April increase nearly nation’s worst and far off last year’s sizable leap
Annual home price gains in the San Diego metropolitan area were below 1 percent for the first time since 2012, said the S&P CoreLogic Case-Shiller Indices released Tuesday.
San Diego metro home prices were up 0.8 percent in a year — a major change from one year ago when the market had seen a 7.8 percent annual increase.
April’s numbers reflect slowing price appreciation across the nation, which experts generally attribute to affordability issues after years of home costs outpacing wages. Nationally, home prices were up 3.5 percent with low-cost markets showing the biggest gains.
Matthew Speakman, an economist at Zillow, wrote in an analysis that it is likely that prices will continue to rise, but not at unsustainable levels seen in the most recent years.
“Despite persistently low mortgage interest rates,” he wrote, “affordability is top of mind for many buyers strained by prices that have grown much faster than incomes over the past several years and an ongoing dearth of supply that is keeping competition high.”
San Diego had the lowest price gain of the 20-city index, but Seattle had no price gain. Other slowed markets were Los Angeles, up 1.5 percent in a year, and San Francisco, up 1.8 percent in a year.
Las Vegas had the biggest gain of the index at 7.1 percent. It was followed by Phoenix at 6 percent and Tampa, Fla., at 5.6 percent.
The indices evaluate home prices by more than just price, tracking repeat sales of identical single-family houses as they turn over through the years. Prices are adjusted for seasonal swings. The median home price for a resale home in April was $630,000, said CoreLogic.
For potential buyers, April had more favorable conditions for borrowing. Freddie Mac said the average interest rate for a 30-year, fixed-rate mortgage was 4.14 percent in April. That’s down from 4.47 in April 2018, but up from 4.05 percent in April 2017.
Analysts were somewhat split on where the home market might go next.
Philip Murphy, a managing director at the S&P Dow Jones Indices, wrote in the Case-Shiller report that it is possible the housing market has returned to a more normal rate of appreciation.
“The national supply of housing is trending upward and suggesting weaker demand,” he wrote. “Perhaps the trend for the moment is toward normalization around the real long run average annual price increase.”
Ralph McLaughlin, deputy chief economist at Core- Logic, said there were signs the market was rebounding somewhat from March to April.
“This suggests the great cool down of 2018-2019 might be coming to an end,” he wrote in an e-mail. “Coupled with mortgage rates falling to 18-month lows, it seems the housing market frost is poised to thaw quickly this summer.”
S&P CoreLogic Case-Shiller for April 2019
Yearly increase by metropolitan area:
Las Vegas: 7.1 percent
Phoenix: 6 percent
Tampa, Fla: 5.6 percent
Atlanta: 4.9 percent
Charlotte, N.C.: 4.2 percent
Boston: 3.9 percent
Miami: 3.9 percent
Denver: 3.8 percent
Cleveland: 3.5 percent
Detroit: 3.5 percent
Minneapolis: 3 percent
Dallas: 2.7 percent
Portland, Ore: 2.6 percent
Washington, D.C.: 2.6 percent
New York: 2.1 percent
Chicago: 1.9 percent
San Francisco: 1.8 percent
Los Angeles: 1.5 percent
San Diego: 0.8 percent
Seattle: 0 percent
National: 3.5 percent
San Diego Union-Tribune