Closings of new homes declined year-over-year in June in the San Jose, CA market, but the percentage decline was not as steep as May 2016, giving suggestion that the market may be stabilizing. New home closings saw a 29.6% decline from a year earlier to 159. This followed a 30.2% drop year-over-year in May.
A total of 2,006 new homes were sold during the 12 months that ended in June, down from 2,073 for the year that ended in May.
Out of all housing closings, new home closings represented 8.3%. This is down from the a year earlier when new home closings accounted for 10.8% of total closings. Following a year-over-year decline in May, closings of new and existing homes also sank year-over-year in June.
Pricing and Mortgage Trends
In June, the average value of new homes saw a 2.5% gain year-over-year as it grew to $882,442 per unit. This lift follows a move from $883,067 per unit in May 2015 to $887,375 in May 2016.
Along with new home prices, there was an increase year-over-year in the average mortgage size on newly sold homes. Average mortgage size gained 2.0% to $627,823 in June from a year earlier. In May 2016, average mortgage size on newly sold homes saw a 7.1% rise year-over-year from a year earlier.
Other Market Trends
As a share of new home closings, single-family home closings have climbed from last year while the share belonging to attached units has fallen. Single-family home closings increased from 34.1% of new closings in June 2015 to 46.5% of closings in June 2016. At the same time, the share of new home closings belonging to attached units slid to 53.5% of closings from 65.9% of closings.
For all new homes sold, the average unit size climbed 14.4% year-over-year to 2,281 square feet in June 2016. The average size of newly sold homes moved from 2,226 square feet in May 2015 to 1,969 square feet in May 2016.
Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in June, but did not appear to be dragging the market. Together, foreclosures plus REO closings made up 3.7% of existing home closings, down from 4.8% a year earlier. The percentage of existing home closings involving foreclosures went from 2.1% in June 2015 to 2.0% in June 2016 and REO closings moved from 2.6% of existing home closings in June 2015 to 1.7% in June 2016.