Bay Area Real Estate: Rich Getting Richer

(Per Chronicle)

There are clear signs that the Bay Area housing market has peaked.  While median prices have declined in only a few counties, increases were in the low single-digits.

The number of units sold has fallen by 11-13%, indicating that deal prices would have actually declined if owners were motivated to sell.

The low-end of the market has slowed, but the high-end is still going strong (hence the distinction between the median and average prices). [bold added]

while Bay Area home sales were about 5% lower than last year’s second quarter, sales of homes above $3 million surged, bringing them in line with last year’s historical peak.

Peninsula Realtor Ken DeLeon noted that foreign buyers, especially from China, are still active in the $10 million-and-up range. However, their purchases of homes in the $2 million to $4 million range “has tapered off, almost to zero,” The imposition of more stringent capital controls has made it hard for most people to get money out of China, unless you’re “uber wealthy,” DeLeon said. Most Chinese buyers purchasing high-priced homes in the Bay Area are doing it through their companies, he added.

In related news about the high-end, the median home price in Atherton has risen to $8.1 million, nearly double the tony towns of Hillsborough and Los Altos Hills.

A business colleague bought a house in Atherton in 1975 on a junior executive's pay (about $50,000). He was fond of telling me (bragging?) at the time that he was making more on price appreciation than from his salary.

Here's hoping that John held on (or traded up!).