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Newest Figures Show New Home Sales and Prices Rise in San Jose

Posted on: May 06, 2013 07:33:06 AM

In the San Jose, CA market in February, new home closings increased year-over-year, and the percentage surge was sharper than January 2013, hinting that the market may be strengthening. New home closings saw a 52.9% jump from a year earlier to 107 after closings rose 50.0% in January from the year earlier.

A total of 1,539 new homes were sold during the 12 months that ended in February, up from 1,502 for the year that ended in January.

New home closings made up 8.8% of overall housing closings. This is a rise from 4.7% of closings a year earlier. Closings of new and existing homes declined year-over-year in February after also falling in January year-over-year.

Pricing and Mortgage Trends

Average price of newly sold homes saw a 21.2% gain year-over-year in February to $719,715 per unit. This hike is better than the 13.3% lift in January year-over-year.

The average mortgage size on new homes moved north year-over-year along with new home prices. It climbed to $556,959 in February, a 27.6% boost. Average mortgage size gained 15.3% in January 2013 from a year earlier. For new home closings, the percentage of the sale price that was being financed rose 3.9 percentage points year-over-year to 77.4% in February 2013. This was another rise after January 2013 when there was a 1.3 percentage point rise 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. The share of new home closings belonging to single-family homes increased from 41.4% in February 2012 to 54.2% of closings in February 2013. Conversely, the share of new home closings belonging to attached units slipped to 45.8% of closings from 58.6% of closings.

There was a 9.3% decline year-over-year in the average unit size of newly sold homes to 1,711 square feet in February 2013. For newly sold homes, an average size fall contrasting with an average price rise was also seen in January 2013 when the average size of newly sold homes dropped 20.9% to 1,541 square feet.

Foreclosures and real estate owned (REO) closings continued to fall from a year earlier in February, but did not appear to be dragging the market. Foreclosures and REO closings, taken together, represented 18.9% of existing closings, lower than 39.6% a year earlier. The percentage of existing home closings involving foreclosures slid to 6.2% in February from 19.6% a year earlier while REO closings as a percentage of existing home closings dipped to 12.7% from 20.0% a year earlier.

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