1 percent appreciation and San Francisco followed closely with 22.7 percent appreciation.
A Closer Look at the San Diego Market
While market watchers are looking for the San Diego housing market to slow down any day now, data from Altos Research is showing that the market is actually working toward an evening out period for buyers and sellers. Altos, a California-based real estate analytics company, is reporting that as of May 2, the median single-family home value in San Diego is $625,019. Both the seven-day and 90-day weighted averages are showing that this value is on just a slight increase since a dip during the holidays and around the first of the year. This is consistent with what the Case-Shiller study was suggesting.
A closer look at the buyer and seller trends that Mark Goldman was pointing to indicates that there is an advantage to the seller with a Market Action Index value of 41.32. This value is unique to Altos Research and measures from a neutral point of 30 if the market is trending high into seller’s territory or low into buyer’s territory.
At 41.32, the index is well into seller’s territory indicating high demand and lagging inventory. Looking at the data trends in this category however, the index is actually trending downward to neutral territory from a staggering 63. This means that the market is neutralizing and working its way into healthy territory for both buyers and sellers.
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(all data current as of 10/22/2017)
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