One California Market Bucks Statewide Trend

Looks like the California housing market is not entirely in shambles.

Bucking a statewide trend, home prices in Union City are on the rise, surpassing Fremont and Newark.

Median home prices in Union City, located in the heart of Alameda County (right), rose for two straight months, the latest figures from the California Association of Realtors show.

Prices also increased over this time last year, the snapshot of monthly single-family, town house and condo sales showed.

• Fremont traditionally has been the most expensive market in the Tri-City area, followed by Union City, then Newark.
• In October, the median home price in Union City was $658,000 — 5.3 percent more than the same time last year and nearly $100,000 more than the state average, and a far cry from the struggles seen in Southern California or even the nearby San Francisco Bay Area.
• In September, the price was $645,000, compared with $583,000 at the same time the previous year — a 10.6 percent increase.

In comparison, the state housing market declined sharply in 2006, which the California Association of Realtors’ chief economist called a “turning point” in an October report.

“The 24 percent decline in sales from January 2005 to January 2006 was a harbinger of things to follow through the year,” Robert Kleinhenz wrote.

For 2006, annual sales are expected to decline 23 percent from the 2005 record of 624,960 homes, as California mortgage demand decreases by a significant amount, he predicted.

During the real estate downturn a decade ago, Union City’s market stayed strong longer than most because affordable prices continued to attract buyers. This is a reason Bay Area home sales are tanking while Alameda exhibits signs of life.

Fremont wasn’t quite as lucky as Union City this time around, however.

Although prices picked up in the 12 months since October 2005, they still were down by 2 percent. But that was better than the 6.9 percent drop, from $655,000 to $610,000, between September 2005 and September 2006.

In Fremont, that means less-costly California home loan payments for those looking for town houses and condos. The high volume and variety of units that Fremont has on the market means opportunities for buyers.

Meanwhile, median home prices in Newark rose slightly, just below 1 percent from $610,000 between October 2005 and 2006, far weaker than the 5 percent boost between September 2005 and 2006.