NorCal home sales drop 20 percent in Sept.

In this July 13, 2010 photo, a sign announces a residential home sale is pending in the Boston suburb of Marborough, Mass. The number of buyers who signed contracts to purchase homes dropped in June, as the weak economy and tight lending standards kept consumers away from the housing market. (AP Photo/Bill Sikes)
October 21, 2010 9:00:04 PM PDT
Despite historically low mortgage rates, home sales fell again in the Bay Area last month. They're down more than 19 percent compared with September of last year -- the second worst September in 19 years. There is still a fear out there of buying new homes.

According to DataQuick, it's the second slowest September in nearly 20 years for home sales in the Bay Area -- 27 percent below average.

"Sales are down, people are a little apprehensive about what's happening in the economy," says Ruhi Alikhan, a realtor in the Campbell-Sunnyvale area.

She does see a fair number of buyers, still on the fence, even though interest rates remain quite low.

"People are uncertain, job security and you know just with what's happening in the economy, the elections...but people are still buying," says Alikhan.

There is a certain schizophrenia in the market. One Sunnyvale property sold above asking price with multiple offers, while others languish. Realtor Vickie Nagy believes the low overall sales numbers are partly due to a backlog of pending short-sales. A short-sale is the sale of a home for less than the amount owed on the loan.

"Our backlog of pending listings includes 48 percent short-sales. We have homes that are rolling around as short-sales that just won't close," says Nagy.

San Ramon's Tom Baker wants to buy and has put in offers on homes that are in short-sale.

"We put an offer on these short-sales, go through the agreements with the banks, get the agreement and then at the last minute, the people say 'Ah, it's not really for sale. We want to file bankruptcy, so we can live here for another nine months,'" says Baker.

While sales are off, prices have gone up some in the Bay Area. In Sept. 2009, the median sale price of a home in the Bay Area was $395,000, compared with Sept. 2010 at $365,000 -- an increase of 8 percent.

That's still well off the median price at the height of the market in July 2007 of $665,000. The $365,000 is 40 percent lower.


Load Comments