The Bay Area felt both sides of the ongoing inventory crunch in February, when home prices rose 17 percent from the prior year to a median $1.1 million even as sales plunged 20 percent.
The sales slowdown was attributed to rising prices, few houses for sale, global unrest and stock market dips giving jitters to would-be buyers, the Mercury News reported. The steepest declines were in the most expensive counties of Santa Clara, San Mateo and San Francisco.
“It’s actually sad for buyers,” said veteran agent Gustavo Gonzalez, of San Jose. “It’s so competitive, so expensive.”
Economic uncertainties have given prospective buyers across the nine-county region pause.
Stock prices dropped in the early months of the year, cutting into the wealth of many tech professionals. Interest rates have crept up to 4.7 percent for a standard 30-year fixed mortgage, up from 3.2 percent last year, according to Freddie Mac.
Silicon Valley Association of Realtors’ Brett Caviness
“People’s buying power has been reduced,” Menlo Park agent Brett Caviness, president of the Silicon Valley Association of Realtors, told the newspaper. “That’s the biggest issue — the uncertainty.”
Across the nation, home values grew 20 percent during the last 12 months, with double-digit gains in each of those months, according to CoreLogic, with eight in 10 homes selling above listing prices because of a lack of inventory.
CoreLogic expects higher interest rates and prices to cool the market in the coming months.
All nine counties in the Bay Area reported double-digit price growth year-over-year, while overbidding surged to a four-year high.
The median price for a resale home in Santa Clara County shot up 29 percent to $1.65 million in February. Homes in Alameda County rose 28 percent to $1.2 million, while resale homes climbed 22 percent in San Francisco to $1.83 million. Contra Costa County home prices rose 15 percent to $850,000, while homes in San Mateo County increased 12 percent to $1.79 million.
With rising prices came slowing sales of existing homes. San Francisco plummeted 27 percent, Santa Clara dropped 25 percent and San Mateo fell 24 percent from last February. Condo and new home sales also slumped.
[Mercury News] – Dana Bartholomew
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