While summer is typically the hottest time of year, both for weather and home selling, it seems this summer failed to warm up in the local real estate market. Home price appreciation continued to lag in San Diego through July and rates have continued to drop since August 2013, however home price appreciation remains in positive territory, which is a promising sign for home owners looking to see gains in home values.
The S&P/Case-Shiller Home Price Index reported on Tuesday, September 30, that home prices in San Diego rose only 8.3 percent from July 2013 to July 2013. This is down from the 10.2 percent annual gain noted in June and indicates a continuation of slower home price appreciation rates. The pace has been slowing in San Diego since August 2013, when a high amount of distressed property activity helped home price appreciation soar to 21.5 percent.
The trend wasn’t just limited to San Diego. The index, which works on a two-month lag time to allow for sufficient data, reported a slowdown in 19 of the 20 cities tracked. Cleveland was the only city to have not slowed down as appreciation rates showed no change. Despite these seemingly stagnant calculations, economists are still hopeful that local markets are well on the way to recovery. Many cities are seeing falling home sales, however these numbers are due to a decreased amount of investor activity on the market. Meanwhile new home and existing home sales are slowly making their way back to normal, healthy rates.
“The broad-based deceleration in home prices continued in the most recent data,” David Blitzer, chair of the Index Committee at S&P Dow Jones, said in a statement to U-T San Diego. “The slower pace of home price appreciation is consistent with most of the other housing data on housing starts and home sales. The rise in August new home sales – which are not covered by the S&P/Case-Shiller indices – is a welcome exception to recent trends.”
San Diego Home Market Remains Strong Despite Slow Summer
While San Diego has seen a slower summer than normal in terms of home price appreciation, conditions are amping up to benefit home buyers in the coming months. The city, along with most of Southern California and other competitive markets throughout the country, has failed to see strong numbers in inventory, a factor that has held back many buyers and kept the market at bay.
“It was kind of an outlier in terms of typical summer activity,” said Mark Goldman, a loan officer and real-estate lecturer at San Diego State University. “We had very low inventory and yet prices were still very soft.”
According to Altos Research, a California-based real estate analytics company, the median single-family home price in San Diego is $639,688 as of September 26. Altos shows a recent drop-off in home prices, indicating that conditions are softening for home buyers trying to get into the area.
We’re a luxury real estate company that specializes in exquisite properties in Southern California. Please contact us today for help finding a great San Diego home today.