San Benito County, Calif., Continues Housing Slump

Home prices in San Benito County, Calif., held steady in February, as the California housing market continues to lag behind where it was a year ago.

Sixteen homes closed escrow last month at a median home price of $585,000, according to the Hollister Free Lance. In February 2006, 24 homes closed escrow, with a median price of $600,000.

Realtors said homes selling between $500,000 and $600,000 dominated the local market. In fact, more than half of the area’s California mortgage loan transactions in February were related to homes in that range.

Dee Brown, a broker with ReMax Platinum Properties, said that most homes for sale seem to be either moderately priced houses targeting first-time home buyers or much more expensive options aimed at buyers who are interested in “moving up.”

“There seems to be almost nothing available in between,” Brown said.

Two-thirds of homes on the market now are listed for less than $700,000. Listings drop off dramatically for homes priced between $700,000 and $1 million, before picking up again for homes listed at $1 million-plus.

But buyers may not be interested - or able to afford a California home loan - for the area’s priciest homes. The costliest home sold last month went for $985,000, while the most expensive home on the market was listed at $2.75 million.

Brown also noted that sellers tend to be settling for less than the asking price, a big change from the housing boom years. Homes sold in February of 2005, Brown said, went for an average of 100.57 percent of the list price.

Last month, homes were sold for an average of 96.07 percent.

The most expensive and least expensive homes sold in February reflected the same trend, even as home loan rates are steady or dropping.

The priciest house, a four-bedroom, three-bathroom “executive-style home” at the Ridgemark Country Club, was listed at $1.075 million and sold for $985,000. The least expensive home, a one-bedroom, one-bathroom “fixer-upper” in Aromas, was listed at $345,000 and sold for $215,000.

Overall, the market continues to lag behind early 2006. Sales totaled $16 million in February 2006, and only added up to $10 million last month.

However, some experts, such as Renee Kunz, manager of the local branch of Intero Real Estate Services, said her office actually saw January’s sales improve over those a year earlier.

“February was at least even with last year,” Kunz added.

Both Realtors reported seeing more people at open houses. Kunz acknowledged that many weren’t serious buyers, but she said that she also sees plenty of people who are very interested in purchasing a home.

The market is likely to pick up in the next couple of months, officials believe. One indicator is that Silicon Valley - which encompasses much of the San Jose housing market - is starting to receive more and more offers.

“As that market picks up, it moves south,” she said.

SOURCE: Hollister Free Lance