Home sales in the San Francisco Bay Area slowed to their lowest level in 10 years in July and prices increased at the slowest pace since spring 2003, according to DataQuick Information Systems, a real estate information service.
A total of 7,941 new and resale houses and condos were sold in the nine-county Bay Area region in July, which was down 19.1 percent from June and down 30.8 percent from July 2005. July sales hit the lowest point since July 1996, when 7,682 homes were sold. The average July sales count since 1988 is 9,158, DataQuick reported.
Sales fell 41.2 percent in Solano County, 40.1 percent in Sonoma County, 34.6 percent in Alameda County, 29.9 percent in Marin County, 29.7 percent in Santa Clara County, 28.8 percent in Napa County, 26.9 percent in Contra Costa County, 23.9 percent in San Francisco and 16.6 percent in San Mateo County from July 2005 to July 2006.
Prices fell 2.1 percent in Marin County, 0.7 percent in San Mateo County and 0.6 percent in San Francisco while rising 4.7 percent in Contra Costa County, 4.5 percent in Santa Clara County, 3.1 percent in Solano County, 2.7 percent in Napa County, 1.3 percent in Sonoma County and 1 percent in Alameda County from July 2005 to July 2006.
“One of the questions being asked is how much future activity was drawn into the present in 2004 and 2005 when interest rates were at their lowest levels in decades. How much of today’s demand has already been met? If the market is indeed going into a lull, expect low sales and flat prices through fall and on into next year,” said Marshall Prentice, DataQuick president, in a statement.
The median price paid for a Bay Area home was $627,000 in July, down 2.6 percent from June’s record of $644,000, but up 3.5 percent from $606,000 for July a year ago. Last month’s year-over-year increase was the lowest since May 2003 when the $427,000 median was up 3.4 percent.
The typical monthly mortgage payment that Bay Area buyers committed themselves to paying was $3,106 in July. That was down from $3,183 in June, and up from $2,653 for July a year ago. Adjusted for inflation, mortgage payments are 22 percent higher than they were at the peak of the prior cycle 16 years ago.
Indicators of market distress are still largely absent. The use of adjustable-rate mortgages has decreased in the past six months, DataQuick reported. “Foreclosure rates are coming up from last year’s low point, but are still below normal levels. Down-payment sizes are stable and there have been no significant shifts in market mix,” according to the DataQuick announcement.