"Move-up" buyers return to Berkeley
The recovery from the housing crisis of the late 2000s has come in several stages. First, some of the distressed properties and foreclosed homes were sold to individuals and investors, which helped the market rid itself of some of the most problematic units. Next, less expensive homes - many of which had seen their values slashed as demand dwindled - were sold to first-time or young buyers. Now, recent data suggests that some parts of the country may be entering a third stage - the return of the "move-up" buyer. The buyers - who are typically looking to upgrade their homes in terms of size or quality - have begun targeting some of the houses for sale in Berkeley.
Looking toward the top
According to a recent article from Mercury News, rising home prices in Berkeley and other parts of the Bay Area suggest that demand in homes - especially those at the higher end of the market - is increasing thanks to renewed interest from people who already own homes. Using data from real estate analytics firm DataQuick, the source reports that the region saw large gains in home prices, especially in the $500,000 and up segment, which jumped 21 percent in a year-over-year comparison.
"More people, at least in the Bay Area, are feeling good enough about the economy, secure enough in their jobs, to step off the sideline and buy a house, particularly move-up buyers," Andrew LePage of DataQuick told the source.
Big gains in Berkeley
This activity has contributed to rising median prices across the Bay Area, particularly in Berkeley, a region with many high-end homes. According to DataQuick, the median price for a home in Berkeley rose 6.92 percent between September 2011 and September 2012. The figure now rests at $607,000, the highest in Alameda County.
These rising prices suggest that the recovery has now reached a new and long-awaited stage. Instead of looking almost exclusively at lower-priced and distressed homes, buyers now appear to be feeling confident enough in the housing market to invest in a more valuable home.
"The bottom of the market is gone," Barbara Lymberis, president of the Santa Clara County Association of Realtors, told the news source. "The sales that are happening are either move-up buyers or people who have been saving their money forever and can afford to buy."