San Diego County home prices jumped 8.6 percent in February compared to a year ago, while sales remained tight as the region struggles with a shortage of homes for sale, real estate tracker CoreLogic said Wednesday.
The big picture: The median price in February — $535,000 — is down from its all-time peak, $545,000, reached in June. (The peak of $517,500 reached in November 2005 at the height of the housing boom would be around $652,000 if adjusted for inflation.)
Sales continue to remain tight as there are fewer homes for sale than previous years. In February, there were 4,636 homes listed for sale in February, up by 221 homes from the same time last year, said the Greater San Diego Association of Realtors. But that is far off an an average 5,040 homes per sale each month in 2017; 5,909 in 2016; and 6,610 in 2015.
How prices could change: The Federal Reserve raised its key interest rate Wednesday from 1.5 percent to 1.75 percent, the highest level since 2008. It also said it would raise rates two more times this year. This indirectly affects mortgage rates, which could make homeownership more expensive in the long run, because rates typically track the yield on the U.S. 10-year Treasury.
The lack of inventory may still be more of a factor in fewer home sales this year, said Ruben Gonzalez, chief economist at Keller Williams. "We believe that limited supply is likely to remain the predominate factor restricting home sales this year," he wrote in an email, "and that there is some room for higher mortgage rates before the sales pace of existing homes is substantially impacted."
How different home types fared: Resale condo home prices have gone up the most of any category, 10.8 percent in a year, for a median of $425,500 in February with 806 sales. Newly built homes were up by 3.5 percent in a year for a median of $585,000. There were only 256 new homes sold, down considerably from the early 2000s when more than 1,000 new homes were selling each month.
The market continued to be dominated by resale single-family homes, making up 1,630 sales in February. The median price reached $580,000, up 8.3 percent in a year.
Hot markets: In communities with at least 20 sales, Escondido had the biggest price gains in a year for resale single-family homes. In the city's 92025 ZIP code, prices increased 42.5 percent in a year to a median of $620,000. In the 92027 ZIP code, the median was $499,000, up 24 percent in a year.
For resale condos, Rancho Bernardo (92128) had the biggest increase — 37.2 percent in a year — for a median of $539,000. It was followed by Bay Park (92110) with a 24.4 percent for a median of $444,000.
Interesting data points: Homebuyers may be competing with slightly fewer investors in the coming year. In February, 22.9 percent of home sales went to absentee buyers — typically investors who don't intend on living in the home as a primary residence — down from 23.8 percent at the same time last year.