Home/Mortgages/Bay Area May Home Sales Beat Expectations, Prices Move Higher

June 28, 2012 (Jeff Alan)

Monthly sales of existing single-family homes and condominiums in the San Francisco Bay area improved more than expected in May while home prices beat the previous year’s for a second consecutive month according to real estate information provider DataQuick..

A total of 8,810 new and resale homes were sold in May in the nine county Bay Area, which includes Alameda, Contra Costa, Marin, Napa, Santa Clara, San Francisco, San Mateo, Solano and Sonoma Counties. That was 14.8 percent higher than the 7,675 home sales in April and 26.1 percent higher than the 6,988 sales posted in May of 2011. Year-over-year home sales have improved for 11 consecutive months.

Home sales typically increase around six percent from April to May in the Bay area with last month’s sales still 8.8 percent below the historical average, but it was still productive enough to be the highest amount of sales for a May in six years.

Cash buyers accounted for 28.1 percent of the homes purchased for the month, down from 28.3 percent in April and they paid a median price of $273,500 for their purchases, up from $269,500 the previous month.

Absentee buyers, usually investors and vacation home buyers, accounted for 24.6 percent of all sales, up from 23.5 percent in April, paying a median price of $255,000 for the homes they purchased, down from $271,750 the previous month..

The median sales price for new and resale homes and condos in May increased 2.6 percent to $400,000, up from $390,000 in April. The median price was 8.3 percent higher than in May of 2011, when the median price stood at $372,000. It was the second consecutive month that year-over-year home prices have improved in the area following 19 straight months of declines.

By comparison, the lowest median price posted during the current real estate cycle was $290,000 in May 2009, while the peak median price was $665,000 in June/July 2007.

John Walsh, president of DataQuick, stated, “It’s not exactly a stampede, but people are starting to move off the housing market sidelines in numbers we haven’t seen in quite a while. And it’s not just first-time buyers and investors. There are more move-up buyers in mid- to high-end coastal counties. Many have likely concluded that it makes more sense to take advantage of ultra-low mortgage rates and a relatively low price on their next home than to wait for the value of their existing home to return to some lofty level. Of course, for those who don’t have equity in their homes, it could be years before they’re able to make a move.”

Distressed home sales accounted for 43.8 percent of the Bay Area’s re-sale market last month, up slightly from a revised 43.6 percent in April. Foreclosure re-sales accounted for 21.9 percent of all existing home sales in May, unchanged from April, while short sales also made up about 21.9 percent of the Bay Area’s existing home sales last month, up from a revised 21.7 percent in April.

Tags: Bay Area, DataQuick, home sales, home prices, spring selling season, median sales price, new homes, re-sale homes