San Diego Home Prices Move Up
home prices
Home prices increase in July.
The Standard & Poor’s/Case-Shiller index reported today that home prices increased in July from June in 17 of the 20 cities tracked.
“This is still a seasonal period of stronger demand for houses, so monthly price increases are expected,” said David M. Blitzer, chairman of Standard & Poor’s index committee. “While we have now seen four consecutive months of generally increasing prices, we do know that we are still far from a sustained recovery.”
Also, eighteen of the 20 cities that the Case-Shiller report analyzed show home prices are still below where they were a year ago. The 10-City composite is down 3.7 percent and the 20-city composite is down 4.1 percent compared to July 2010.
Here in San Diego County home prices rose a tiny0.1 percent in July compared to August, but fell 4.1 percent compared to July 2010.
San Diego Real Estate – A Bottom … Not A Reversal
When the San Diego real estate market hits bottom, it will be just that, a bottom, not a reversal. Don’t believe that home prices will spike up and shoot back up to pre-bust levels any time soon! I find that highly doubtful even if the economy were healthy in other sectors because who is going to fuel this reversal? Will it be the people who have foreclosures and short sales on their credit history, or another group of salivating sub-prime buyers?
Credit is tightening up to the point that home buying is truly back to where you actually have to put 5 to 20% down and have a decent credit rating. That will restrict the pool of available buyers considerably, which will prevent another ridiculous up-ride on the home price roller coaster.
The “bottom” will be the new median home price, according to what the local marketplace and income levels dictate, with modest year to year appreciation.
Until the ‘real’ bottom is reached in the San Diego real estate market, expect many false upward spikes driven by people looking at only one set of data and incorrectly timing the best time to buy.
Related prior posts:
#1 Key To Purchasing Real Estate in the San Diego Market
San Diego California Home Sellers Lose Big
The San Diego California Real Estate Great Depression
Believe the local San Diego ‘experts’ that subprime delinquencies are slowing?
San Diego County Foreclosures up 125% from 2007
Jumbo Financing and the Impact on The San Diego Real Estate Market
Another Look at the June Rise in Pending Home Sales
San Diego Home Prices Increase
San Diego home prices
Today, the S&P/Case Shiller Home Price Index was released for January (index is calculated every month and has a two-month lag). The 20-area index real estate home sale prices report showed declines in 18 of the major metro areas, with just San Diego and Washington, D.C. showing home prices increases.
San Diego Housing Market Bottom?
San Diego housing market
Home prices are still a bubble compared to historic norm. According to Case Shiller index, we are still 20% above long term averages. Typical bottom comes at 20% below average. But this is not your typical recession. This is a deflationary crash. This is Great Depression material. These averages themselves are based on a money supply that was inflated by borrowing for many decades. When the money supply deflates, existing prices and salaries cannot be sustained.
Past generations paid less for housing compared to their income. Whatever you do, do not get into too much debt. If you want to buy, buy cash down or with a large down payment. Even if prices do not fall, in many cases, renting can be cheaper if you consider mortgage interest, property taxes, condo fees, maintenance, lost interest/investment income…
San Diego real estate
San Diego Home Prices Up – Home Sale Down
San Diego home prices
The real estate reporting firm MDA DataQuick, reported today that the San Diego median home prices rose slightly by $500 from October to November to $335,000.
Single-family resale homes rose $1,000, from October to $370,000, which was 1.4 percent above year-ago levels. Resale condos also rose, though the $218,000 November median was down 3.1 percent from November’s $225,000.
That was the good news. The bad news reported in the MDA Dataquick report was that San Diego home sales were down for the fifth straight month in a row! The actual drop was 6.7 percent on a year-over-year basis. This continued drop in San Diego real estate sales is very troubling and for me, and a much more important fact than the modest price appreciation. If this trend continues, it’s just a matter of another month or so before the San Diego median home values also turn down.
San Diego Housing Problem is Getting Worse
San Diego housing market
The number of delinquencies is a dynamic that obviously changes relative to the environment. I apologize for not providing some insight into the hard numbers that your above post requests. Where are we in this process and how much of the problem has already been written off? Is it getting worse, better, or going to be the same and for how long? Read more 