The San Francisco, CA market saw an increase in closings of new homes in June year-over-year, and the percentage surge, which was better than May 2012, suggested the market may be improving. New home closings increased by 17.3% in June 2012 from a year earlier, after closings saw a 13.5% jump in May from the year earlier.

A total of 2,860 new homes were sold during the 12 months that ended in June, up from 2,817 for the year that ended in May.

Out of all housing closings, new home closings represented 5.1%. A year ago, new home closings accounted for 4.1%. After rising year-over-year in May, closings of new and existing homes fell year-over-year in June.

Average price of newly sold homes had a 2.9% decline year-over-year to $566,888 per unit in June. This is a swing down from the 12.6% boost in May year-over-year.

The average mortgage size on newly sold homes increased year-over-year in contrast to the average price of new homes. It rose to $442,098 in June, a 4.6% rise. Average mortgage size increased 8.9% in May 2012 from a year earlier. Of the overall sale price, the percentage that was being financed rose 5.6 percentage points year-over-year to 78.0% in June 2012. This came after a 2.4 percentage point decline in May from a year earlier.

Closings of attached units, as a percentage of new home closings, have increased from last year while closings of single-family homes have declined. Attached unit closings increased from 46.8% of all closings in June 2011 to 54.0% of closings in June 2012. At the same time, the share belonging to single-family homes slipped to 46.0% of closings from 53.2% of closings.

For all new homes sold, the average unit size declined 16.2% year-over-year to 1,482 square feet in June 2012. A decline was also seen in May 2012 when the average size of new homes sold declined 7.0% to 1,472 square feet.

Foreclosures and real estate owned (REO) closings decreased in June from a year earlier, but remained a drag on the market. Out of all existing home closings, foreclosures combined with REO closings represented 31.8% of closings, below 45.2% a year earlier. The percentage of existing home closings involving foreclosures slid to 11.8% in June from 22.4% a year earlier while REO closings as a percentage of existing home closings fell to 20.0% from 22.9% a year earlier.

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