The number of properties available for sale is always smaller around the first of the year, and the market less active as the Holidays take people to other places, both in their minds and physically.
This year for the area covering the five cities of Los Altos, Los Altos Hills, Mountain View, Palo Alto and Menlo Park, we start the year with a total inventory of homes for sale of 37 (24 of those are over $2 million). This total includes houses, and condominiums/townhouses.
As a comparison, last year we started with a total of 51 properties. This, coupled with the huge activity I see at open houses, indicates that for a foreseeable future there is a large imbalance between the number of buyers and the number of sellers.
For the area covering the whole County of Santa Clara, we start the year with a total number of properties for sale at: 606… Last year, we had 751 homes for sale at the beginning of the year. Even though many areas are not as extreme as around Los Altos and Palo Alto, we still see a strong sellers’ market out here, especially in the entry-level / lower price range.
My monthly market update, accessible in a detailed form on my local newsletter, shows that the average ratio of sales price over list price is lower towards the end of the year (this graph is for the County of Santa Clara):
These are two facets of the local market around the New Year: statistically, properties sell for less of a premium, but the fact is that it is still a very strong sellers’ market. Many clients ask me why and the answer is not straightforward. I think that it reflects on the fact that over large numbers, statistically, there may be more properties on the market that must sell, as compared with the rest of the year. It may also reflect on the fact that the quality of the real estate offerings is lower, and/or there are fewer buyers looking. Remember, these are statistics. However what it does not mean is that a desirable property, in a desirable area (schools, prime location etc…) will sell for less, if there is not a “time pressure” factor involved.
Any input on this? Do let me know,
Thank you for reading,
Silicon Valley real estate specialist
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