The Case-Shiller Home Price Index, which is the most accurate of home price metrics, indicates that San Diego home prices were still in decline as of July. The index fell .7 percent from June, which puts it down 7.8 percent from the prior July and 8.3 percent from the November 2005 peak.

The HPI’s decline from its peak is pictured in yellow to the right. Its less reliable price-measuring brethren, the median price and the size-adjusted median, are pictured alongside for comparison.

As I’ve postulated in earlier blog entries, I suspect that prices will start to deteriorate faster as a result of the second wave of mortgage tightening that took place in August. However, the effects of this tighter lending will not even begin to show up until we see the price data for September. The Case-Shiller HPI may be the best home price indicator, but it is certainly not the timeliest — we’ve got two months to wait before we can put the above theory to the test with the release of the September HPI.

— RICH TOSCANO

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