Lower interest rates and a higher number of homes on the market across the Bay Area have caused overall prices to fall for the first time in 13 months.
The median sale price of a single-family home in the nine-county region fell 1.6 percent to $1.24 million year-over-year, the San Jose Mercury News reported, citing figures from the California Association of Realtors.
The typical price was $1.9 million in San Mateo County, $1.85 million in Santa Clara County, $1.53 million in San Francisco, $1.27 million in Alameda County and $841,950 in Contra Costa County.
“With more homes on the market, buyers have more choices,” Barbara Clemons, president of the Bay East Association of Realtors, told the newspaper. “Sellers may have to make some adjustments and be sure that they’re pricing their homes accordingly.”
Across the Bay Area, the number of available homes was at its highest since February last year.
After waiting for months, declining interest rates moved some sellers to finally list their homes.
The rate for a 30-year fixed mortgage has fallen throughout the summer, hitting 6.09 percent in mid-September from a high of 7.22 percent in May, according to Freddie Mac. The Federal Reserve last week cut interest rates by half a percentage point, its first cut in four years.
A jump in inventory helped boost Bay Area home sales, which rose nearly 5 percent from August 2023.
At the same time, homes between a region from south of Gilroy to north of Santa Rosa lingered on the market longer — a median 20 days, up from 14 days a year ago.
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With homes taking longer to sell, “pricing is everything,” Tim Yee, a broker with RE/MAX Gold based in San Jose, told the Mercury News.
“It has been enough of an uptick in inventory that people who are not pricing right are finding it out fairly quickly,” Yee said. “We’re seeing less of people saying, ‘My neighbor sold his place for $2 million, so I should be able to get that.’”
— Dana Bartholomew