Low Inventory and Buyer Demand Pushes Home Prices Higher

Increased demand from first-time homebuyers motivted to purchase a home before the December 1 2009 deadline to qualify for an $8,000 federal income tax credit, and a tighter inventory of entry-level bank-owned properties on the market pushed home prices higher in Alameda county during the fourth quarter of 2009.

The median sales price of a single-family detached home sold during the fourth quarter rose 7 percent from $385,268 in the third quarter to $415,882 - 8 percent higher thant the fourth quarter 2008 of $385,496. The median sales price climbed on a qurter-to-quarter basis in nine of Alameda's 15 markets, and rose year-over-year in seven communities. Oakland showed signs of improvements with a 26 percent year-over-year median price increase.

With fewer bank-owned homes on the market, home sales were down 14 percent in Alameda county from 3,001 homes sold in the third quarter to 2,583 homes sold in the fourth quarter, 2 percent below last year's fourth-quarter total of 2,639.

The $8,000 federal income tax credit for first-time buyers has been extended for contracts entered into before April 30, 2010. A tax credit of $6,500 for current homeoqners who want to sell and move up buy the same date. That's good news for buyers and sellers.

This information is made available to those of us by the research division of Prucential California Realty based on analysis of Multiple Listing Service (MLS) data.