Bay Area home sales fall to 5-year low; prices still rising

Silicon Valley/San Jose Business Journal - by Sharon Simonson

The pace of home sales continues to slide in Santa Clara County with 268 fewer homes and condos, or 14.2 percent, trading hands last month than in February 2005, according to numbers released Thursday by a Southern California company.

Despite the slowing, the median price of the 1,614 homes sold countywide rose 14.5 percent to $663,000, DataQuick Information Systems said.

That compares to a Bay Area median of $616,000, up 12.2 percent from the same month a year ago.

DataQuick uses public records to reach its conclusions.

Home sales in the nine counties typically identified as the Bay Area regional housing market were at their lowest level in five years with 6,206 new and resale homes and condos changing hands. That compares to 7,463 in February 2005, though it was up about 200 units from January's threshold.

The slackening pace does not spell doom to him, said Marshall Prentice, DataQuick president, in a prepared statement.

"We'll know more about what's going on once next month's numbers come in," he said. "March sales have a more typical purchase pattern than February's or January's. Right now we don't see anything ominous in the numbers, just a real estate cycle that is past the frenzy phase."

Foreclosure rates, while rising, are not above normal, the company said. Adjustable-rate mortgages are also declining in popularity among Bay Area buyers, and down-payment sizes are stable.

Fred Hibbert, a Coldwell Banker managing broker who tracks weekly sales data across Santa Clara County for the company, said the year has begun differently than is typical, with sales clearly slowing and fewer sellers coming into the market. The number of homes pulling multiple offers has also fallen below 50 percent, he estimated.

Still, he said, "Good locations and property presented properly still draw lots of interest."