Northern California’s high-end and luxury Real Estate markets
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Fourth quarter sales of high-end and luxury-priced homes in seven
Northern California counties served by Alain Pinel Realtors exhibited a mix of stabilized pricing overall, with luxury-classed homes selling for greater median prices in six of seven counties while median prices declined in most of the counties at the high-end of the housing market. Inventory, which is often a precursor of future activity, was all over the place in the fourth quarter and depending on price points, higher in some counties and lower in others, according to the Distinctive Homes & Estates fourth quarter report by Alain Pinel Realtors.
The information in this report is based on public records researched from the leading multiple listing services in San Francisco, San Mateo, Santa Clara, Santa Cruz, Monterey, Contra Costa and Alameda counties and compiled specifically for Alain Pinel Realtors by TrendGraphix Inc., a leading real estate information services provider based in Sacramento.
Overview $1.5- $2.499 High-end Market
For homes listed from $1.5 million to $2.499 million, San Mateo was the only county among the seven counties tracked by Alain Pinel Realtors to experience a decline in inventory during the fourth quarter, by dropping 11.54 percent from 78 homes listed at the end of 2005 to 69 homes listed at the end of 2006. In this price range, Santa Clara County’ inventory increased the least at just 1.58 percent (from 190 to 193) during the same period.Meanwhile Contra Costa County inventory climbed a dramatic 73.33 percent in the fourth quarter 2006 compared with the same quarter of 2005, or 130 listings versus 75 a year earlier. Prices slipped modestly during the period, based on sold median figures for homes from $1.5 to $2.499 million, in six of seven counties tracked by APR.San Francisco County was the exception with an 8.53 percent media price increase from $1.7 million during the fourth quarter 2005 compared with $1.845 million during the final quarter of 2006. Alameda’s median sales price fell only .32 percent, Monterey County’s just 1.5 percent and Santa Clara County’s declined 2.54 percent, while Contra Costa’s fell 4.28 percent, San Mateo’s was off 4.45 percent for homes sold between $1.5 million and $2.499 million, and Santa Cruz homes priced from $1.5 million to $2.499 dropped 4.85 percent.
The most dramatic change by category for homes sold between $1.5 million and $2.5 million was in unit count – far fewer homes sold in this price range during the fourth quarter of 2006 compared with the fourth quarter of 2005 – except in Santa Clara County. The six counties to experience declining unit sales were San Francisco, San Mateo, Santa Cruz, Monterey, Alameda and Contra Costa, which fell on average 27.41 percent. Unit sales declined the least in Contra Costa County – 15.38 percent during the period (66 sold in 4Q06 vs. 78 in 4Q05), while Monterey County’s unit sales declined the most at 39.58 percent (29 in 4Q06 vs. 48 in 4Q05).
Unit sales increased a modest 6.08 percent Santa Clara County during the period, with 208 sales from $1.5 million to $2.499 million during the fourth quarter 2006, compared with 195 in the same period of 2005. Perhaps the surging stock market and low unemployment figures in the Silicon Valley’s core county account for the exceptional sales performance.
Overview $2.5 and greater Luxury Market
For the category of “luxury” homes priced at $2.5 million and greater in the seven counties tracked by Alain Pinel Realtors, San Francisco exhibited the greatest fourth quarter improvement on a year-to-year basis while Contra Costa proved to be the weakest link in the quarter, as measured by the relationship between inventory and units sold.
Inventory of luxury-priced homes declined in San Francisco 35.71 percent, with just 18 homes on the market compared with 28 at the end of 2005, while more homes sold in the county for the period – 31 versus 27 in the fourth quarter 2005, for a gain of 14.8 percent. Contra Costa County, meanwhile, had more inventory of homes added to the market above $2.5 million – 60 at year-end 2006 compared with 41 at year-end 2005, or a 46.34 percent increase, as unit sales slipped from 10 during the fourth quarter 2005 to seven in the final quarter of 2006, or a 30 percent decline.
The median price of homes sold in this category increased 8.16 percent in Contra Costa County, however, reaching $2.9 million in the most recent quarter versus $2.68 million a year earlier. In San Francisco, the median price was off slightly, or just 3.73 percent, declining to $3.095 million compared with $3.215 million in the fourth quarter 2005. In Monterey, Santa Cruz, San Mateo, Santa Clara and Alameda counties, the data was mixed concerning movement in inventory and unit sales, with no notable trends.
In general, pricing held steady for homes sold beyond $2.5 million. As noted, San Francisco’s median sales price declined in the quarter, but the other six counties combined experienced positive price appreciation, despite the mixed report on inventory and unit sales, by increasing on average 5.3 percent in the fourth quarter 2006 compared with the final quarter of 2005.
Monterey County had the greatest spike in median home price with plus 10.86 percent, or $3.7 million versus $3.337 million in the fourth quarter 2005. Alameda County’s median price of sold homes gained a modest 1.69 percent, with a median price in the recent quarter of $3 million compared with a median of $2.95 million in the fourth quarter 2005.“The performance of luxury-classed housing sales continues to march to its own beat and seems unaffected by the correction in the general housing market,” said Alain Pinel Realtors President and COO Larry Knapp.
“It’s not necessarily the same story in the high-end market, where inventory appears to be stabilizing after several months of steep increases that ultimately put the breaks on price appreciation. In other words, the markets are behaving normally, with one affected by general market conditions and the other not much, if at all,” he said.
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Posted on: Saturday, December 22, 2007 at 1:19 pm 
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