The normalization of the Bay Area market isn’t limited to San Francisco and Silicon Valley. The Marin County and East Bay real estate markets aren’t climbing as fast in price, while sellers face a more lenient buying process, according to Pacific Union’s second quarter report.
“Prices aren’t going down, but there’s a slow down in price growth,” said Selma Hepp, chief economist at Pacific Union. “There’s a huge inventory problem for our region, but I think we’re seeing a healthy plateauing of the market.”
East Bay real estate affordability allows premium pricing
Head toward Oakland and Berkeley, and prices are considerably lower than the median in San Francisco. Given a larger range of affordability, the East Bay real estate market sales in the second quarter are forecasted to become the most active of 2016.
“Easy Bay areas are still doing well,” said Selma Hepp, Chief Economist at Pacific Union. “Generally, the more affordable areas of the market continue to go strong compared to the slowdown in the middle range luxury.”
In the second quarter, the East Bay real estate market favored sellers with 80 percent of sales bringing multiple offers and selling above list price. While affordability is better, buyers are paying 15 percent above asking.
“We still see these premiums in the affordable ranges, and the East Bay is the more affordable part of the region,” said Hepp. “In San Francisco, you’re seeing almost no premiums, but it depends on the price range.”
East Bay buyers prioritized BART accessibility. Homes between $800,000 and $1 million sold best.
“The lowest priced segment is still strong, particularly with accessibility to job centers and access to transportation,” she said.
According to the daily updated report for the East Bay, home prices are up 6.6 percent year-over-year. Inventory grew a slight .6 percent, while time on the market reached 46 days. Sellers of East Bay real estate received approximately 117 percent of asking price, on average.
Marin buyers more established and selective
In Marin County, buyers expressed less urgency, which in turn, limited bidding wars. Buyers in Marin County also tended to be more meticulous with their options, the report explained.
Hepp noted that Marin buyers differ from the up-and-coming millennial professional seen further south in the Bay Area market.
“There’s also a higher median price there, and mostly people with family wealth,” said Hepp. “What we’re seeing are people who have established a history in San Francisco with a family life.”
The price category with the highest sales volume was between $1 and $3 million, but inventory continues to hamper affordability, falling 6.4 percent year-over-year, according to the market-at-a-glance.
The updated data shows home prices up 6.6 percent year-over-year. Average time on the market dropped to 70 days from almost 82 days last year.