by Calculated Risk on 8/19/2008 04:25:00 PM

From DataQuick: Bay Area home sales climb above last year; median price falls hard

Bay Area home sales eked out their first year-over- year gain since early 2005 last month as buyers responded to price cuts and snapped up more inland foreclosures. The median sales price dove to a 53- month low, a real estate information service reported.

A total of 7,586 new and resale houses and condos sold across the nine- county Bay Area in July. That was up 5.7 percent from 7,178 in June and up 2.2 percent from 7,423 in July 2007, according to San Diego-based MDA DataQuick.

July sales were the highest for any month since June 2007 and marked the first annual sales gain for any month since January 2005. However, last month's sales still fell 22 percent short of the average July sales total since 1988, when MDA DataQuick's statistics begin, and were the second- lowest for a July since 1995.

Sales of distressed properties played a major role in most areas logging annual sales gains last month.

Foreclosure resales -- homes sold in July that had been foreclosed on in the prior 12 months -- made up 33 percent of all resales. That was up from 29.9 percent in June and 4.2 percent in July 2007. Foreclosure resales ranged from 4.6 percent of the resale market in San Francisco to 65.9 percent in Solano County.
...
"So much of today's market is driven by distress. Unless interpreted in that context, the stats give a rather distorted view of the overall market. We know one-third of the Bay Area's resales in July were homes fresh off foreclosure. Who knows how many more involved a desperate seller and a lender who accepted a short sale," said John Walsh, MDA DataQuick president.
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[T]he Bay Area's median sales price down to $470,000 in July. That was 3.1 percent lower than $485,000 in June this year and 29.3 percent lower than the peak $665,000 median reached in July and June of 2007.

The median has not been lower than July's since March 2005, when it was $469,500.
emphasis added

The median price is being distorted by the mix of homes being sold. Since most of the foreclosures have been at the low end, and the foreclosure resale market makes up 33% of all sales, the median price has fallen sharply. A better measure of price is a repeat sales index like Case-Shiller.