Bay Area Prices Continue to Rise

The median price paid for a home in the nine-county San Francisco Bay Area in May was $519,000, up 1.8% from $510,000 in April and up 29.8% from $400,000 in May 2012, according to DataQuick. That was the highest median since March 2008, when it was $536,000.

The median price peaked at $665,000 in June and July 2007, before dropping to $290,000 in March 2009. While the median is still 22% below the peak, it has made up about 61% of its peak-to-trough loss.

DataQuick said much of the median's ups and downs can be attributed to shifts in the types of homes sold. When adjusting for these shifts, it appears that about three fourths of the year-over-year rise in the May median sale price reflects an increase in home values, while the rest was market mix.

“In a year or two, we’ll probably see in hindsight that a bounce off the bottom was faster and easier than later incremental gains in a more balanced market. As it is, today’s market is still re-establishing equilibrium. Among potential buyers there is clearly a sense that favorable factors are lined up right now in a way they may not be in a year, or three or five years,” said John Walsh, DataQuick president.

Jumbo loans, those above $417,000, accounted for 47.7% of last month’s purchase lending, up from a revised 47.6% in April, and up from 37.2% a year ago.

Adjustable-rate mortgages accounted for 14.5% of the Bay Area’s home purchase loans in May, up from a revised 14.3% in April, and up from 14.2% in May last year.

Federal Housing Administration-insured loans made up 12.3% of all Bay Area home purchase mortgages in May, up from a revised 12.0% in April and down from 17.0% a year earlier.

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