New numbers have arrived: Bay Area home prices were up 7 percent from one year earlier, according to a new analysis by the Pacific Union real estate firm. For the region as a whole, the median price hit $860,000, with the biggest jumps in San Mateo and Marin counties.
Median prices rose about 13 percent in each of those two counties, reaching $1,329,000 in San Mateo and $1,201,000 in Marin. Surveying this crazy market further, Pacific Union says the median price rose 5.8 percent to $1 million on the button in Santa Clara County and 6.12 percent to $1,300,000 in San Francisco.
On the other hand, the median stayed essentially flat in Napa County: “Keep in mind that the median price is affected by the mix of sales,” wrote Selma Hepp, Pacific Union’s chief economist, “and the number of lower-priced homes has been declining for the last few years.”
This chart shows the county-by-county rise in prices for single-family homes and condos between May 2016 and May 2017:
Yes, inventory was down yet again. Yes, competition among desperate buyers drove prices up through most of the region and bidding wars were common. In Santa Clara and Contra Costa counties, homes showed a median time of just 10 days on the market. In San Francisco, homes sold five days faster than a year earlier, the region’s fastest pickup.
“About seven in 10 homes in San Francisco, Silicon Valley, and the Easy Bay again sold for more than original price in May,” wrote Hepp. “And again, while the general competition in the Bay Area loosened somewhat for homes priced below $1 million, it intensified for higher-priced homes. Homes priced between $1 million and $2 million saw the highest share sell over asking price, 72 percent for the entire Bay Area. In San Francisco and Silicon Valley, more homes sold over the asking price in that range than in any other price range.”
Hepp points out some intriguing phenomena.
For instance, with the housing supply low, sales again were down. No surprise there. But this is surprising: the steepest declines were in Sonoma and Contra Costa counties. “This is interesting given the relative affordability of the two regions and the general assumption that buyers are fleeing to such areas,” Hepp continued. “While affordability remains the main factor in relative home price appreciation, the luxury market has shown incredible resiliency. Sales of higher-end homes, priced at $2 million and up, saw the largest sales increase year to date, with 17 percent more transactions than last year.”
You can read the report here.
Finally, Hepp makes another point that often gets lost amid the clamor over rising prices: “It is important to keep in mind that not all neighborhoods and price ranges are equally benefitting from renewed buyer optimism.” In other words, prices are not rising in every neighborhood.
An analysis by ZIP code actually shows prices decreasing or remaining flat in remote parts of the East Bay and South Bay, as well as in some isolated coastal stretches. Hepp put it like this: “The breakdown of home price changes by ZIP codes shows less-accessible markets struggling, while markets close to urban job centers continue to thrive.”
Her comments are born out in this map, provided by Pacific Union. It shows home price appreciation and depreciation, broken down by ZIP code:
Top: Photo shows home for sale in Walnut Creek, Calif. (Jim Stevens/Bay Area News Group)
Tags: affordable housing, affordable real estate, Bay Area housing, Bay Area housing prices, California real estate, median prices