Bay Area real estate prices dropping
By Emmett Berg, Bay City News Service
October 17, 2006
Adding to a declining trend in the number of home sales, a real
estate research firm reported today that the price of an average
Bay Area home fell for the first time since the dot-com bust in
The median price for a home in the nine-county San Francisco
Bay Area was $611,000 in September, according to DataQuick Information
Systems, the La Jolla-based subsidiary of a Vancouver, Canada
real estate research firm.
The September median home price in the Bay Area was 1.5 percent
less than in August, and 0.8 percent less than the September 2005
mark of $616,000.
Behind the averages, the market typically goes into decline from
August to September because of a shift in purchase patterns, DataQuick
reported. It also noted that increased sales of East Bay conversion
condominiums -- typically lower in cost than single-family homes
-- could have driven the median decrease.
What was more remarkable to analysts was the year-to-year decline
in prices, the first since March 2002, when the region weathered
the collapse of Internet startups.
"This time around there isn't really any economic distress,''
the president of DataQuick, Marshall Prentice, said in a statement.
"It simply looks like the real estate market's momentum last
year and earlier this year pushed prices beyond their equilibrium
point and the market is re-establishing its balance.''
According to DataQuick, a total of 7,907 new and resale houses
and condos were sold in the region last month. That was down 13.4
percent from the 9,128 sold in August and down 29.4 percent from
September 2005, when 11,205 homes were sold.
Only two locales -- San Francisco and Santa Clara counties --
showed positive price gains over last year. In San Francisco,
average home prices rose 3.5 percent to $746,000. That elevated
San Francisco past San Mateo County as the second-most expensive
place in the Bay Area to buy a home, behind Marin County, where
the median was $813,000.
Judging by the number of home sales, double-digit percentage
declines were noted in all nine counties: Alameda, Contra Costa,
Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano and
Sonoma. Aggregated, Bay Area home sales declined 29.4 percent
from September 2005.
Declines were largest in Solano County, which dropped from 1,030
sales in September 2005 to 585 sales last month, and Marin County,
where the number of sales fell from 448 to 273 over the same time
The typical monthly mortgage payment to which buyers committed
was $2,915 in September. That was up from $2,713 in September
2005 but down slightly from last month's average of $2,966.
Overall indicators pointed to moderate indicators of market distress,
according to DataQuick. Fewer people used adjustable-rate mortgages,
and foreclosure rates were considered below normal levels.
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