CALIFORNIA - Bay Area housing market posts strong September

REAL ESTATE NEWS

By Pete Cary

Despite two years of double-digit increases that have home prices approaching previous peaks, there's still plenty of demand for single-family houses, condos and townhouses in the nine-county Bay Area, according to the latest snapshot of the region's booming real estate market.

A total of 7,141 sales of all types of homes were recorded in the strongest September in five years, the real estate information service CoreLogic DataQuick reported Tuesday. That was an increase of 4.2 percent from a year ago. The median sale price of $604,000 was up 14 percent in one year, but still below the peak of $665,000 reached in June and July 2007, just before the housing crash.

A sold sign is posted in front of a home for sale on July 30, 2013 in San Francisco, California. (Justin Sullivan/Getty Images)

Not every county reported such strong sales. Santa Clara County sales were down slightly from a year ago, probably depressed by a combination of high prices and a shortage of homes for sale. That contrasted with five-year September highs in Contra Costa and Alameda counties, and a three-year high in San Mateo County, the Irvine-based real estate information company reported.

Around the Bay Area, buyers are on the hunt, especially for single-family homes in desirable locations.

"I know the buyers are out there," said Myron Von Raesfeld, president of the Santa Clara County Association of Realtors. "We're still getting offers on all the properties we have. I think the challenge we have is extremely low inventory."

For Veeresham Merugu, a software engineer who sold his townhouse in Fremont in August and is looking for a single-family home in the Union City-Fremont area, it's been hard. "I'm not finding the house I want to buy," he said. "Low inventory is what I see." He's renting and said he plans to take his time looking.

"Everyone's holding back" on putting their homes up for sale, according to his agent, Steve Dhillon of RE Realty Experts in Fremont. And buyers are taking their time, he said. "There is a lot more negotiation, and we're not getting bidding frenzies, but at the same time there isn't much to choose from."

On the positive side for buyers, prices have remained relatively flat for several months following a two-year run, according to Andrew LePage of CoreLogic DataQuick.

"Overall, prices haven't moved a lot," he said. "For someone looking to buy, that's good news."

Still, prices are at their peaks or near them in many parts of the Bay Area. The median sale price paid for a single-family home -- the point at which half of the homes are more expensive and half are cheaper -- across the nine-county Bay Area was $635,000, up 10.2 percent from a year earlier.

Alameda saw a price gain of 8.5 percent to $621,000 from a year earlier. Contra Costa County was up 9.8 percent to $450,000; Santa Clara County was up 7.3 percent to $775,000, and San Mateo County was up 16.2 percent to $870,000.

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Those high prices have some agents and brokers worried. Every price gain potentially means some buyers will drop out of the market.

"Affordability is a huge factor," said Jennifer Branchini, president of the Bay East Association of Realtors. "It's changing who's buying." First-time buyers and those who graduated a few years ago with college loans and debt are increasingly unable to buy anything, she said.

"It's tough being a buyer and tough representing a buyer," said Kathleen Callahan, a broker with McGuire Real Estate in Berkeley. But as expensive as homes have gotten, buyers in Berkeley are getting more house for their money than in places like Silicon Valley and San Francisco, she noted. "Some are happy to pay it, others not so happy but have to do it anyway."

Absentee buyers -- usually investors -- accounted for 19 percent of all Bay Area home sales. That was up slightly from August, and down from the previous September.

Buyers paying all cash made up about a fifth of all sales.

The typical monthly mortgage buyers committed themselves to was $2,340 for all types of homes, CoreLogic DataQuick said.