Home prices in the Bay Area continued their upward surge in June, though buyers there are struggling with low inventory and still-tough lending requirements.
That's according to a new report Wednesday from DataQuick, which saw the median price in the nine-county region hit $618,000, its highest point in nearly seven years. In San Francisco, the median price reached $1 million.
Prices in the Bay Area grew 11.4% compared to last year. That's a slower pace than past months but considerably faster than the 7.8% clip recorded in Southern California in June. And the number of home sales grew for the first time since September, up two-tenths of 1% from last June.
The stronger economy in that part of the state is powering a stronger housing market, said DataQuick analyst John Karevoll.
"Trends in the Bay Area lead the rest of the state by at least half a year," he said. "The reason is straight out of Econ 101: Jobs."
Still, Karevoll said, the market is constrained by having relatively few homes for sale, and by lending requirements that are keeping many would-be buyers from being able to afford the homes that are on the market.
"There's a lot of opportunity out there for lending institutions that could expand their product lines," Karevoll said. "In today's Bay Area real estate market, for example, adjustable-rate mortgages should be much more widespread."
ARMs accounted for 26.6% of home purchase loans in the region in June, up from 16.9% from last year, but well below historic norms.