Community Corner

Housing Prices in Lamorinda Up 20 Percent From Last Year

Fewer home sales but higher prices mean good news for the housing market.

According to one local realtor, home prices in Lamorinda are up 20 percent since 2012.

Jim Colhoun of Better Homes and Gardens Realty said last week that the number of homes sold in May of 2012 outnumbered the homes sold over the same period this year. Home sales in Lamorinda were down about 10 percent.

“There’s a lot less inventory,” he said. “There are a lot fewer homes for sale. It’s down by at least a third.” 

But more interesting, he added, is the asking price of the homes that are on the market.

The average sale price for a home in the Lamorinda area in 2012 was $938,000. The average sale price this year is $1.15 million.

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“That’s for all homes, from the least expensive to the high-end luxury homes,” Colhoun said.

Another local realtor, John Heinz, said the lack of homes on the market this year is more about the ongoing effects of the 2007 recession.

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“I think what is happening is that many people have homes that are still underwater (they owe more on the mortgage than the home is worth), and they don’t want to sell them right now. As the market surges, you’ll see the homes come on the market. We’ll see more stuff come up and the prices will stagnate. The Bay Area is a pretty transitory area. People don’t hunker down here.”

And what about the concern that the rising real estate prices might signal another bubble like the one in 2007 that nearly brought the country’s financial system to its knees?

“It doesn’t feel like a bubble,” Colhoun said. “You don’t hear people at cocktail parties talking about the two or three homes they bought last week. Interest rates are low, and people are able to move upward, or to buy their first home.”

He said that lenders are being very careful these days to scrutinize would-be borrowers, and most home loans require at least a 20 percent down payment. That is a far cry from the early 2000’s, where borrowers with a sketchy credit history or no money down could easily qualify for a home loan.

“The old days of 105 percent financing are gone,” Colhoun said. “You literally used to be able to get a home loan and get some cash back at the end of the deal.” 


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