Home prices in San Diego grew 0.6 percent in July, picking up the pace after a slowdown in June, but an official at the widely-followed Case-Shiller index downplayed any concerns about a bubble.
David Blitzer, managing director of S&P Dow Jones Indices, said Tuesday the 5 percent annual growth shown in the latest Case-Shiller report is “probably not sustainable over the long term,” but “there is no reason to fear that another massive collapse is around the corner.”
The price rise in San Diego in July was slightly below the nation average of 0.7 percent, but well up from the 0.4 percent growth recorded in June. For the past 12 months, prices in San Diego are 6 percent higher.
Portland and Seattle have seen the fastest growing prices this year, with both markets experiencing double-digit gains.
Blitzer said indications are mortgage rates will continue to stay low, encouraging home sales and supporting rising prices.
“The statement issued last week by the Fed after its policy meeting confirms the central bank’s view that the economy will see further gains,” he said. “Most analysts now expect the Fed to raise interest rates in December. After such Fed action, mortgage rates would still be at historically low levels and would not be a major negative for house prices.”
