Apr 17, 2008 6:13 pm US/Pacific
Bay Area Home Sales Hit 20 Year Low; Prices Tumble
SAN FRANCISCO (CBS 5 / AP / BCN) ―
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A home for sale in San Francisco recently.
AP
The number of Bay Area homes sold in March was the lowest in more than two decades while home prices tumbled 16 percent for the month as potential buyers of expensive homes struggled to get loans, a research firm said Thursday.
The median price of a home in the nine-county area was $536,000 in March, down from $639,000 in March 2007 and down 19.4 percent from the peak of $665,000 last summer, according to DataQuick Information Systems.
The numbers reflect difficulty among wealthier buyers to obtain mortgages over $417,000, known as jumbo loans, said DataQuick analyst John Karevoll. Many potential buyers have six-figure incomes and lots of other assets.
"They're just not getting loans in the jumbo category," Karevoll said. "They can easily afford to buy these homes."
In an effort to stoke demand, Congress recently gave government-sponsored mortgage companies Fannie Mae and Freddie Mac an increase until year-end in the ceiling on mortgages that they can buy or guarantee - from $417,000 to $729,750 in high-cost housing markets.
There were 4,898 new and resale homes and condos sold in the San Francisco Bay area during March, down 41.1 percent from 8,317 a year earlier. That marks the slowest March since DataQuick began keeping records in 1988.
However, March sales were up about 23 percent from February and analysts said the Bay Area has fared better than other parts of the state, including the Central Valley and inland Southern California.
DataQuick reported that Southern California home prices plummeted 24 percent in March to a four-year low.
DataQuick president Marshall Prentice said that other parts of the state have been hit harder by the downturn in the housing market and it appears as though people in the Bay Area are waiting for the mortgage markets to reopen.
"Most of the distress is in areas that absorbed spillover activity during the 2004 and 2005 frenzy," said Prentice. "It still appears that a lot of Bay Area activity is just on hold, waiting for the mortgage markets to open back up."
Alameda County experienced the greatest decrease in home sales between this March and March 2007, a 47.2 percent drop, while Contra Costa County had the greatest decrease in median price paid for a home, with the March price reported to be at $420,500, down from $575,000 in March 2007.
Although March home sales in San Francisco decreased 20.6 percent from March of last year, it was the only Bay Area county to experience an increase in median price, a slight bump to $755,000 from $753,000 in March of 2007.
(© CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. The Associated Press and Bay City News contributed to this report.)
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