Market is cooling down
Single family home sales dropped and prices hit a plateau in much of the Bay Area, according to the real estate information company Corelogic DataQuick.
The turbocharged Bay Area housing market ran out of gas in July as the region turned out the lowest annual price gain in almost two years, according to a report Thursday.
There were several reasons for the slowdown, including a decline in affordability and a tight mortgage market, the Irvine-based company said. Also, sales typically decline about 5 percent from June to July.
The Bay Area's 7.8 percent yearly gain in median sales prices for single family homes marked the first single-digit year-over-year gain since August 2012, when it increased just 6.1 percent.
It's most likely the inevitable winding down of a long run of astonishing price gains. Single family home prices are up about 50 percent in two years in Alameda and Contra Costa counties and about 25 percent in Santa Clara and San Mateo counties, and are up about 40 percent in the nine-county Bay Area.
"In a number of ways, we do continue to edge toward normalcy," said Andrew LePage of Corelogic DataQuick. He said two years of double-digit price gains were unsustainable in the long run.
San Mateo and Contra Costa counties were among those seeing single-digit price gains for the first time in about two years, while Santa Clara County's single-digit gain was only the second in 23 months.
San Mateo County prices were up 7.4 percent from the previous July to $895,000; Santa Clara County rose just 9.5 percent to $810,000, and Contra Costa County sales prices increased 9.3 percent to $492,250. Alameda County had a double-digit gain of 13.9 percent to $649,000, and San Francisco, with a $1,020,00 median price, was up 25.9 percent from a year earlier.
Sales were down or just slightly up in most counties, with Santa Clara seeing the biggest dive ---a 14.8 percent drop from July 2013.
For the nine-county Bay Area, sales were off by 6.7 percent.
Investors appeared to be retreating from the region's housing market, as absentee buyers -- mostly investors -- made up 18.8 percent of all Bay Area home sales, the lowest since September 20012.
There were also fewer buyers paying cash, which were at the lowest level since November 2008.