Bay Area Single-Family Home Prices Increase 9.9% in May, Sales Expected to Slow Mid-Summer

Jun 14, 2010, 18:31 ET from Redfin

SAN FRANCISCO, June 14 /PRNewswire/ -- Redfin today released new data on the San Francisco Bay Area market showing that the median price of a Bay Area single-family home increased 9.9% from April to May, and 32.8% year over year. The number of house sales that closed increased 10.1% from April to May. As the market enters what is typically its busy summer season, inventory has remained low and even still, competition has decreased, especially for lower-priced homes.

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Inventory Drops Across Four Counties

In May 2010, the number of single-family homes for sale declined across four of the six core Bay Area counties:


County

Compared to April  2010

Compared to May  2009

Alameda County

-4.7%

-9.0%

Contra Costa County

-3.6%

-13.7%

San Francisco County

-0.2%

-7.8%

San Mateo County

+2.5%

-2.3%

Santa Clara County

-5.1%

-20.7%

Marin County

+0.7%

-13.8%

# of Houses for Sale in May 2010




"Overall things feel slow," said Redfin San Francisco agent Gina Pio Roda. "Many of my clients are on vacation right now, and for the rest the inventory isn't that exciting. Three clients have expanded their search from the City to include places like Burlingame or Marin because there are so few single-family homes for sale in San Francisco."

Sales Volume Increases In May

Driven by the federal tax credit, May sales volume in the Bay Area increased in all of the core counties. For sales of single-family homes, the biggest increases came in San Francisco and Santa Clara Counties:


County

Compared to April 2010

Compared to April 2010

Adjusted for # Weekdays

Compared to May 2009

Alameda County

+13.0%

+18.3%

-0.3%

Contra Costa County

+3.1%

+8.0%

-7.7%

San Francisco County

+14.7%

+20.1%

+18.3%

San Mateo County

+7.9%

+13.1%

+15.4%

Santa Clara County

+14.3%

+19.8%

+14.9%

Marin County

+9.8%

+15.0%

+33.1%

# of Houses That Sold in May 2010




The increase in sales volume was even more noteworthy given that May had more weekdays than April; virtually all closings occur on a weekday, when escrow offices are open. The table's middle column reflects the increase in the number of closings per weekday, comparing the May 2010 rate to April 2010.

Based on activity its agents are seeing now, Redfin expects sales volume to dip in July, and a significant increase in listings to reach the market in two or three weeks.

Meanwhile, prices increased in May across all counties except San Francisco and Marin, driven in part by the absorption of significant foreclosure inventory in the East Bay. But the momentum of price increases on the Peninsula has definitely slowed:


County

Change in Median Price Since April 2010

Change in Median Price Since May 2009

Change in Median $/SqFt  Since April 2010

Alameda County

+18.8%

+30.9%

+6.3%

Contra Costa County

+7.9%

+29.9%

+9.7%

San Francisco County

-3.8%

+2.0%

-7.0%

San Mateo County

+0.3%

+4.9%

+5.2%

Santa Clara County

+1.6%

+29.8%

+5.3%

Marin County

-0.9%

+10.7%

+3.3%

Change in Median Price of Houses That Sold in May




The neighborhoods most likely to withstand pricing pressure are those with good schools. "Prices in the neighborhoods with good schools are staying strong if not increasing," said Redfin agent Miawand Bayan, who covers the southern and eastern portion of the Bay Area. "Fremont's Mission District and San Jose's Evergreen District are seeing a lot of offer activity and are also seeing sale prices increase month over month."

Bidding Wars Becoming Less Common

To gauge the direction the market is headed this summer, Redfin also monitors the competition its agents and customers face in negotiating May deals set to close in June or July. The Bay Area deals that Redfin negotiated over the past 30 days saw a big drop in competing offers:


County

January 2010

February 2010

March 2010

April 2010

May 2010

Listings >= $500K

66%

85%

84%

79%

75%

Listings < $500K

85%

92%

95%

82%

62%

All Listings

73%

88%

88%

80%

72%

Percentage of Offers Handled by Redfin That Faced Competition




The drop was particularly sharp for listings priced below $500,000, as many buyers in that price range had either negotiated a deal by the tax-credit deadline or decided to take a break from their home search:  http://blog.redfin.com/sfbay/files/2010/06/competitiveoffersbayareamay2010.png

About Redfin Real Estate Reports

Market-wide data for the Bay Area spans twelve counties: Alameda, Contra Costa, Marin, Monterey, Napa, San Benito, San Francisco, San Mateo, Santa Clara, Santa Cruz, Solano and Sonoma. The full report, with data at county, city, neighborhood and postal-code levels, is available at:

http://blog.redfin.com/sfbay/files/2010/06/Redfin-Bay-Area-Real-Estate-Market-Report-May-2010.xls

Redfin's real estate market reports draw data from more sources than any other, including the Multiple Listing Services (MLSs) that brokers use to take properties on and off the market in real time; for-sale-by-owner websites used to market properties unrepresented by brokers; government records that officially record any property sale; and government records on city and county borders. Because Redfin as a broker has access to MLS databases, it is able to identify market changes before sales are publicly recorded. Unlike other reports, Redfin also provides county- , city-, neighborhood-level, and zip code-level detail, disclosing the number of records available in each area.

No report based on tens of thousands of records, all captured by human beings, can eliminate every error, but Redfin has been careful to do so wherever reasonably possible. Reconciling multiple data sources allows Redfin to correct errors in each; sales aren't double-counted, and records for the same property but with conflicting prices and square footages are flagged for further analysis. The reports analyze houses and condos separately, and exclude townhouses. More detail on Redfin's reporting methodology is available at: http://www.redfin.com/about/monthly-report-methodology

About Redfin

Redfin (www.redfin.com) is the real estate industry's first online brokerage, combining a customer-focused team of real estate agents with online tools for making the process of buying or selling a home easy. Redfin's agents handle every facet of a transaction, including tours, pricing analyses, negotiations, inspections and closings. Redfin is the only major search site to feature listings direct from broker databases as well as for-sale-by-owner and foreclosure properties from across the Internet. The company pays its agents customer-satisfaction bonuses, not commissions, and surveys every client, publishing each survey alongside the agent's complete deal history. Redfin's service is available in the metropolitan areas of AtlantaBoston, ChicagoSeattlePhoenixPortland, ORWashington DCBaltimoreNew York's Long Island and Westchester County as well as most of California, including the San Francisco Bay AreaSouthern California and Sacramento. To keep track of our daring exploits, subscribe to blog.redfin.com or our Twitter feed @redfin.

SOURCE Redfin



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