Real estate trouble in the Golden State?

08/17/2010 - Today: Southern California home sales plunge in July. Zynga buys a Boston game developer. Hewlett-Packard buys San Mateo software maker Fortify.

Real estate trouble?

Last week, we had a report from the National Association of Realtors of a second-quarter upturn in the real estate market -- especially in California metro areas such as San Jose and San Francisco.

That report, though, came with a warning of a summer slowdown, in part because of the expiration of federal tax credits of as much as $8,000 for many homebuyers.

Today, we definitely have evidence of a housing market slowdown in the Golden State. According to MDA DataQuick, the number of home sales throughout Southern California in July had its biggest year-over-year drop in two years.

In Los Angeles, Orange, Riverside, San Bernardino, San Diego and Ventura counties, the number of sales was down 20.6 percent from the month before and 21.4 percent from July 2009.

"It appears some of the sales that normally would have occurred in July were instead tugged into June or even May as buyers tried to take advantage of the expiring tax credits," DataQuick President John Walsh noted today. 'Some of last month's underlying technical numbers were largely flat, indicating that the market is treading water."

Despite the drop in sales, the median home price in the region climbed 10.1 percent year over year to $295,000.

As for Silicon Valley and other counties in Northern California, we expect DataQuick to report data for July later this week.

Zynga buys Conduit Labs

Zynga, the San Francisco maker of Facebook games such as "FarmVille," has bought Conduit Labs, a social games upstart based in Boston.

Terms of the deal weren't disclosed, but Conduit Labs CEO Nabeel Hyatt will now be in charge of Zynga's Boston game studio. Conduit's titles include music games such as "Loudcloud."

"We have always had the desire at Conduit to build something ambitious, and we recognized that sometimes the best way to achieve these dreams is with a partner who can bring amazing resources to bear," Hyatt wrote today on his startup's official blog.

Conduit was founded in 2007; it has received funding from Charles River Ventures and Prism VentureWorks. According to TechCrunch, the two firms have poured $8.5 million into the startup in two funding rounds.

HP buys Fortify

Palo Alto tech giant Hewlett-Packard has acquired Fortify Software, a San Mateo software upstart founded in 2003 in the basement of Silicon Valley venture capital powerhouse Kleiner Perkins Caufield & Byers. Financial terms weren't disclosed.

Fortify makes software that helps businesses protect digital information, reduce risk and comply with financial regulations. The company initially operate as a stand-alone business, but will be integrated over time into HP's software and solutions unit.

"Fortify has always been committed to helping chief information security officers and application teams find, fix and prevent

security vulnerabilities before they can be exploited by attackers," Fortify CEO John Jack said in a news release. "Joining HP will allow us to further integrate our proven technology and security expertise with HP's solutions."

According to a recent Mercury News profile, Fortify has received more than $40 million in funding from Kleiner Perkins and other investors.

More tech headlines

Aruba Networks: The Sunnyvale maker of wireless equipment is expanding a partnership with Texas computer maker Dell. In a multiyear deal, Aruba's wireless networking technology will be sold under Dell's PowerConnect brand.

The deal with Aruba follows Dell's announcement yesterday that it intends to buy Fremont data storage provider 3Par for $1.15 billion.

Microsoft: The Redmond, Wash., software behemoth is linking its popular Xbox 360 video game console with its upcoming Windows 7 Phone software.

According to our friends at The Associated Press, Microsoft intends to deploy Xbox game developers to create titles for its smartphone platform. Microsoft also intends to make it more efficient for outside developers to make games for both the Xbox and Windows phones.

Silicon Valley tech stocks

Up: Apple, Google, Cisco Systems, Oracle, Intel, HP, VMware, eBay, Gilead Sciences, Yahoo and most Silicon Valley tech stocks were higher.

On Wall Street today, strong earnings from retail giants Walmart and Home Depot fueled investor enthusiasm.

The tech-heavy Nasdaq composite index: Up 27.57, or 1.3 percent, to 2,209.44.

The blue chip Dow Jones industrial average: Up 103.84, or 1 percent, to 10,405.85.

And the widely watched Standard & Poor's 500 index: Up 13.16, or 1.2 percent, to 1,092.54.
source: www.mercurynews.com