- Home prices are still higher than they were a year ago, but gains are shrinking at the fastest pace on record, according to S&P Case-Shiller
- Prices in August were 13% higher nationally compared with August 2021
- That is down from a 15.6% annual gain in the previous month
While San Diego homeowners still have a lot to crow about — the value of their houses rose well into the double digits year-over-year — the news is not so sunny month-over-month.
According to the S&P CoreLogic Case-Shiller Home Price Index 20-city composite, San Diego home prices fell nearly another 2.8% in August, up from 2.6% in the red the month prior. The pain is not specific to San Diego: All 20 cities showed declines in August, according to the index.
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Gains around the nation are shrinking at the fastest pace on record since the index was launched in 1987, according to one key metric, as the housing market struggles under sharply higher interest rates, reports CNBC. Prices in August were 13% higher nationally compared with August 2021, down from a 15.6% annual gain in the previous month. That figure closely tracks with San Diego, where the index shows that home prices were up 12.7% year-over-year. The 20-city composite had been up 16% year-over-year in July.
"The forceful deceleration in U.S. housing prices that we noted a month ago continued in our report for August 2022," Craig Lazzara, managing director at S&P DJI, said, in part, in a news release issued on Tuesday. "Price gains decelerated in every one of our 20 cities. These data show clearly that the growth rate of housing prices peaked in the spring of 2022 and has been declining ever since."
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The West Coast, which includes some of the costliest housing markets, saw the largest monthly declines, with San Francisco (-4.3%), Seattle (-3.9%) and San Diego (-2.8%) falling the most. Things were a bit better in Los Angeles, where the month's slide was limited to 2.3%. Somewhat surprisingly, the City By the Bay has been the lowest performing in the 20-city composite since last year, posting a relatively paltry 5.6% gain since August 2021.
It's not hard to figure out where to point a finger: A rise in mortgage rates has made payments as much as 75% higher than a year ago is keeping a lot of houses off the market, since their owners don't want to flip and pay a much bigger monthly nut because of higher rates. And fewer buyers also skew the market south as well, since competitive sellers have to lower prices to attract customers.
