Marin, Bay Area Home Prices Rise Modestly in August

SAN FRANCISCO BAY AREA, CA — The median cost for a Bay Area home rose slightly in August compared to the same period last year partly due to low interest rates and job growth, according to research firm CoreLogic.

The median price for new and existing single-family homes and condominiums in the nine-county region rose to $675,000 in August, up 5.2 percent from August 2015, according to a monthly real estate report by CoreLogic.

"Job growth, low interest rates, household formation and other factors helped drive sales," said research analyst Andrew LePage.

In Marin County, 289 homes were sold in August for a median price of $925,000. According to the report, that's 16.2 percent less homes than were sold in August 2015, but a 6.6 percent increase in the median home sale price from one year ago. Compared to last month, when 303 homes were sold in Marin County for a median price of $950,000, that's a 4.6 percent decrease in the number of homes sold and a 2.6 percent decrease in the median sale price.

Across the Bay Area, buyers scooped up 8,374 homes in August, up 3.2 percent from last year but 11 percent below the month's long-term average since 1988, when CoreLogic began collecting data for its report.

The Bay Area's median home sales peaked in June this year when prices hit a record $710,000, according to the report.

"The region's median sale price has risen on a year-over-year basis for nearly four-and-a-half years, and while those gains are consistently double-digit — as high as 33 percent — between mid-2012 and mid-2014, they have since been single-digit and fairly steady, averaging about 7 percent over the past two years," LePage said.

The Bay Area's highest price for August was in San Francisco, where the median cost of a home was just above $1.1 million, and San Mateo County wasn't far behind at $1.06 million. Solano County posted the lowest
median price at $385,000 but also the highest percent increase over the same period last year at 13.4 percent, according to CoreLogic.

Additional San Francisco Bay Area Highlights for August 2016 from CoreLogic:

• Homebuyers in the San Francisco Bay Area took out about 4,100 home equity lines of credit (HELOCs) in August 2016. This was up 6.5 percent from July 2016, but down 2.8 percent from August 2015. The approximately 32,100 HELOCs originated in the region during the first eight months of this year marked a 3.2 percent gain from the same period last year. This year's HELOC tally is the highest for the January-through-August period since 2008 when there were almost 40 percent more (45,000). HELOC originations plummeted during the last housing bust, but began recovering a few years ago. This HELOC data reflects loans that are "stand-alone," meaning they were not originated concurrent with a home purchase.
• Absentee buyers, mostly investors, bought 16 percent of all homes sold in August 2016. This was up from 14.2 percent in July 2016* and down from 18.1 percent in August 2015. The absentee buyer share peaked at 28.4 percent in February 2013, and the monthly average since 1988 is approximately 15 percent.
• Cash buyers accounted for 19 percent of August 2016 home sales, up slightly from 18.7 percent in July 2016 and down from 21.5 percent in August 2015. The cash sales share peaked in February 2013 at 32.9 percent, and the monthly average since 1988 is about 15 percent.
• Jumbo mortgages accounted for 33.1 percent of the total number of home purchase loans used in the San Francisco Bay Area in August 2016, down from 34.3 percent in July 2016 and up from 29.1 percent in August 2015. Jumbo mortgages also represented 54.2 percent of the total dollar volume of all home purchase originations in August 2016, down from 55.3 percent in July 2016 and up from 50.2 percent in August 2015. Jumbo mortgages are loans that exceed the "conforming loan limit" which is set by regulation and varies by county. Nationally, the base conforming loan limit for single-family homes is $417,000, but high-cost areas, including most of the San Francisco Bay Area, have higher limits of up to $625,500. A rise in the jumbo mortgage share of home purchase loans can be related to higher home prices, an increase in the share of sales occurring in the market's higher end or the greater availability of funding for jumbo loans.
• Government-insured Federal Housing Administration (FHA) loans accounted for 10.7 percent of home purchase loans in the San Francisco Bay Area in August 2016, down slightly from 10.9 percent in July 2016 and down from 13.2 percent in August 2015. In some of the more affordable stretches of the San Francisco Bay Area, FHA loans accounted for a substantially higher share of home purchase loans. For example, Solano County had the highest FHA share in August at 22.4 percent, followed by Contra Costa County at 21 percent. While the FHA share of all low-down-payment loans – those with a down payment of 3.5 percent or less – has trended lower over the past year, the share of conventional (not government-insured) low-down-payment loans has risen. Overall, the share of loans with a down payment of 3.5 percent or less has increased slightly over the past year, from 18.8 percent in August 2015 to 19.8 percent in August 2016.
• Distressed sales, which include both short sales and real estate-owned (REO) sales, represented 3.7 percent of total home sales in August 2016. This was up from 3.4 percent in July 2016* and down from 4.1 percent in August 2015. Distressed sales peaked in January 2009 at 60 percent. Short sales are homes that are sold for less than what is owed on the property, and REOs are homes that lenders took back through foreclosure and then sold on the open market.

*When necessary July 2016 data was revised. Revisions are standard, and to ensure accuracy CoreLogic incorporates newly released data to provide updated results.

— Bay City News contributed to this report

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