Wild, Wild West: Silicon Valley Price Fall Spreads
Roll back the clock two years on Silicon Valley’s housing market.
California’s last major metro holdout in price increases has hit the wall — and hard.
Since the market peaked a year ago, prices are down 11.5 percent, according to the Bay Area Market Newsletter, produced by Creekside Realty broker, Richard Calhoun from San Jose.
Silicon Valley’s median price on single-family homes in closed sales is back where it was two years ago and a whopping $100,000 less than it was when the market peaked a year ago, Calhoun reported.
The region’s April median price for single-family homes came in at $768,000. Two years ago it was $775,000. That median price peaked at about $868,000 a year ago.
For condos, the median price came in at about $496,000 in April this year. Two years ago it was $500,000.
The market’s overall price decline indicates high-end homes are finally beginning to feel the pinch. Starter home prices have been declining for nearly a year, but stronger high-end home sales helped buoy the median price — until recently.
Calhoun said the 1,124 homes sold in April is the third lowest April home sales level since 1998.
Silicon Valley is nearly a full-blown buyer’s market where sellers get an average of only 98 percent of their asking price, compared to more than 100 percent during April in 2006 and April 2007.
That, along with stiff lending requirements thwarting buyers, increasing foreclosures and other market conditions, is pushing prices down.
Zillow.com recently reported half of home buyers who purchased in 2006 owe more than their homes are worth.
Zillow.com also said in about a quarter of the region, the less-populated areas of the northwest, where home prices are higher, home prices are down no more than 3 percent. In the other, greater, more heavily populated areas in the region, where homes are cheaper, some home prices are down by 20 percent or more.
Written by Broderick Perkins for www.RealtyTimescom. Copyright