As home values grow, sales in the San Francisco Bay Area continue to fall, according to the latest data from property analytics provider CoreLogic.
In total, only 4,354 homes were sold in Alameda, Contra Costa, Marin, Napa, Santa Clara, San Francisco, San Mateo, Solano and Sonoma counties in February — down 12.8 percent from the same time last year. While the drop is not as steep as it had been in previous months, the number of homes sold in the Bay Area is still 43.9 percent below the area’s historical average for February.
“For the third month in a row, Bay Area home sales were at an 11-year low for that month,” Andrew LePage, a CoreLogic analyst, said in a prepared statement. “However, the year-over-year decline in sales has ratcheted down the past two months, from a nearly 22 percent annual drop last December to a decline of just under 13 percent last month.”
Such numbers, which have hit 11-year lows for the past three months, have a lot to do with the area’s notoriously-high home values. The median home in the Bay Area now commands $770,000, up 5.5 percent from last month and 2.7 percent from February 2018. Only 24 percent of all homes sold have cost less than $550,000.
In some ways, the Bay Area reflects an extreme version of what is happening across the country as a whole. As prices rise, more homebuyers are forced to put off a home purchase due to growing unaffordability. What’s more, growing numbers of homes are being purchased by absentee buyers — in the San Francisco area, 19.5 percent of all homes were bought by investors and second-home buyers, up from 17.6 percent last month.
Still, February’s numbers show that there may be hope for average-income and first-time buyers after all. According to CoreLogic, falling mortgage rates may allow some prospective buyers to make the leap into homeownership in the coming months.
“The lessening of the declines likely reflects, among other things, a significant drop in mortgage rates since they hit a seven-year high last November, as well as more listings compared with early last year and an improving stock market in early 2019,” LePage said. “Those factors are likely putting some would-be buyers back into home-shopping mode.”