A home for sale in Del Mar in May. Photo by Chris Jennewein

San Diego home prices rose 1 percent in May, according to the widely-followed Case-Shiller Index, but a national expert downplayed talk of a bubble.

The latest index released Tuesday morning showed San Diego prices up 6.6 percent over the past year as housing prices nationally continued to surge.

“Home prices continue to climb and outpace both inflation and wages,” said David M. Blitzer, managing director of S&P Dow Jones Indices. “Housing is not repeating
the bubble period of 2000-2006: price increases vary across the country unlike the earlier period when rising prices were almost universal.”

“The small supply of homes for sale, at only about four months’ worth, is one cause of rising prices,” he explained. “New home construction, higher than during the recession but still low, is another factor in rising prices.”

Nationwide prices rose 1 percent in May, and were up 5.6 percent over the past year.

A number of Western cities are seeing much bigger price increases than San Diego. Seattle led the nation with a 13.3 percent increase over the past year, followed by Portland at 8.9 percent and Denver at 7.9 percent.

Zillow Chief Economist Dr. Svenja Gudell echoed Blitzer’s concerns about the slow pace of home building.

“At this point in the recovery, the main story in housing is less about rising home prices and more about the falling, woefully insufficient inventory of homes for sale,” Gudell said.

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Chris Jennewein

Chris Jennewein is Editor & Publisher of Times of San Diego.