Contra Costa Real Estate

:: Market Conditions ::

Posted on Tue, May. 21, 2002

Prices surge in demand for houses in Bay Area
Median $402,000 sale is a record; 2,208 homes sell in Alameda County in the past month, plus 2,115 in Contra Costa
By Kelly Smolen
CONTRA COSTA TIMES

Home sellers once again seem to be calling all the shots in the East Bay real estate market.

So suggests a report released Monday by San Diego-based DataQuick Information Systems.

Despite regional economic woes, DataQuick reported skyrocketing East Bay sales. In Contra Costa County, 36 percent more homes -- newly built, resale and condominiums -- were sold last month than in April 2001. In Alameda County, 51 percent more were snatched off the market.

Also headed back into the stratosphere are prices. During April, the Bay Area's median price was $402,000, up 6.3 percent from April of last year and the highest on record in DataQuick's decade-plus history of tracking this data. The last peak was in March 2001 at $386,000.

Contra Costa County posted the Bay Area's largest percentage gain, with the median price climbing 12.6 percent from last April to $330,000. In Alameda County, the median value jumped 3.3 percent to $380,000 during the same period.

Experts say a couple of key factors are behind the recent housing surge: still-low mortgage interest rates and a white-hot demand to live here, which is outstripping supply.

Jonathan and Jeri Corbett, both 29, feel the pain of not enough to go around. A bidding war on a Concord duplex about a month ago dashed couple's dream of buying their first home. More importantly, it sobered them to the reality of seizing a foothold in an elusive market.

"I was pretty much devastated," said Jonathan Corbett. So devastated that the couple are cobbling together help from family sources to approach their next deal as cash buyers. They are bidding on another duplex in Concord's Live Oak subdivision with an asking price of $360,000. Their first choice came on the market for $337,000 and sold for $376,000.

"The market is a little out of hand," said Lynn Brewer with Executive Brokers in Walnut Creek, who is working with the Corbetts.

The run-up isn't the East Bay's alone. The Bay Area, the state and most of the country are experiencing deep appreciation and strong sales, said John Karevoll, a DataQuick analyst.

In the nine-county Bay Area, 10,768 homes were sold in April, an almost 50 percent increase from April 2001. Last month's sales jump was the fourth in a row following 13 months of consecutive declines.

The latest statistics are contrasted to last year's "poky post-dot-com fallout," Karevoll said.

Not everyone is celebrating, though. There's a growing number of cash buyers opening their checkbooks, said Brewer, a fact that's going to make it tougher for those chasing the American Dream. "The average Joe cannot buy."

Other East Bay real estate professionals agree that the local market has gained steam but cast a more tempered light on their territories.

Louisa Reesor with the El Cerrito office of Prudential California Realty said there's no "feeding frenzy" in Western Contra Costa. However, communities that typically harbor buyers thwarted from Oakland, Berkeley and Central Contra Costa, have seen several outside-the-norm deals completed.

For instance, she said, in March in Richmond, a $239,000 listing went for $270,000, and a $200,000 listing fetched $250,000. In late April, a $519,000 El Cerrito listing sold for $628,000. Hercules corralled a $540,000 closing last month, she added.

Tom Ivarson, a broker with the Pleasanton office of Coldwell Banker, said that while buyers are back, they're cautious. He recently handled a Tri-Valley listing for $539,000, which landed a $560,000 price. Most deals, he explained, are happening in the $500,000 to $1 million range.

However, what's about to turn in the Tri-Valley market is premium home sales, Ivarson predicted. The area, because of its proximity to the Silicon Valley, typically mirrors what's going on there.

Palo Alto saw a spike in its high-end market in the past 30 to 60 days, a pattern that's going to travel north to the crossroads of Interstates 580 and 680, he said. Look for the $1.5 million and higher segment to start picking up soon, he said.

That will buoy Alameda County's luxury home sales, which sources say have not been as brisk as Contra Costa's. "Those are different buyers (in Contra Costa)," said Ivarson. "They work in San Francisco and didn't just lose their start-up companies and $20 million along with it."

Kelly Smolen covers commercial and residential real estate. Reach her at 925-847-2129 or ksmolen@cctimes.com.
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Bay home sales soar
Activity rises 50 percent over 2001
By Marc Albert - Business Writer

Posted on Tue, May. 21, 2002

Home buyers snapped up Bay Area dwellings at a near-record pace in April, boosting activity by nearly 50 percent over last year and sending the region's already staggering sale prices into record territory, a real estate information service said Monday. Home sales volume rocketed up 49.7 percent in April with 10,768 homes changing hands in the nine-county region compared to 7,193 a year ago, according to DataQuick Information Systems, a real estate information service.
Last month's sales count was the highest monthly total since August 2000, and the strongest April in three years.

April's year-over-year increase was the fourth in a row, after thirteen consecutive monthly declines.

The impressive numbers aren't considered that remarkable because last year was quite poor. Buyer enthusiasm evaporated when tech stocks tanked and layoffs spread economic uncertainty.

"Last year's declines in Bay Area real estate were mostly a correction of the excesses of 1999 and 2000. Right now, the market is back in balance," said Mike Ela, DataQuick's president.

The median price of a Bay Area home selling in April was $402,000, shattering the previous record of $386,000 set in March 2001.

The median price is the point where half of the homes sold for less and half sold for more.

The figure includes new and existing single-family homes and condominiums and homes sold by owners or transferred as gifts or at sharply reduced prices between relatives.

-byline-comparison, the median price for a single-family Bay Area home sold by Realtors was $507,430 in March, the most recent figure available from the California Association of Realtors.

CAR said the median price statewide in March was $305,940. The median sales price of an existing home nationally was $153,000 in March, according to the National Association of Realtors.

According to DataQuick, in Alameda County 2,208 homes changed hands, up 51 percent from 1,462 a year ago and 0.9 percent from March. The median price of a home jumped to $380,000 in April, gaining 3.3 percent from a year earlier and up 4.68 percent from a month ago.

Sales in San Mateo County soared up 76.8 percent from a year ago with 937 homes changing hands. Though high, the county's activity was eclipsed by Santa Clara County, which posted an 80.9 percent increase. San Mateo County's median price grew by 6 percent to $528,000 in April from a year ago, and was up 4.97 percent from March.

In Contra Costa County,

2,115 homes sold in April, up 36 percent from 1,462 a year ago and 0.38 from the previous month. The median sales price jumped to $330,000, a gain of 12.6 percent from a year earlier. It was the largest percentage increase in the nine-county region. The median was up 8.9 percent from March.

Activity in the local market may be pushing prices higher. The median figure of $402,000 in April was up 5.5 percent from a month earlier and up 6.3 percent from a year ago, suggesting much of strength has occurred this spring.

"April was incredibly hot," said Matthew Greenberg, a broker with FLAG Enterprises in Redwood City, "but it has slowed down a little. It's still a pretty strong seller's market."

Greenberg offered as an example a home listed by another agent at $800,000 that languished on the market without a single offer for eight straight months. When he listed the same house in April, he said, "I had three offers in one week and it sold."

A Berkeley Realtor said the deluge of activity was discouraging first-time buyers and those needing more affordable homes. The Realtor said multiple offers on homes are pushing aside many less-affluent buyers.

The California Association of Realtors, in a recent report comparing wages, interest rates and home prices, showed that housing affordability -- the percentage of households that could afford to buy a median-priced home in their county of residence -- had declined sharply.

Statewide 29 percent of households could afford a median-priced home in March, compared to 34 percent a year earlier.

Contra Costa County was tied with San Francisco as the least affordable area statewide at 12 percent.

San Mateo County was at 18 and Alameda County at 24 percent. Though low, both figures were improvements over a year ago.

Marc Albert can be reached at (510) 208-6414 and malbert@angnewspapers.com .