Continued decline in Bay Area home sales, appreciation rate

February 16, 2006

La Jolla, CA.----Sales of Bay Area homes dropped last month to the lowest level in five years as price increases continued to ease back, a real estate information service reported.

A total of 6,004 new and resale houses and condos were sold in the nine-county region last month. That was down 35.8 percent from 9,347 for December, and down 20.0 percent from 7,509 for January last year, according to DataQuick Information Systems.

A decline from December to January is normal for the season. Last month was the tenth in a row to see a year-over-year sales decline. The January sales count was the lowest for any month since January 2001 when 5,977 homes were sold.

"We won't know for another couple of months if this is a lull in the market or part of a longer-term downturn. It's always difficult to project from trends we see in January and February. The March numbers will tell us much more about what's going on," said Marshall Prentice, DataQuick president.

The median price paid for a Bay Area home was $607,000 last month. That was down 0.3 percent from December's $609,000, and up 13.7 percent from $534,000 for January a year ago. The annual price increase was the lowest since prices rose 13.1 percent to $474,000 in March 2004. It's probable that appreciation will dip into the single digits during the next month or two.

DataQuick, a subsidiary 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.

The typical monthly mortgage payment that Bay Area buyers committed themselves to paying was $2,798 in January. That was down from $2,867 in December, and up from $2,344 for January a year ago. Adjusted for inflation, mortgage payments are 13 percent higher than they were at the peak of the prior cycle sixteen years ago.

Indicators of market distress are still largely absent. Foreclosure rates are coming up from last year's low point, but are still below normal levels. Down payment sizes are stable and there have been no significant shifts in market mix, DataQuick reported.

All Homes	No Sold Jan-05	No Sold Jan-06	Pct. Chg	Median Jan-05	Median Jan-06	Pct. Chg
Alameda	1,503	1,259	-16.2%	$495K	$562K	13.5%
Contra Costa	1,394	1,197	-14.1%	$475K	$570K	20.0%
Marin	309	210	-32.0%	$740K	$741K	0.1%
Napa	164	103	-37.2%	$542K	$596K	10.0%
San Francisco	423	335	-20.8%	$684K	$722K	5.6%
San Mateo	550	450	-18.2%	$693K	$726K	4.8%
Santa Clara	1,862	1,486	-20.2%	$565K	$648K	14.7%
Solano	754	504	-33.2%	$399K	$490K	22.8%
Sonoma	550	460	-16.4%	$482K	$562K	16.6%
Bay Area	7,509	6,004	-20.0%	$534K	$607K	13.7%

Source: DataQuick Information Systems, www.DQNews.com

Media Inquiries: John Karevoll (909)867-9534

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