The Bay Area is known for its microclimates. That's as true for the real estate market as for weather patterns.
While home values have tumbled across the country, the San Francisco region has pockets of strength where prices continue to rise, albeit modestly compared with the double-digit appreciation of recent years. Not surprisingly, those strongholds are uniformly in affluent areas.
An analysis of home-price changes in Bay Area ZIP codes to be released Tuesday by www.zillow.com shows a map of the region as a virtual checkerboard of good news and bad news.
Homes in many parts of Silicon Valley, San Francisco and Marin County appreciated in value as of the fourth quarter, compared with a year ago, Zillow said. But foreclosure-heavy, low-income areas such as east Contra Costa and southern Alameda counties had more dismal changes - many ZIPs there show home values down 5 to 10 percent, even more than 20 percent, in the space of a year.
The price volatility "is a sobering reminder of what's going on," said Stan Humphries, vice president of data and analytics for Seattle's Zillow. "It's pretty dramatic."
However, he said, the Bay Area map actually is a pretty picture compared with many other places.
"There are a lot of colors (indicating price fluctuations both up and down) in the San Francisco Bay Area, which means there is a lot of regional variation," he said. "The Detroit area, for example, is more monochromatic, but it's all bad. The San Francisco Bay Area at least has some bright spots."
Overall, though, values in the Bay Area are definitely down for the year, according to Zillow. Home values fell 6.7 percent in the metropolitan area that includes Alameda, Contra Costa, Marin, San Francisco and San Mateo counties. That's a steeper drop than throughout the nation, where all homes are down 3 percent year-over-year, Zillow said.
Of the core Bay Area counties, only San Francisco shows appreciation for the year by Zillow's reckoning. Median home values were up 3.7 percent, to $857,274. And that still falls short of inflation, which was just over 4 percent.
Alameda County was down 7.2 percent, to $573,458, and Contra Costa fell an alarming 15.3 percent, to $482,70. The story was not much better in San Mateo County, which had values down 3.2 percent, to $779,702, or Santa Clara County, down 2.1 percent, to $724,354.
For many people, knowing their home is worth less on paper is just an academic exercise. But for anyone considering selling or withdrawing equity, a lower value translates into immediate, real-world effects. Sue McCullough, a computer programmer with Wells Fargo, "Zillowed" her home in Oakland's Laurel District on Tuesday and was dismayed to see it valued at $417,000 - about a 16 percent drop from a couple of years ago.
"It makes me very much more definite: I'm going to have our open, available line of home-equity (credit) shut down so we can't get into trouble," she said.
McCullough and her husband, Donald Barks, had planned to tap home equity to convert their tumble-down garage into a home recording studio. They got as far as tearing down the garage and then realized that building a new structure would max out their home equity.
"The last few years we used that home-equity line of credit for fun things, like vacations," she said. "That's not going to happen anymore. We have not exceeded the value of our home, but I don't want to go there. That scares me."
Zillow takes masses of real estate data - such as county records, MLS listings, its users' own information - and crunches them with proprietary algorithms to arrive at price estimates, or "Zestimates," for about 67 million homes nationwide.
The voyeuristic ability to check out not just your own house but your neighbor's, your boss', your friends' and the one you grew up in has made Zillow an instant water-cooler hit since its release two years ago. The site had about 4.6 million unique visitors in January.
Zillowing has entered the lexicon, a la Googling. Many people rely on the Web site to get a gut feeling about their home's worth.
"I check it quite insanely," Marcy Orosco, a social worker at the North Bay Veterans Resource Centers, wrote in an e-mail. "Our home is all we have, and we are desperately trying to hang on to it at this time. I wish I could shrug it off. Our home is right on the Russian River, therefore it has held value very well. If you are across the street from me, on the other hand, your home has really gone down in value."
But Zillow has taken a lot of fire for valuations that can seem too far off base.
"As a real estate attorney who obtains appraisals regularly, I have found that Zillow's results are always significantly off of appraised value, occasionally far off," said William Warhurst, a partner at Redwood City's Hannig Law Firm. He thinks the site's Zestimates are off by 10 to 15 percent.
Zillow said that its price estimates are just that - estimates, not appraisals. Any real estate transaction involving a mortgage, such as selling or refinancing, almost always requires a professional appraisal.
The company said it continually works to improve its accuracy, most recently adding new data, such as local market conditions, and new algorithms. In the Bay Area, 35 percent of home sales come within 5 percent of the Zestimate, while 61 percent of sales come within 10 percent, it said.
What is Zillow? A 2-year-old Web site that provides an automated home-valuation service offering "Zestimates" - estimated market values - for 67 million homes nationwide. Zillow has data on 80 million homes in 48 states, or 88 percent of all homes in the country.
How does it work? Zillow collects data from a wide variety of sources, such as county recorder and assessor offices and real estate listings, then uses proprietary algorithms to arrive at automated models for estimating home values. Users can tweak property information to fine-tune the valuations.
How does it differ from other pricing reports? Most real estate reports provide data on homes that recently changed hands, which means median price can be skewed depending on whether the mix of homes tilted toward more-expensive or less-expensive homes. Zillow gives information on all homes, not just those recently sold.