La Jolla, CA.-----The median price paid for a Bay Area home in June jumped to its highest level in almost four years, the result of an ongoing shift in the types of homes selling, slightly improved mortgage availability, and ultra-low interest rates on home loans. Sales increased on a year-over-year basis for the 12th month in a row, a real estate information service reported.
The median price paid for all new and resale houses and condos sold in the nine-county Bay Area last month was $417,000. That was up 4.3 percent from $400,000 in May, and up 10.4 percent from $377,750 in June 2011, according to San Diego-based DataQuick.
Last month’s median was the highest since it was $447,000 in August 2008.
The median’s low point for the current real estate cycle was $290,000 in March 2009, while the peak was $665,000 in June/July 2007. Around half of the median’s peak-to-trough drop was the result of a decline in home values, while the other half reflected a shift in the sales mix.
“Some of today’s stats are similar to what we saw in the thick of the housing downturn back in 2009, only in reverse: Instead of foreclosure resales soaring they’re waning, and instead of high-end sales slumping they’re posting some of the larger sales gains. This is one of the main reasons that various price measures are pointing higher – a so-called change in market mix. While last month’s jump in the median sale price might to some extent reflect prices edging a bit higher in certain markets, mostly it’s a reflection of the change in market mix. Fewer discounted distressed properties changing hands, more normal sales in the move-up range,” said John Walsh, DataQuick president.
A total of 8,577 new and resale homes were sold in the nine-county Bay Area last month. That was down 2.6 percent from 8,810 the month before, and up 7.2 percent from 7,998 for June 2011.
Although they’ve increased over the past year, Bay Area sales levels are still below their long-term norm. Since 1988, when DataQuick’s statistics start, June sales have varied from 7,118 in 1993 to 15,735 in 2004. Last month’s sales count was 14.8 percent below the 10,067 average for the month of June.
Last month distressed property sales – the combination of foreclosure resales and “short sales” – made up 36.1 percent of the resale market. That was down from 39.0 percent in May and down from 44.3 percent in June a year ago.
Foreclosure resales – homes that had been foreclosed on in the prior 12 months – accounted for 18.1 percent of resales in June, the first time it’s been under 20 percent since it was 18.8 percent in January 2008. Last month’s 18.1 percent was down from a revised 21.4 percent in May, and down from 26.1 percent a year ago. Foreclosure resales peaked at 52.0 percent in February 2009. The monthly average for foreclosure resales over the past 17 years is about 10 percent.
Short sales – transactions where the sale price fell short of what was owed on the property – made up an estimated 18.0 percent of Bay Area resales last month. That was up from an estimated 17.6 percent in May and about the same as 18.2 percent a year earlier.
Last month 40.9 percent of Bay Area sales were for $500,000 or more, up from 39.4 percent in May, and up from 38.0 percent in June 2011. The low for the current cycle was January 2009, when just 22.7 percent of sales crossed the $500,000 threshold. Over the past 10 years, a monthly average of 47.9 percent of homes sold for $500,000-plus.
Government-insured FHA home purchase loans, a popular choice among first-time buyers, accounted for 16.8 percent of all Bay Area home purchase mortgages in June. That was down from 17.2 percent in May and down from 20.6 percent a year earlier. Last month’s figure was the lowest since the FHA purchase loan share was 14.7 percent in August 2008.
One indicator of mortgage availability remains flat. In June, 14.0 percent of the Bay Area’s home purchase loans were adjustable-rate mortgages (ARMs). That was down from a revised 14.1 percent in May, and down from 16.8 percent in June last year. Since 2000, ARMs have accounted for 49.8 percent of all purchase loans. ARMs hit a low of 3.0 percent of loans in January 2009.
Jumbo loans, mortgages above the old conforming limit of $417,000, accounted for 38.1 percent of last month’s purchase lending, the highest since 38.6 percent in December 2007. It was up from a revised 37.2 percent in May, and up from 34.6 percent a year ago. In the current housing cycle, jumbo usage dropped as low as 17.1 percent in January 2009. Before the credit crunch struck in August 2007, jumbos accounted for nearly 60 percent of the Bay Area purchase loan market.
Last month absentee buyers – mostly investors – purchased 23.4 percent of all Bay Area homes, down from 24.4 percent in May, and up from 20.0 percent a year ago. Absentee buyers paid a median $270,000 in June, up from $262,000 in May and up 13.4 percent from $238,000 a year ago.
Buyers who appear to have paid all cash – meaning no corresponding purchase loan was found in the public record – accounted for 27.5 percent of sales in June. That was down from a revised 28.3 percent in May, and up from 26.0 percent a year ago. The monthly average going back to 1988 is 12.2 percent. Cash buyers paid a median $277,000 in June, down from $280,000 in May and up 11.2 percent from $249,000 a year earlier.
San Diego-based DataQuick monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts. Because of late data availability, sales were estimated in Alameda, San Francisco and San Mateo counties.
The typical monthly mortgage payment that Bay Area buyers committed themselves to paying last month was $1,532, up from $1,491 in May, and up from $1,525 a year ago. Adjusted for inflation, last month’s payment was 45.2 percent below the typical payment in spring 1989, the peak of the prior real estate cycle. It was 59.5 percent below the current cycle's peak in July 2007.
Indicators of market distress continue to move in different directions. Foreclosure activity remains high by historical standards but below peak levels reached over the last three years. Financing with multiple mortgages is low, down payment sizes are stable, DataQuick reported.
(chart)
All Homes #Sold #Sold Pct. $Median Median Pct.
Jun-11 Jun-12 Chng Jun-11 Jun-12 Chng
Alameda 1,584 1,755 10.8% $351,000 $375,000 6.8%
Contra Costa 1,692 1,704 0.7% $268,000 $315,500 17.7%
Marin 313 332 6.1% $650,000 $700,000 7.7%
Napa 118 146 23.7% $310,000 $320,000 3.2%
Santa Clara 1,855 2,011 8.4% $511,250 $550,000 7.6%
San Francisco 533 586 9.9% $665,000 $713,500 7.3%
San Mateo 664 756 13.9% $580,000 $570,000 -1.7%
Solano 707 621 -12.2% $177,500 $200,000 12.7%
Sonoma 532 666 25.2% $299,000 $318,000 6.4%
Bay Area 7,998 8,577 7.2% $377,750 $417,000 10.4%
Source: DataQuick, DQNews.com
