Prices rose 0.9 percent in February following a decline of 0.2 percent in January. Despite the rise, the string of declines has lowered price appreciation over the past 12 months to just 1.1 percent.
Lower price appreciation was a pattern across the United States, but especially among the largest cities in California.
“The pace of increases for home prices continues to slow,” said David M. Blitzer, managing director at S&P Dow Jones Indices, which produces the report. “The three California cities of Los Angeles, San Francisco and San Diego have the three slowest price increases over the last year.”
Blitzer said a major factor in the slowing appreciation is a decline in sales of existing single-family homes, which he said reached a peak in February 2018.
“Sales of new homes, housing starts, and residential investment had similar weak trajectories over the last year,” he noted.
Zillow, the online real estate service, also credited the “wider range of inventory” in moderating the rise in home prices.
“Home prices continued to tap on the brakes in February, moderating their earlier breakneck speeds, particularly in pricey West Coast markets,” said Zillow economic analyst Matthew Speakman. “The slowdown reflects the wider range of inventory that buyers had available this winter, which gave them more breathing room around prices than they have had in a while.”
The San Diego Regional Chamber of Commerce‘s Sean Karafin said that despite the recent declines, affordability remains a major issue in the San Diego market.
“The trend we see with home prices reflects the broader economic cycle, but affordability remains a major issue for employers trying to attract and retain talent,” he said. “It’s limiting economic opportunity for the San Diego families that need it most. Adding housing supply is the only long-term effective strategy for getting a hold of our affordability crisis.”
>> Subscribe to Times of San Diego’s free daily email newsletter! Click hereFollow Us: