California housing market posts gains
It's been a few years since the housing bust of the mid-2000s, and with that comes time for recovery. The real estate market has been steadily posting gains in 2012 in metros across the nation. Small cities to the north and large cities to the south are seeing home values increase, property sales improve and foreclosure rates decline.
In California, the recovery is even more apparent. Following the housing bust, many metros in California saw an immediate and severe decline in property values. Homeowners were left under water on mortgages that far exceeded the new value of their home. However, the state of affairs in California is in the process of righting itself. In metros like Oakland, home values are improving and residents are gaining a pep in their step.
According to ALTOS Research, the median price for a single-family home in Oakland was $344,549 as of November 23, 2012. This cost is significantly up from where it was on January 1, 2012, at approximately $225,000. For potential homebuyers considering real estate in Oakland, the median price paid per square foot in the region was about $231 as of November 23, 2012. Knowing the median price paid per square foot in a greater area will allow a potential homebuyer determine whether one property is worth its price tag in comparison to a similar home in the same neighborhood.
Despite the increase in housing prices, potential homebuyers are not taking long to decide whether they are going to purchase a home or not. The source claims that homes listed for sale as of November 23, 2012 only spent about 82 days on the market before a homebuyer completed the closing process. The competition for quality homes is getting fiercer as well as inventory levels in Oakland continue to decrease. There were about 346 properties listed for sale in Oakland as of November 23, 2012.
In comparison to the general California housing market, Oakland is holding its own. According to real estate news and custom data provider DataQuick, the number of homes sold in the Bay Area increase in a year-over-year comparison for the 16th month in a row in October 2012. In addition, the median price paid for both a new and existing property increased for the sixth month in a row.
The median price paid for a home in the Bay Area in October 2012 was $416,000 – down 3 percent from $429,000 in September 2012. However, in a year-over-year comparison property values increased 18.9 percent from $350,000 in October 2011 – the highest annual gain recorded since May 2010 when the median value rose 20.1 percent.
"We’re still watching the market regain the ground it lost after 2007. It’s unclear exactly much of today’s apparent price increase reflects actual growth, and how much reflects a change in market characteristics. The two factors obviously play into each other. We’re definitely seeing less distress and foreclosure activity, and more mid- to up-market sales. Supply is limited, and getting through the mortgage process is still rough," said John Walsh, DataQuick president.
The rate of increase in property values in Oakland is reflecting the steadily improving rates recorded in California. The housing market is gaining mass appeal from potential homebuyers once again as real estate figures continue to post gains, mortgage rates remain low and rents continue to rise.