Home > Blogs > California > Alameda County > Oakland > Claire Wills forwards this Oakland Tribune article on the recovering Bay Area housing market.

Claire Wills 510-255-1196's Blog

By CLAIRE WILLS ® | Agent in 94610

Claire Wills forwards this Oakland Tribune article on the recovering Bay Area housing market.



Report: Bay Area housing market shows signs of recovery

By Pete Carey pcarey@mercurynews.com
Posted:   06/14/2012 12:23:23 PM PDT
Updated:   06/14/2012 05:57:53 PM PDT

The Bay Area's recovery from the housing crisis gathered strength in May, with big gains in sales of all types of homes across the region and price increases in nearly every county.

Bolstering hopes that the recovery is here to stay after a six-year slump, a key missing link to the market's health has returned: move-up buyers who sell their existing homes to buy larger, more expensive houses. First-time buyers also are dipping their toes in the market, encouraged by historic low interest rates and reports of rising prices.

A surfeit of buyers has sparked bidding wars around the bay.

"This particular summer is white hot. Sellers are more comfortable about getting their homes on the market, and buyers are just dying to get in," said Barbara Lymberis, president of the Santa Clara County Association of Realtors. The number of homes for sale is climbing, she said, as potential sellers respond to growing demand.

In a report released Thursday, the real estate information company DataQuick said Alameda, Santa Clara and San Mateo counties turned in their strongest May sales of single family homes since 2006, just before the housing crash. It was the highest May in Contra Costa County since 2010.

Combined sales for all types of homes, from condos to existing and new single family houses, were at a six year high in May in the nine-county Bay Area, according to DataQuick. The combined median sales price was up for the second straight month,


to a 22-month high.

There are still more than the average numbers of investors, cash buyers and foreclosures, but those are down from peak levels during the housing crisis. Foreclosure resales are half what they were during the worst of the crisis.

The median sale price of an existing single family home was $615,000 in Santa Clara County, up 3 percent from April and about 5 percent from a year ago. In San Mateo County, the median price dropped slightly to $625,000, down 1.5 percent from April and 3.5 percent from last year.

The median was $305,000 in Contra Costa County, up 3 percent from April and nearly 14 percent over last year. Alameda County's median sales price was $410,500, up 9 percent from April and almost 4 percent over the year.

"It's crazy," said Kevin Kieffer, an agent with Keller Williams Realty in Danville. "It's gone from being a soft seller's market to being a tough buyer's market in the blink of an eye."

At current levels, there's only a month or less supply of homes for sale in many Bay Area counties, according to the real estate brokerage Redfin.

"There's not enough homes to go around," said Miawand Bayan, an agent with Redfin in Fremont. "I have buyers getting to the point where they are so frustrated they will either drastically overpay, or wait another year and hope it gets better."

Kathy and Dale Karren of San Jose have been trying to buy their first home for six months, looking at half a dozen properties a week.

"Every time we find a house that we like, so do 40 other people. Then it begins to be a bidding war," said Kathy Karren. "We made an offer on a huge fixer-upper two weeks ago, but I don't know if we have a shot at that," she said.

They're using a low-down payment FHA mortgage, she said, which might be trumped by investors offering to pay in cash.

"We thought we'd go out and find a house in maybe two months, but it's not that way at all," she said.

The hurdles facing a first-time buyer are "a tragedy," said Phil Billiet of Better Homes Realty in San Jose.

On one recent foreclosure sale, Billiet said, the bank accepted a cash offer from an investor that was lower than the bid of a buyer with an FHA approved loan. "Cash is king. Cash is winning deals," Billiet said.

Although Bay Area sales were the highest for a May since 2006, they are still about 8 percent below the average number of sales in May since 1998.

Sales of existing single family homes were up 17 percent from April in Santa Clara County and up 33 percent from May 2011, according to DataQuick. They increased 8 percent from April in Contra Costa County and 12.6 percent from last year. They were up 36 percent from April and 27 percent from a year earlier in Alameda County but were essentially unchanged in San Mateo County.

"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," said John Walsh, DataQuick's president.

Walsh said the "move-up buyer" selling a home to buy a larger, more expensive one, has returned. That's the signal of recovery that many real estate professionals have been waiting for.

Still, many people are stuck with negative equity -- homes worth less than their mortgages -- and "it could be years before they're able to make a move," Walsh said.

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