For the first time in 2022, San Diego home prices slipped in their march toward higher prices.
That, based on the latest report from the S&P CoreLogic Case-Shiller Index, which is crafted drawing on figures collected at the closing of April.
While the slowing was not significant — yes, the average home in America's Finest City increased 28.5% in value compared with a year earlier, as opposed to the previous month, when the same home was up 29.6% year-over-year — the figure may still be a harbinger of things to come. After all, April 30 was an eternity ago in financial years. The Dow was still rocking well above 30K, for one thing; 32,977.21, to be exact. On Thursday when the markets closed, it had dropped nearly another 254 points, down to 30,775.43.
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Craig J. Lazzara, managing director at S&P Dow Jones Indices, said in a news release that the sun may be setting on the wallet-bursting bubble that homeowners have enjoyed recently.
"April 2022 showed initial (although inconsistent) signs of a deceleration in the growth rate of U.S. home prices,” Lazzara said in a statement released on Tuesday, adding later, “We noted last month that mortgage financing has become more expensive as the Federal Reserve ratchets up interest rates, a process that had only just begun when April data were gathered. A more-challenging macroeconomic environment may not support extraordinary home price growth for much longer.”
Between April 2022 kicking off and its sunset, San Diego homes appreciated 2.3% in value, a dip from the much more robust 3.7% that the index reported the month prior. Those figures are paralleled, approximately, for our neighbors to the north in Los Angeles, where homes jumped 2% in value in April, as opposed to the 3.3% spike in March.
These trends echo the national 20-city composite figures in the index, which showed a month-to-month increase of 2.3% in April.
The news was not all cloudy — homes in every city in the Top 20 continued to post annual prices gains, none more so than in the three hottest markets in the U.S. in April, which were in Florida — Tampa and Miami — and Arizona (Phoenix).
“Tampa (+35.8%) was the fastest growing city for the second consecutive month, with Miami (+33.3%) and long-time leader Phoenix (+31.3%) in second and third positions," according to the S&P DJI news release.
So as an investor, your choices are Florida (too humid), Phoenix (too Arizona) or San Diego. Many readers will probably opt for sluggish San Diego and its 28.5% year-over-year gains.