The Bay Area Housing Market Remains Fundamentaly Off Kilter

by Andy Kaufman on March 18, 2010

The new Dataquick report for the Bay Area housing market came out today and if you’re looking for some good news, there’s not much in there for you. While prices are still holding their ground, the sales volume is down and financing still hard to get.

“The sales and price data remain choppy, with more ups and downs and inconsistencies than we’d typically see. It’s partly the season – January and February are often atypical and don’t serve as good barometers. But it’s more than that. The market remains fundamentally off kilter. There’s still relatively little lending going on in the upper price ranges, and little adjustable-rate financing, which had been vital to the Bay Area. Investor and cash-only deals remain well above normal, as does the level of sales involving distressed property,” said John Walsh, MDA DataQuick president.

“Despite the widening stability seen in the housing market in recent months, the outlook remains murky,” he said. “Whether prices will firm, or remain firm, will depend largely on three factors: The market’s response as the government reduces its housing stimulus, the economy’s ability to gain traction, and the decisions that lenders and borrowers will make in countless distress cases. The key question is how much more distressed inventory is coming, and when.”

That indeed IS the key question and it’s something that we’re constantly tracking, so stay tuned for more news from the trenches.