{"id":66287,"date":"2019-07-23T04:34:01","date_gmt":"2019-07-23T11:34:01","guid":{"rendered":"https:\/\/redfindevelop.wpengine.com\/blog\/?p=66287"},"modified":"2020-10-06T12:58:35","modified_gmt":"2020-10-06T19:58:35","slug":"affordable-home-price-drop-san-jose-orange-county","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/news\/affordable-home-price-drop-san-jose-orange-county\/","title":{"rendered":"Prices for the Most Affordable U.S. Homes Up 9% in June"},"content":{"rendered":"

Meanwhile, prices for the most expensive homes increased modestly, up 1 percent year over year.\u00a0<\/span><\/i><\/p>\n

California\u2019s San Jose and Orange County markets buck the national trend, with prices for the most affordable homes falling this year. <\/span><\/i><\/p>\n

Prices for the most affordable third of homes in <\/span>San Jose<\/span><\/a> dropped 3.8 percent year over year in June\u2014from an average of $760,309 to $731,688\u2014the fifth consecutive month of declining prices in the category after six straight years of growth. The story is similar in <\/span>Orange County<\/span><\/a>, where prices for the most affordable third of homes dropped 2.6 percent year over year in June, from an average of $461,158 to $449,390. Home prices in that category have dropped four of the last five months in Orange County (also referred to as Anaheim) after four straight years of increases.\u00a0<\/span><\/p>\n

In both San Jose and Orange County, among the most expensive areas in the country, supply of affordable homes has been rising since summer 2018 after nearly two straight years of year-over-year declines. Supply for the most affordable homes was up 94.1 percent annually in San Jose in June, and it was up 24.5 percent in Orange County during the same time period.\u00a0<\/span><\/p>\n

Dropping prices and rising inventory for the most affordable homes follow overall housing market trends in the two California metros, which have both been cooling slightly in recent months after years of rampant growth. San Jose saw its median home price fall 4.9 percent year over year in June, marking the fifth straight month of declines and the steepest decline posted by any metro area tracked by Redfin last month. Meanwhile, home prices in Orange County were up just 0.7 percent. <\/span><\/p>\n

\"San<\/p>\n

Prices for the most expensive third of homes dropped 1.6 percent in San Jose and rose just 0.5 percent in Orange County. It\u2019s the eighth consecutive month of declines in the category in San Jose after nearly two years straight of price growth. Supply for the most expensive tier of homes was up 50.5 percent year over year in San Jose in June, and up 11.2 percent in Orange County.\u00a0<\/span><\/p>\n

\u201cI\u2019ve been feeling a slowdown in the Bay Area the past few months. The beginning of summer feels like the end of summer usually does, with prices coming down and inventory up,\u201d said Redfin agent <\/span>Chad Eng<\/span><\/a>, who specializes in the San Jose area. \u201cThe cooldown is more pronounced in specific parts of the area, specifically greater San Jose.\u201d\u00a0<\/span><\/p>\n

But San Jose and Orange County are two of just three metro areas in the U.S. where home prices for the most affordable group of homes fell in June. The other is Memphis, where home prices for the most affordable tier fell 6.6 percent year over year to an average of $78,808 in June.\u00a0<\/span><\/p>\n

Elsewhere across the country, the price trend for the most affordable group of homes is the opposite: Prices for the most affordable third of homes nationwide were rising quickly in June while supply was shrinking. Contrast that with the most expensive third of homes, which are seeing prices rise slightly as supply grows by double digits.\u00a0<\/span><\/p>\n

Prices were up 8.7 percent year over year in June for the most affordable third of homes nationwide (those priced up to $232,000), the second-biggest increase in more than a year (the highest was last month, with an 8.9% growth rate). For homes in the most expensive third (more than $385,000), prices grew just 1.1 percent year over year. Even when the overall real estate market cooled in late 2018 and early 2019, it didn\u2019t cool much for the most affordable tier: Price growth for the most affordable group of homes hasn\u2019t dropped below 4.5 percent in at least the last seven years.\u00a0<\/span><\/p>\n

Here\u2019s a closer look at home-price growth in all three price tiers since the beginning of 2013:<\/span><\/p>\n