Signs of Stabilization in the Bay Area Housing Market During the Fourth Quarter

Earthtimes.org (Press Release)


Signs of Stabilization in the Bay Area Housing Market During the Fourth Quarter
Posted on : 2007-01-23 | Author : Prudential California Realty
News Category : PressRelease

PLEASANTON, Calif., Jan. 23 /PRNewswire/ -- As sales decreased 22 percent in the fourth quarter across the Bay Area, year-over-year, downward trends were moderating in most counties, according to a report released today by the research division of Prudential California Realty. Price appreciation was stable, rising by one percent across all housing types over the same period last year. Inventory grew (+22%, year-over-year) but gains slowed dramatically over previous quarters.

"The sharp rate of the downturn has definitely decelerated. Unit sales are still down considerably from 2005 levels, however the decreases became smaller each quarter as the year ended. At the same time, the rate of new listings coming to the market leveled off and dropped," said Scott Kucirek, general manager of Prudential California Realty based in Pleasanton. "Although it's still early, these are positive signs that the market is finding its legs in this correction and stabilizing."

Fourth Quarter Bay Area Market Summary 2006 Median Price* Home Sales Q4 2006 Q4 2005 % Q4 2006 Q4 2005 % Housing Type change change Single-Family Detached Homes $740,615 $729,183 +2 10,970 14,147 -23 Single-Family Attached Homes $488,486 $483,921 +1 2,400 3,000 -20 Average Days on Market Active Listings** Q4 2006 Q4 2005 difference Q4 2006 Q4 2005 % Housing Type (in days) change Single-Family Detached Homes 57 40 +18 38,453 31,864 +21 Single-Family Attached Homes 61 32 +31 8,450 6,726 +27

After a glut of mid-year inventory shifted the market from a strong sellers' to a buyers' in a short period, buyers enjoyed a great deal of choice and were able to make demands for price reductions. This had an impact on inventory levels in the fourth quarter as some homeowners removed their properties from sale and more choose to wait and see how the market would fare before listing.

Across the counties, homes that did sell continued to spend longer on the market, averaging 24 days more than in the fourth quarter 2005. The spread included San Francisco at +9 days and Napa at +47 days on market, year-over-year. While buyers and sellers were not as out of sync as they had been in second and third quarter 2006, it still took more time to negotiate a deal that both parties felt was equitable, which contributed to more days on market.

As price increases softened on mid-priced homes in several counties, pockets of luxury homes in San Francisco and close to Silicon Valley experienced the strongest price growth in the fourth quarter. In Atherton, San Mateo, the median price of a single-family detached home grew by 12 percent to $3,252,500, the highest median price in the Bay area. The median price for the same property type in the Pacific Heights area of San Francisco jumped by 18 percent to over $2.6 million.

Added Kucirek: "Although there is some consumer apprehension, demand for homes remains solid in the Bay Area, and in the fourth quarter it was buoyed by a rebound of hiring in the tech sector. Currently, we are still in a transition period and it will take the spring market to really see where the market nets out in terms of both activity and price resiliency."

Survey of Bay Area Counties' Median House Prices - Fourth Quarter 2006 Single-Family Detached Homes Single-Family Attached Homes Fourth Fourth Fourth Fourth Quarter Quarter % Quarter Quarter % 2006 ($) 2005 ($) change 2006 ($) 2005 ($) change Alameda County $636,881 $648,283 -2 $416,079 $422,497 -2 Contra Costa County $651,700 $655,369 -1 $344,976 $389,835 -12 Marin County $944,760 $994,989 -5 $550,969 $538,801 +2 Napa County $610,000 $618,000 -1 $425,000 $422,450 +1 San Francisco County $978,049 $929,561 +5 $742,560 $719,418 +3 San Mateo County $1,001,896 $988,209 +1 $496,407 $501,196 -1 Santa Clara County $859,790 $811,224 +6 $437,467 $435,637 0 Solano County $456,933 $474,545 -4 $292,183 $313,328 -7 Sonoma County $553,133 $578,326 -4 $348,510 $388,563 -10 Bay Area median $740,615 $729,183 +2 $488,486 $483,921 +1 Survey of Bay Area Counties' Home Sales - Fourth Quarter 2006 Single-Family Detached Homes Single-Family Attached Homes Fourth Fourth Third Third Quarter Quarter % Quarter Quarter % 2006 2005 change 2006 2005 change Alameda County 2,357 2,979 -21 369 501 -26 Contra Costa County 1,976 2,856 -31 296 391 -24 Marin County 432 462 -6 128 143 -10 Napa County 187 213 -12 31 48 -35 San Francisco County 675 848 -20 508 562 -10 San Mateo County 1,070 1,296 -17 255 317 -20 Santa Clara County 2,550 3,306 -23 574 725 -21 Solano County 809 1,070 -24 92 137 -33 Sonoma County 914 1,117 -18 147 176 -17 Bay Area totals 10,970 14,147 -22 2,400 3,000 -20 * The median home price for the entire region is the weighted mean of median home prices of cities within the San Francisco Bay Area. ** Active listings is the sum of listings that were available for sale for at least one day within the quarter. This can include listings from previous quarters. Days on market (DOM) is the number of days a property was listed on the market until it went under contract at its final listing price. This is may not reflect previous listings. Data are sourced from multiple listing services and are deemed reliable but not guaranteed. All percentages rounded to nearest whole number. Bay Area refers to sales within Alameda County, Contra Costa County, Marin County, Napa County, San Francisco County, San Mateo County, Santa Clara County, Solano County and Sonoma County. About Prudential California:

Prudential California Realty



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