Judging from September, San Diego real estate once again surged, however the pace of the increase is slowing a bit.
According to The S&P/Case Shiller Home Price Index (Standard & Poor), it indicated that the rise of the index is at 0.9 percent from August to September. This is still a reduction between July to August which posted a 1.8 percent.
The September 2012 to this year’s version rose in the index at 0.9 percent, it’s still below August 2012 to August 2013’s numbers which although it was a decrease from September 2012 and September of this year, the prior annual number peaked at 21.5 percent. In September’s year-over-year gain, San Diego real estate nationally ranks at fourth in the 20-city index, which is a 11.2 percent gain according to the San Diego Union-Times.
“As we head into the fall we should normally see a slowdown in the rate of activity in the housing market, with probably some easing of house price increases, just as a normal seasonal factor,” said Michael Lea, who is a real estate professor at San Diego State University to the San Diego Union-Times.
Lea continued that he found that the higher yearly price gains are due to the number of sales that are still under the standard levels. He also stated that the increase of interest rates adds to the difficulty in being able to afford San Diego real estate, which also puts a strain on prices and brings forth a lower demand.
According to Freddie Mac or known as the Federal Home Loan Mortgage Corporation, the increase is up 3.47 percent from September 2012, while the average for the 30-year-fixed mortgage rate was 4.49 percent.
“Housing continues to emerge from the financial crisis: the proportion of homes in foreclosure is declining and consumers’ balance sheets are strengthening,” said David Blitzer to U-T San Diego, chairman of the index committee at S&P Dow Jones Indices.
“The longer-run question is whether household formation continues to recovery and if home ownership will return to the peak levels seen in 2004.”
The index compares the sale prices that repeat in San Diego single-family real estate. The peak was in November 2005, while in September 2011 it got as high as 193.51.