is the drop in median price in Oakland due to people dumping in cheap areas?

Asked by HappyHome, 94704 Sat Feb 14, 2009

I see this on Trulia:

Median Sales Price $210,000 Nov '08 - Jan '09

Do you think this is largely a reflection of investors selling off in cheap parts of Oakland? I realize home values have gone down a lot overall but this % surprised me. Thanks.

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Pacita Dimac…, Agent, Oakland, CA
Sun Feb 15, 2009
Take a closer look at where they have more details by zip code. It's probably a better view of what's happening in various areas of Oakland.

Here's a link to gert you started…

For example, see zip code 94618 where the price drop isn't as significant as the rest of the city. The median price for 94618 is at $827K; 94610 median price is $666K; 94619 is $429K.

And yes, in some areas, the high number of foreclosures and short sales have tended to lower the price since homeowners who are selling their homes as regular sales have had to also adjust their asking price to compete.

In some areas of Oakland, it isn't investors who are responsible for selling properties; rather, it's the result of people defaulting on their loans.

I just checked and there are 1251 homes for sale in Oakland as of this writing. 477 are bank-owned or 38% of total, and 351 are short sales or 28%. Essentially, that means that 2/3 rds of the properties actively offered for sale are either bank-owned or short sales.

This is not true of other Bay area cities. For example, in Alameda, bank owned listings account for less than 10%.

Hope this helps.
1 vote
Gina Odom, Agent, Santa Cruz, CA
Sun Feb 15, 2009
When looking at stats for a large area like Oakland, it's best to break it down by area and zip code. As for an area like Rockridge in the 94618 zip code, in 2007, 248 properties sold and in 2008, 176 properties sold. The average sold price did not change dramatically. In 2007, the average sold price was $937,640 and in 2008 it was $917,663.

However, if you look at areas in certain parts of East Oakland like Chabot Estates & King Estates in zip code 94605 prices have dropped about $100K but properties sold in those areas have increased from 2007. Why? Because when people default on their loans and lose their homes to foreclosures, prices go down and investors come in and buy at low values. It affects the whole neighborhood and the surrounding home values. You can find specific stats for each zip code on my blog:
1 vote
Lisa Cartola…, Agent, Oakland, CA
Mon Feb 16, 2009

Were in Oakland you are looking will greatly affect the median price. Oakland is a very diverse city and pretty large geographically. Right now you can buy a house for $60,000 or $100,000,000 ++. Location is the big differential. Certain neighborhoods are considered highly desirable and home prices are in the $700,000s to over a million. In areas that have been hit harder with foreclosures you will see many homes listed at $200,000 and below.

Yes prices have softened and in some areas much more than others. When looking at the median price overall for Oakland, keep in mind this is the median based on prices throughout the city. Because there are so many distinct areas of Oakland, looking at one number for the whole of the city does not give a truly accurate picture. I find it best to look at the particular neighborhoods you are considering and look at the data for those particular areas to get a more accurate picture of the market for the neighborhood you are looking. This will help to give a better picture for the homes values and the market where you are looking.

Hope this helps,

Lisa Cartolano
Alain Pinel Realtors
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0 votes
Julie Bartle…, Agent, Piedmont, CA
Sun Feb 15, 2009
Median Price is a reflection of which "end" of the market is selling. The answer to your question is yes. I created a chart from MLS data comparing median & average price and another chart showing median price /sq ft in several Oakland Zip Codes.

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