Housing markets in the San Francisco Bay Area continued to gain steam in June, with the median sales price rising 7.9% year-over-year to $908,740 and edging up closer to the million-dollar mark.
Compared to May, the median sales price was up 1%, according to a report Monday from the California Association of Realtors.
The city of San Francisco and three out of the eight surrounding counties, namely, Marin, San Mateo and Santa Clara, already joined the million-dollar club, where median home prices ranged from $1.2 million to $1.5 million in June.
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As the technology capital of the world, the Bay Area’s housing markets have benefited from an ever-booming technology sector, said Joel Goodrich, a veteran agent with Coldwell Banker Residential Brokerage based in San Francisco.
"It has also caused a ripple effect," he said. "Other industries affected by technology all move into the area, and their employees are snapping up homes."
The technology sector in the U.S. had a steady rally over the last 12 months, as indicated by the tech-heavy NASDAQ Composite, which has soared more than 25% to more than 6,344 points, from 5,055 points a year ago.
Meanwhile, the number of sales in the San Francisco Bay Area grew 6.1% year-over-year, according to the California Association of Realtors.
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On the supply side, there is a long-standing shortage in the area. As of June, the sales inventories of San Francisco, San Mateo and Santa Clara were 1.7 months, 1.4 months and 1.3 months, respectively, according to the California Association of Realtors.
The inventory index measures the number of months needed to sell the supply of homes on the market at the current sales rate. Generally, less than six months of inventory represents a shortage of supply in the market.
Statewide, the median resale price increased 7% from last June to $555,150, the highest level since August 2007. The total number of sales was 443,150 units in June, up 3.3% from a year ago.
"A lack of available homes for sale continues to be the largest single factor influencing California’s housing market," said Geoff McIntosh, president of the association, in the report.
Active listings throughout the Golden State fell 13.5% from last June, representing a continuous two-year shrinkage and the lowest inventory level this year. At the county level, 39 of 51 reported counties experienced a drop in the unsold inventory index compared to a year ago.
The statewide inventory was 2.7 months in June, compared to 3.2 months a year ago.
"Would-be sellers aren’t listing their homes as many of them would also face an inventory challenge if they were to turn around and buy another property," Mr. McIntosh said.
In addition, the median resale price was also pushed up by the type of homes selling. Homes sold in June were primarily in the mid-to-higher-end price ranges. More affordable starter homes actually saw a sharp drop in sales, according to Leslie Appleton-Young, the association’s chief economist.