SILVAR  :  Newsroom  : Real Estate Articles

Real Estate Articles

REALTOR®: Bay Area home sales still slow, prices up

Wednesday, July 25, 2007

Bay Area homes continued to sell at their slowest pace in 12 years last month, led by sharp declines in many lower-cost neighborhoods. At the same time, sales tended to fare much better in higher-priced areas, which helped push the region's overall median sale price to a new peak, a real estate information service reported.

A total of 7,964 new and resale houses and condos were sold in the nine-county Bay Area in June. That was down 1.4 percent from 8,080 in May, and down 26.5 percent from 10,830 for June a year ago, according to DataQuick Information Systems.
Sales have decreased on a year-over-year basis the last 29 months. Last month's sales count was the lowest for any June since 7,780 homes were sold in 1995. The strongest June in DataQuick's statistics, which go back to 1988, was in 2004 when 15,735 homes were sold. The June average is 10,546.

"Obviously there's still a bit of a standoff between buyers and sellers. It looks like unsuccessful sellers would rather take the home off the market than bring the price down, which is remarkable after almost two-and-a-half years of sales declines. Mainly, the price adjustments we're seeing are in more affordable outlying parts of the Bay Area, and those adjustments aren't all that significant except for Solano County," said Marshall Prentice, DataQuick president.

The median price paid for a Bay Area home increased last month to $665,000, up 0.8 percent from $660,000 for the month before, and up 2.6 percent from $648,000 for June last year. The median declined in Solano, Sonoma and Napa, the three most affordable Bay Area counties, while it increased in Marin, San Francisco, San Mateo and Santa Clara counties, the four most expensive.

According to the DataQuick report, sales in Santa Clara County were down 21.7 percent in June 2007 compared to the prior year. The median home price was $7699,000, up 2.6 percent from the previous year. The market is spotty with regard to home sales, according to Silicon Valley Association of REALTORS® President Mark Burns, and many potential home buyers are impacted by affordability constraints, especially in Silicon Valley, where the supply of affordable homes is limited.

The typical monthly mortgage payment that Bay Area buyers committed themselves to paying was $3,219 last month, up from $3,090 the previous month, and up from $3,203 a year ago. Adjusted for inflation, current payments are 24 percent above typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 2.3 percent below the current cycle's peak one year ago.

DataQuick likewise reported June sales continued to fall statewide. A total of 38,291 new and resale houses and condos were sold in the state of California in June, up 3.6 percent from May, and down 32.8 percent from June 2006. Last month's sales made for the slowest June since 1995 when 36,941 homes were sold. June sales from 1988 to 2007 ranged from 35,437 in 1993 to 76,669 in 2004. The average is 51,799.

The median price paid for a California home last month was $479,000, down 1 percent from the record high of $484,000 for March, April and May. That was down 0.2 percent from $480,000 for June a year ago. The year-over-year decline in median was the first since January 1996, when the then-median of $146,000 was down 2.0 percent from $149,000 a year earlier.

Overall, the typical mortgage payment that California home buyers committed themselves to paying last month was $2,319, up from $2,266 in May, and down from $2,372 for June a year ago. Adjusted for inflation, mortgage payments are 10 percent above the spring 1989 peak of the prior real estate cycle.

DataQuick noted indicators of market distress continue to move in different directions. Financing with adjustable-rate mortgages has declined significantly. Foreclosure activity is rising, although foreclosure properties are not yet a drag home on home values in most markets. Down payment sizes are stable flipping rates and non-owner occupied buying activity is down.


The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.

The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.

Variations of this article have appeared in local area newspapers.

For further information, please contact Rose Meily at SILVAR Public Affairs, email , or phone (408) 200-0109.

» Back to Real Estate Articles

Site Navigation