Bay Area home prices continue to slip

Bay Area home prices continued to decline in September, as the
regional market slows from the rapid pace set the past seven
years.

The median sales price in September for an existing home in the
Bay Area dropped 4.7 percent, to $810,000, despite low interest
rates, a strong stock market and booming regional economy,
according to real estate data firms CoreLogic and DQNews.

Bay Area home prices are still among the highest in the
nation.

“It’s still a good, strong seller’s market,” said Jeff
LaMont, a Coldwell Banker agent in San Mateo. “It’s still a
challenge for buyers.”

The Bay Area residential market has seen year-over-year sale
prices drop in several months this year. That follows a record run
of rising home prices that began in April 2012 and ended in
March.

Adding to the housing pressure is the region’s robust economy,
which added 5,100 more jobs in August, according to the state’s
Employment Development Department.

Existing home sales increased 3.5 percent, led by busy markets
in outlying counties: Sonoma (up 29 percent), Napa (up 14 percent),
and Solano (up 18 percent). Sales remained relatively flat in
Alameda, Contra Costa, Santa Clara and San Mateo counties.

Year-over-year median prices grew 3.9 percent to $632,500 in
Contra Costa County, increased 4.2 percent in San Francisco to
$1.48 million, and inched up less than one percent to $869,500 in
Alameda County. Prices dropped 3.7 percent to $1.16 million in
Santa Clara County and fell 2.7 percent to $1.45 million in San
Mateo County, according to DQNews.

Agents say buyers are willing to wait for the right deal,
avoiding bidding wars and hesitating to push far past their
budgets. Homes in move-in condition, near transit or with a short
commute, still top the list of desirable features.

Matt Rubenstein, a Compass agent in Walnut Creek, said starter
homes between $700,000 and $900,000 have been attractive,
especially if they’re in good shape and within a strong school
district. “If they show really well, there’s always going to be
interest,” he said.

Rubenstein has noticed some nervousness among buyers — the
market has stayed strong for nearly eight years, and some are
concerned about an inevitable drop. He said he tells buyers to plan
on staying in the house for at least seven years, and trust the
strong, regional economy.

Ramesh Rao, a Coldwell Banker agent in Cupertino, said pricing
at or below comparable homes in a neighborhood is key to attracting
buyers. The market isn’t as hot as it was last year, he said, but
plenty of younger tech professionals still want to buy.

Larger trends in the housing market don’t apply to Silicon
Valley. “Listen to what’s happening locally,” Rao said,
“not nationally.”

As bidding wars have largely receded, house hunters can afford
to shop around a bit longer.

Bay Area natives Tiphanie and Paul Cimoli have bought and sold
houses for 30 years. The couple lives in a single family home in
South San Jose, and wanted to buy an investment property to rent
out to their oldest son and a roommate.

The Cimolis blitzed the market, touring 75 homes in three
months. They bought a San Jose townhome for about $780,000 after it
had been marked down twice and the seller was motivated to get rid
of the unit. Still, the couple found the diligent search a bit more
demanding than other, earlier purchases.

“We actually thought that there were a lot of choices out
there,” Tiphanie said. “We found that the really good ones went
fast.”

Source: FS – All – Real Estate News 1
Bay Area home prices continue to slip