More Bay Area homes sold last month than in July, but the number was still way below the August 2005 level, continuing a slowdown that began more than a year ago, a real estate information firm said Wednesday.

A total of 9,128 new and resale houses and condos changed hands in the nine-county region last month, 14.9 percent more than in July.

Still, it was the slowest August since 1997, when 9,080 homes sold, according to DataQuick Information Systems.

DataQuick analyst John Karevoll said some buyers are holding out for lower prices and some sellers are testing the market to see if they can still get peak prices.

"It's very likely we're going to see pretty much the same trends for the next few months,'' he said, in terms of slower sales and flatter prices. "The question is how long is it going to take the market to burn off that noise . . . of all those unrealistically priced properties out there.''

The median price of existing single-family houses sold in the nine-county region in August was $664,000, according to DataQuick, which gathered the data from public records. That figure is 2 percent higher than a year earlier, but down 1.5 percent from July 2006.

In Santa Clara County, the median price of houses sold last month was $725,000. That's down from $750,000 in July, but 1.6 percent higher than the August 2005 median price of $713,500.

Twenty-seven percent fewer houses changed hands in the county last month than during August last year. The trend was the same in condominiums, with sales down 31.7 percent compared with a year earlier. The median price of a condo sold in the county last month was a record $511,000, up 4.3 percent from a year earlier. The previous record was $500,000, reached in February, May and July this year.

Townhouse owners Jeremy and Tracey Kemp are planning to put their two-bedroom West San Jose unit on the market soon and buy a larger home to accommodate their growing family. About a month ago they toured more than a dozen homes for sale in San Jose and Santa Clara, Jeremy Kemp said. Afterward their real estate agent heard from two of the agents listing homes they'd visited, asking about the Kemps' interest level and letting them know the list price was negotiable.

"We're seeing more strength in our role as a buyer,'' he said. "They were aggressively courting people who had just been walking through.''

Kemp, who moved to the valley from Oregon a few years ago and is used to slower-paced real estate sales, isn't too worried about how long it may take to sell the townhouse.

"It feels like what you would see in a normal market,'' he said.

It's a buyer's market in terms of supply, said Richard Calhoun, owner of Creekside Realty, who compiles data from the local multiple listing service database daily.

This week there are about 3,450 houses and 1,280 condos for sale in Santa Clara County. And given the pace of sales during the previous few weeks, it would take just over 100 days to sell all the houses, and about 90 days to sell all the condos, he said. In contrast, last year in early September there was a 43-day supply of houses and a 30-day supply of condos on the market, according to his data.

In recent years, the only times the supply of homes has been higher relative to sales pace were a six-month period in 2001, following the meltdown of the dot-com bubble, and from August 2002 to January 2003, Calhoun said.

"More negotiations are coming back'' to the market, he said, in the form of counter-offers that may go back and forth between homeowner and buyer before a deal is struck. For the past few years, sellers have held the reins in most transactions, allowing buyers little opportunity to ask for concessions. "It's refreshing to see some balance. It would be nice to keep some balance there even when the market improves down the road,'' Calhoun said.

Allen Cymrot, author, real estate investor and co-founder of the realty investment blog NetGainRealEstate.com, said homes staying on the market longer and buyers negotiating price with sellers are normal characteristics of a changing real estate cycle.

"Certainly things are slowing down,'' he said, adding that he expects Santa Clara home values to go "sideways and slightly down'' in months to come.

"I would tell a homeowner today, "If you want to buy a home, do so with one proviso -- that you plan on living in it for at least five years", Cymrot said, to help ensure the homeowner can ride through a possible lull in the real estate cycle. A precipitous drop in prices is unlikely, he said, because the valley has not seen excessive real estate investment by speculators, nor does it have excessive supply of new homes under construction.

Sherry Chris, chief operating officer of Prudential California Realty, agreed that the boom part of the real estate cycle has ended. Among her advice to sellers, she said, was to look seriously at the first offer they receive "and try and work with it. . . . The buyers can usually walk away, and there are other properties that may be of interest to them.''

She also recommends ensuring the home is included on all the major online home-search sites, with plenty of pictures, since those help buyers decide which homes to visit. Don't offer gimmicks like a free car or flat-screen television -- as some sellers have begun doing: "It looks like you're having difficulty selling your home,'' she said. "If your home is priced properly in this market, it will sell,'' albeit more slowly than it might have last year.