Well, as costs continue to rise, they affect the sales volume in the Bay Area. Marin was one of the only two areas in the Bay Area not negatively affected, as the following will show.
August home sales activity in the Bay Area posted another notable decline from a year ago, with sales down by 11 percent and across most counties. With the substantial August decline, year-to-date sales are now 2 percent below last year. Marin and Napa were the only two counties that saw sales increase from last year, which is a positive improvement from declines recorded in previous months. Alameda, Contra Costa, and San Francisco counties, which were faring relatively better this year, also posted sales declines in August, with activity in Alameda down by 13 percent and sales in San Francisco down by 4 percent.
Sales of homes priced above $1 million also posted slower growth than earlier in the year, up by 8 percent from last August. Nevertheless, sales of homes priced between $2 million and $3 million came to a screeching halt in August after 18 consecutive months of year-over-year increases. Almost the entire decline came from the drop of sales in that price range in Santa Clara County. Other counties, particularly San Francisco, continued to post more sales of homes priced between $2 million and $3 million. By contrast, sales of homes priced between $1 million and $2 million and above $3 million continued trending higher than last year.
Contra Costa was the only county where declines in sales spread across all price ranges. In Marin County, the previous two months of declines in sales of homes priced less than $3 million reversed in August and showed, improvement over last year. Also, San Francisco and San Mateo counties continued to show strong growth in all price ranges in which inventory was available. Lastly, sales of homes priced higher than $3 million showed slower increases or declines in some areas after three months of solid improvement.
Even with the slower increase in August, year-to-date sales are 32 percent above last year, with all counties except Marin and Napa seeing strong increases. Marin County has generally had a comparably slower increase in sales activity since the beginning of 2018 than other counties, while Napa is the only county to register an overall decline compared with last year.
Bay Area inventory conditions continued to improve in August, marking the second straight month of year over-year increases. Eighty percent of the overall 5 percent supply increase came from Santa Clara County, followed by Sonoma and Alameda counties. In Santa Clara County, inventory rose by 20 percent, while Sonoma and Alameda counties saw supply increase by a respective 15 percent and 7 percent. The other counties either showed a small increase or a decline. San Francisco continued to post a large annual decline in the number of homes for sale. Figure 3 summarizes inventory changes by region and price range. The buildup in inventory was primarily in the $1-million-to-$2 million range in Santa Clara and Alameda counties, though a few other counties saw some gains. Overall inventory was up by 20 percent for $1-million-to-$2 million homes, up by 12 percent for $2-million-to-$3-million homes, and up by 4 percent for homes priced higher than $3 million. The most affordable inventory continued to decline in all regions but Sonoma County, where the supply of homes priced below $1 million increased by 23 percent .
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