YOY and MOM price declines finally do kick in (from another corner of Bubble Central). The beginning of the next phase:
Home sales hit 11-year low in Marin
Carla Bova
Median home prices fell in Marin County last month as sales dropped to their lowest level in 11 years.
Marin's median home price was $900,000 in July, down from $971,500 in June and down from $910,000 in July 2005.
The Marin median condo price increased slightly, to $555,000 last month from $546,500 in June, and up from $530,500 in July 2005.
Sales for both homes and condominiums totaled 286 in July, the lowest sales volume since July 1995, when 205 residences sold, according to DataQuick Information Systems, a real estate information service in La Jolla.
July home sales were down nearly 30 percent from July 2005, when 408 sold.
The situation mirrored the Bay Area trend, in which homes sales fell nearly 31 percent from 11,470 in July 2005 to 7,941 in July 2006 - the lowest in 10 years.
"Marin was no exception as the decline year to year was very similar to the Bay Area," DataQuick analyst Andrew LePage noted. "The slowdown under way for many months was just more pronounced in July and we are not sure if it is an anomaly or the beginning of a more similar slowdown. By fall we will know."
LePage said the market is slower in general due to several factors.
"We think a lot of demand that would be played out right now has already been spent," LePage said. "It was spent over the last few years because we think a lot of people rushed to take advantage of low mortgage rates and low interest rates."
Across the state, "It is almost certain the next stage will be that prices begin to drop," said Stephen Levy, director of the Palo Alto-based Center for the Continuing Study of the California Economy. "I think the more expensive homes over $1 million are more vulnerable at this time."
In Marin, 204 single-family homes were sold last month, down 30 percent from June when 292 were sold and down 25.5 percent from July 2005 when 274 were sold.
Condominium sales fell as well. Last month 60 condos sold, down 33 percent from June when 90 were sold - and down 39 percent from July 2005 when 99 were sold.
Real estate broker Patty Cohn, of the Frank Howard Allen Greenbrae office, said the decline in sales is typical this time of year.
"The July closing numbers are actually sales that occurred in June and the real estate market in Marin is traditionally slow during summer months," Cohn said. "I also think that buyers are taking a wait-and-see attitude to see what the market is going to do.
"Buyers see homes are not getting snapped up like hotcakes and want to know whether a house they might buy for $1 million will be worth more or less in five years."
Cohn said she expects sales to go up in September and October.
"The real estate market is not like the stock market in that people still get married, still get divorced, still have babies, still relocate, still retire. People's lives still go on and people make decisions based on their lives," Cohn said. "Over the long-term Marin County is a very stable real estate market. Always has been."
Levy said that generally, "the same thing is going on everywhere."
"Interest rates have gone up, so 1 percent, 2 percent, 3 percent mortgage rates are not available and that takes a number of people out of the market," Levy said.
Levy cited two types of buyers leaving the market.
"The first set is folks who can only buy a house with an exotic mortgage - a very low-rate mortgage or a mortgage where the principle payments were deferred," Levy said. "The second group that left is buyers who were speculating or flipping homes, investors who were not buying to own. When prices stop rising that does not work anymore.
"Prices have stopped rising."
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