The sky will really be falling now.
The S&P Case-Shiller Home Price Index for San Diego dropped from May’s 163.78 to 163.27 in June for seasonally-adjusted numbers, breaking the 13-month streak of slight increases – though the non-seasonally adjusted went up from 163.11 to 163.82. Here is a link to their site.
The S&P’s Dave Blitzer had the standard negative slant on cnbc.com:
“Given the way home sales collapsed in July and given the boost in housing activity across the board in the second quarter, it’s clear this may have been the calm before the storm,” David M. Blitzer, chairman of the index committee at S&P, told CNBC.
S&P, which publishes the indexes, also said home prices nationally rose 4.4 percent in the second quarter after a 2.8 percent drop in the first quarter.
Prices rose in 17 of the 20 metro areas in June, S&P said, adding that in the first half of the year 15 of the 20 areas had positive annual growth rates. The housing market is in better shape than a year ago, S&P said.
“The worry starts when you remember that the Homebuyers’ Tax Credit has expired, foreclosures are still at high levels, and July data on home sales and starts were very, very weak,” Blitzer said in a statement. The inventory of unsold homes and months’ supply data were particularly troubling,” he said, adding that “if this relative weakness in demand continues, it will likely filter through to home prices in coming months.”
Look for September to be cancellation city – sellers aren’t going to put up with this!
The market in san diego appears to be stronger than other parts of CA.The low inventory appears to be the main advantage.I wonder how much environmental and building restrictions limit the supply?
Personally, I feel that it is not the deflation but rather the deflation expectations that are driving this market. We all knew that a 25-50% correction was inevitable given the magnitude of the bubble. Now that the correction has largely happened and the market is still trending down buyers are starting to figure out that it is better to be late than early. I think they also figured out that interest rates are going to be low indefinitely so there is no hurry there either.
I am beginning to understand why people say it is not deflation but rather deflation expectations that you have to worry about and why central bankers are so afraid of the D word.
Uh, sarcasm, really? Look, the prime beach location, weather, etc makes an SD property desirable, yes. And it does help keeping the prices higher.
Perhaps I’m wrong, but in the long haul the inevitable price drop has simply been delayed, not eliminated. Perhaps reviewing prices during the 80s peak to trough in the 90’s could provide some further insight.
Last i saw the population is Increasing. There is a shortage coming.
Dan – assuming population does significantly increase, there are no jobs for them, so how will they afford homes priced well above the average???
population increase itself does nothing good w/o high paying jobs.
ps: CA has the HIGHEST welfare caseload in the country (to be expected relative to population size) AND is the 4th highest percentage of welfare cases per capital (which should NOT be happening because of its sheer size).
In terms of %, CA is behind Maine (small pop with little industry), Rhode Island (same), and D.C. (a well documented mess)….
Think that through to its natural conclusion…
Shortage of water coming, maybe. Land and stupid comments will always be plentiful.
Env and bldg restrictions limit supply? Certainly not in San Diego. The area has been insanely (and regretfully) developer-friendly.
If I had my way, all (ALL) development of >1 homesite would be frozen. Indefinitely. No more eastward sprawl. Want to build a 10 home tract? No problem! Buy a block of ’60s dumps and scrape them…
jack, I’m on to you.
Jack – you really want to freeze development and change the rules in the middle of the game on someone who invested in land, etc based on current zoning/land-use?
How about we ban you from using your vehicle any further because we don’t like the exhaust. Or how about we limit the use of your current residence to only 50% of the SF and 2 residents/unit because we don’t want more residents living here…you’d be pretty tweaked I bet.
Real fun to screw with other peoples money and investments….maybe you’re a politician which would explain it all.
I’m sure you won’t complain when your 401k or pension dives further because of its investments in real estate related securities which you wish to punish.
@ontojacktoo…
I don’t know about Jack, but yeah, I do. Otherwise how do you correct problems? How do you ever put in a highway or otherwise “improve” an area? Sometimes someone’s got to lose. And it’s been me before — CalTrans cut down several hundred trees to widen a highway offramp near us, and then built a sound wall that reflected the traffic noise right at us (which went from an innocuous ssshhhhh sound to a howl). They also chopped a bunch more huge trees that blocked our view of it. Net result = down$$$.
Then there’s the large vacant lot a few doors down from us. They’re in the process of changing the zoning to allow a lot more on it than we bargained for.
We took our losses and moved.