Home Prices Down in January

 

The Case-Shiller index of San Diego home prices declined once again in January, falling by 1.6 percent for the high-priced tier, 1.0 percent for the mid-priced tier, and .2 percent for the low-priced tier.  (The tiers represent, respectively, the top, middle, and bottom one-third of homes sold by price).  The overall San Diego index fell by 1.1 percent.

As the following graph shows that the middle and high tiers are now below the post-bubble low points they hit in early 2009.  (I guess that means I should remove the word “2009 trough” from these graphs).

 

The winter months are usually weak for pricing, so the seasonally-adjusted indexes fared a bit better.  They were down .4 percent for the high tier, .6 percent for the medium tier, .2 percent for the low tier, and .3 percent in aggregate.  So, prices were down (though just barely) even when seasonality is accounted for.

The seasonally-adjusted mid-priced and high-priced indexes are also now at new post-bubble lows:

 

Here’s a look since the bubble topped out.  In aggregate, San Diego prices are down 40.6 percent from the peak.

 

The price decline is worse when we account for the fact that a dollar today is worth less than a dollar was at the peak in November 2005.  In real (inflation-adjusted) terms, San Diego prices have almost been cut in half, down 48.5 percent.

 

For a long-term view, here is a look at the entire history of the Case-Shiller tiered indexes, also adjusted for inflation:

 

Rich Toscano is a financial advisor with Pacific Capital Associates*.  He can be contacted at rtoscano@pcasd.com.

Voice of San Diego is a nonprofit that depends on you, our readers. Please donate to keep the service strong. Click here to find out more about our supporters and how we operate independently.


Rich Toscano

Rich Toscano

Rich Toscano is a San Diego financial advisor who has been writing for Voice of San Diego since 2006. He maintains his own San Diego housing blog at piggington.com.

  • 82 Posts
  • 3
    Followers

Show comments