Foreclosure & Bank Owned Properties Fueling Home Sales

In many parts of California's East Bay (Alameda & Contra Costa Counties) foreclosure & bank owned property (REOs) represent more than half of homes being sold. While property values still struggle overall, we are seeing improvement in some areas like Walnut Creek, Lafayette, Orinda, and Blackhawk.

In September of 2007, the bottom fell out of the jumbo loan market. Since then, the declining values in the upper end of local markets has been pushing down median home prices. While challenges still exist in the jumbo market, there has been enough stability in the jumbo market to bring some stability to home values in the upper end of the market.

California's housing market is improving faster than the national housing market.

This chart shows the estimated figures for 2008 and the forecast for 2009. The huge drop in median home price in 2008 reflects the drop in the upper end of the market. The upper end of the market kept the median home price fairly stable in 2007 as home values in the lower end of the market declined.