Home News Report: San Diego home prices aren’t rising quite so fast as they were

Report: San Diego home prices aren’t rising quite so fast as they were

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San Diego’s bright red housing market is starting to cool. According to the latest data, prices in April did not rise as much as last month.

House prices in the San Diego Metro region in March rose 29.6% from March 2021, the highest in 18 years.

However Case Shiller Index They are tracking homes, but report that they rose only 28.5% in April. It’s still a very high rate of increase, but the move in the opposite direction is noteworthy. Cross-country mortgage Vice President Scott Evans said the main factor behind this was mortgage rates.

“I think the biggest impact of the slowdown is rising interest rates, delivery … almost 90%,” he said.

Monthly mortgage payments for $ 500,000 in San Diego’s homes are rare these days, with a 20% down payment increased by more than 30% compared to the beginning of the year, Evans said.

“That is, (a) a $ 400,000 loan, the payment is about $ 3,000 … 6 months ago, it was probably $ 700 less,” he said.

“In fact, we’re back to what it was before the pandemic,” said Jeremy Gabe, an assistant professor of real estate. University of San Diego.. Gabe said the big impact of rising mortgage rates is keeping people home and reducing inventories.

“Currently, most people who own a home have a mortgage that is fixed at a lower interest rate than the prevailing interest rate, so they move up the home ladder or move the home ladder up. It’s less likely to move sideways, “he said.

Gabe also said that high interest rates will not have a significant impact on middle- and high-income people, but rather will reduce prices on low-income people.

“Speaking of South County, we may see downward pressure caused by lower market demand due to rising interest rates to offset inventory shortages,” he said. As a big impact, housing will probably track inflation.

Glass is half empty: It is now much more difficult for low-income earners to enter the housing market. Half Full: It’s just returned to what it was before the pandemic, far from what it was in the 1980s when interest rates were double digits.

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