Home prices down in much of East Bay

We are entering new territory when it comes to home sales based on the latest data crunched by the Bay East Association of Realtors.

Experts say what's unusual is that we look to be entering a "normal" real estate market where prices are stable instead of rocketing up. Year-to-year median sales prices are down 9 percent in Oakland, 15 percent in San Ramon and 18 percent in El Sobrante.

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"Homebuyers and home sellers are so used to prices going up year over year it is me that when prices drop a little bit or stabilize, people are freaking out," said David Stark with the Bay East Association of Realtors.

Here's what's going on.

According to data from 34 East Bay cities, many of them had more homes on the market in August when compared to last August. But 21 of them saw prices drop, some by double digits.

With the lower prices, you'd expect increased sales and maybe bidding wars. It was the opposite. Fewer sales and homes sat on the market in 23 of these cities for much longer than usual. A year ago the average home was up for sale for 14 days. Now it's 30 days.

Does that mean bad luck for sellers?

Not really according to Legacy real estate broker Sheila Cunha.

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"Look how rapidly it went up. Let's say we're looking at a more normal market. A year ago there would be multiple offers if I put a handmade for sale sign out front," she said.

Because it required no work or upgrades, she says a house she listed in San Lorenzo went up for sale only 10 days ago and got an offer this morning. The owner is elated. But the agent knows this house would have fetched at least $50,000 more a year ago.

Stark added, "The last time we saw price stability in real estate was during the recession and the short sale and foreclosure crisis. Economic conditions are completely different now. What is driving price stability is buyer behavior and buyer patience."

Bucking the trend of price decreases in the East Bay were Alamo up 5 percent, Walnut Creek up 10 percent, and San Pablo up 19 percent.