Decrease in Bay Area Home Prices

Now we all know that the Bay Area’s housing market has been booming. Selling your home in this region has been entertaining for many with constant overbidding on the already highly valued property. With its peaks leading the nation, one thing is for sure though; it can’t last forever. Indeed, all things must come to an end and take a new direction either better or worse than before. Any credible property management company will acknowledge these truths but encourage taking advantage of the opportunity while it lasts. Nonetheless, Black Diamond has taken note of the previous months and observed some price reductions. The month of May has shown some compelling implications on what the future will hold. Perhaps the Bay Area housing market is taking a nose dive but does this mean it won’t hold water?

The average asking price for a new or previously occupied home or condominium in the Bay Area has dropped over 1 percent since April. However, the present number is still 5 percent higher than May of 2014. The amount of homes that were sold in May also decreased. Out of all of the counties in the Bay, a little more than 8,000 homes were sold. This was a decrease of exactly 1 percent than the month prior. The specifics vary by region. For example, San Francisco, Santa Clara and Alameda County experienced a new peak in prices last month in comparison to San Mateo’s tipping point during April. It’s as if the majority of homes continue to appreciate but the gains are a lot less substantial than 2014. Due to increasing value and shrinking inventory, homes are being sold a lot less frequently. It has been climbing pretty consistently in quarter 2 of this year though. We can only wait and see what will happen in the months to come and depending if you’re a homeowner or homebuyer; you may have different hopes for how things work out. Check out the charts below for a more detailed explanation.

Total Homes Sold/Median Prices in May 2015 for Select Bay Area Counties 
(Reflects total home sales)

County Homes Sold May 2014 Homes Sold May 2015 Percent Change Median Sale Prices May 2014 Median Sale Prices May 2015 Percent Change
Alameda 1,506 1,580 4.9% $576,750 $650,000 12.7%
Contra Costa 1,516 1,616 6.6% $464,500 $480,000 3.3%
Marin 375 398 6.1% $827,500 $897,500 8.5%
Napa 123 125 1.6% $550,000 $543,500 -1.2%
Santa Clara 1,870 1,863 -0.4% $736,250 $800,000 8.7%
San Francisco 574 547 -4.7% $947,500 $1,100,000 16.1%
San Mateo 719 684 -4.9% $880,000 $960,000 9.1%
Solano 527 657 24.7% $302,500 $325,000 7.4%
Sonoma 582 560 -3.8% $440,000 $490,000 11.4%
Bay Area Total 7,792 8,030 3.1% $619,100 $650,000 5.0%

 

Source: SFGate