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Bay Area August Home Sales and Median Price Fall

Tuesday, September 22, 2009

Bay Area home sales remained higher than a year ago for the 12th consecutive month. The region's overall median sale price continued to decline as a greater portion of sales occurred in more affordable areas, according to a real estate information service report.

MDA DataQuick reports in the nine-county Bay Area, total of 7,518 new and resale houses and condos closed escrow last month, down 14.3 percent from 8,771 in July and up 4 percent from 7,232 in August 2008. Last month's sales were 24 percent below the average number of sales, 9,886, for the month of August since 1988, when DataQuick's stats begin.

A thinner inventory of distressed properties for sale, hence fewer "bargains," helps explain the relatively sharp drop in sales between July and August. The number of foreclosed properties that resold in August fell 15.2 percent from July. Moreover, July was a relatively strong month for escrow closings – the strongest for any month since August 2006. July closings mainly reflect purchase decisions made in early summer, whereas August closings reflect home shoppers' ability and willingness to buy in the middle of summer.

"Part of the mid-summer pause in the market could have been caused by home shoppers becoming frustrated by market conditions they didn't anticipate. In many areas there were fewer homes, especially cheap foreclosures, to choose from, and lots of talk about multiple offers and all-cash deals. It might have driven some back to the sidelines," said John Walsh, MDA DataQuick president.

"At the same time, people are still concerned about job security, and about how many foreclosures might yet hit the market," he said. "There are ongoing reports of mortgage delinquencies rising, yet the number of homes being foreclosed on has trended down lately. It's bred a lot of uncertainty among the pundits and the public about how many more foreclosures are coming, when they'll hit, and what impact they'll have on prices."

The median price paid for all new and resale houses and condos last month fell to $360,000, down 8.9 percent from $395,000 in July and down 19.5 percent from $447,000 in August 2008. Despite the August median's plunge from July, it was the second-highest for any month since last October, when it was $375,000.

The median's drop between July and August was mainly the result of a shift toward a higher percentage of sales occurring in lower-cost inland areas. Sales fell the most – 21.1 percent – between July and August in Santa Clara County. Its share of total Bay Area sales fell to 23.1 percent in August, down from 25.1 percent in July.

"Sales are continuing at a very good pace," Silicon Valley Association of REALTORS®  Los Gatos/Saratoga District Chair Ian McCrae announced at last week's tour meeting.

Information from MLSListings Inc., the REALTOR® association's Multiple Listing Service, shows in Santa Clara County, sales increased in Saratoga, Los Gatos Mountains, Monte Sereno and San Martin in August from that of the prior month. Other areas of the county saw a decline in month-to-month sales, but an overall increase from the prior year.


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.

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