Following national real estate market trends, home prices along the Peninsula ticked up slowly from the year prior according to reports detailing measured growth in an industry showing signs of cooling.
Home prices increased nationally by 3.6% from August 2018, according to a report released Tuesday, Oct. 1, by property databank CoreLogic, which projects 5.8% growth over the coming year.
It’s not doom and gloom for those feeling the sting of a rising costs though, according to CoreLogic’s chief economist Frank Nothaft who said the national growth rate is notably less severe than years prior.
“The 3.6% increase in annual home price growth this August marked a big slowdown from a year earlier when the U.S. index was up 5.5%,” said Dr. Frank Nothaft, in a press release. Nothaft expected the slowed growth would be most appreciated by first-time home buyers.
Home sale prices on the Peninsula increased over the past year as well, according to a San Mateo County Association of Realtors report showing the median sales price in August stepping up marginally. The report showed the median sales price hitting $1.54 million, up about $40,000 from the same time last year. The flat growth experienced marks a significant departure from August 2017, when the median sales price was $1.375 million and August 2016, when it was $1.255 million.
The local market’s annual peak was reached in May, when median home sales prices rose to $1.76 million — nearly equaling the $1.8 median sales prices struck in April 2018, which is the most expensive ever recorded in the county.
Sales activity in the local market has slowed down as well, as the most recent report suggests 340 homes sold across the county in August, down from 373 sales the year prior, 381 in 2017 and 411 in 2016, according to the SAMCAR report. There are also more homes on the market than in the recent past, as there were 527 homes listed in August 2019, up from 415 the same time of year in 2017.
Further illustrating activity on the local industry slipping, the SAMCAR report showed properties sat on the market for an average of 33 days in August, up from an average of 25 days the two months prior.
The apparent market softening comes on the heels of a CoreLogic report earlier this summer which suggested the Bay Area’s median home sales price ticked down marginally from the year prior — by $1,000 to $830,000 — for the first time since 2012. The most recent report indicated the region’s single-family home prices increased by 1.9% over the last year, in area spanning from San Francisco to Redwood City.
Favorable market trends stand to most benefit millennials, according to the most recent CoreLogic report which suggests the hope of homeownership is growing among the generation of young adults.
“Almost half of the millennials over 30 years old have bought a house in the last three years. These folks are increasingly looking to move out of urban centers in favor of the suburbs, which offers more privacy and a greener environment,” said CoreLogic CEO and president Frank Martell in a prepared statement, citing a recent company survey. “Perhaps most significantly, almost 80% of all millennials are confident they will become homeowners in the future.”
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