DQNews Archived Article

Bay Area Home Prices Level Off

by Real Estate Analyst John Karevoll
October, 2000

La Jolla, CA.— Bay Area home sales remained at near record levels in September, the result of a robust regional economy and growing demand. There are indications that prices may be leveling off, a real estate information service reported.

A total of 6,769 resale houses were sold in the nine-county Bay Area last month. That was down 9.8 percent from 7,501 in August, and down 1.8 percent from 6,892 for September a year ago, according to DataQuick Information Systems.

The decline from August to September is normal for the season. Last month was the third-strongest September in DataQuick's statistics, which go back to 1988. In September of 1988 the sales count was 7,827. So far this year 57,220 resale houses have been sold, 6.3 percent fewer than 61,086 for the first nine months of last year.

"Home buyers are doing the math, and while price is a big part of the equation, so are mortgage interest rates. While Bay Area buyers can obviously still buy, they're closer to their financial edge than buyers in the rest of the state. A jump in interest rates or another surge in prices would bump a lot of potential Bay Area buyers out of the market," said Mike Ela, DataQuick's president.

The median price paid for a resale house in the Bay Area was $371,000 last month. That was down 0.5 percent from $373,000 for August, and up 22.0 percent from $304,000 for September last year. A spring jump in prices moved the median from $358,000 in April to $370,000 in May. It has been at roughly that level since and last month was the first of this year where the median did not set, or equal, a record.

DataQuick, a business unit of Vancouver-based MacDonald Dettwiler and Associates, monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.

Sales of resale houses statewide are also down. Sales last month totaled 33,350, down 2.0 percent from 34,028 for September last year. The statewide median was $210,000, up 13.5 percent from $185,000 last year, DataQuick reported.

Resale houses