Today’s California Association of Realtors press release carries the bold headline: “Median price of a home in California at $538,770 in October, up 17.2 percent from year ago; sales decrease 2.8 percent”. And while prices are indeed up from a year ago, they are DOWN from the previous month (“The October 2005 median price decreased 1 percent compared with September’s $543,980 median price.”).
In addition, “C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in October 2005 was 4 months, compared with 3 months (revised) for the same period a year ago.” The press release also included the following:

“Note: Large changes in local median home prices typically indicate both local home price appreciation, and often, large shifts in the composition of housing market activity. Some of the variations in median home prices may be exaggerated due to compositional changes in housing demand.”

In other words, even if “median sales prices” are increasing, it could be due to a changing sales mix (i.e. wealthy owners/investors getting while the getting is good) rather than any real home value appreciation. Keep that in mind while we report that the median sales price in the San Francisco Bay Area ticked up 1.4% from September to October, while sales activity fell nearly 10% during the same period (and over 10% year-over-year).
California Association of Realtors Press Release (11/28/05) [CAR]
October 2005 Median Home Prices Chart [CAR]

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