Real Estate Price Seasonality - Bay Area of San Francisco

Santa Clara County:  As I regularly do every year, I look at the evolution of real estate prices from month to month, and compare that with the year prior.

I just finished putting down 2017 and 2018 on graphs, and until the end of February 2019 - shown below:

Click to see larger.


Several remarks:

We had a feeling in 2017 that prices were not slowing down during the usual slow periods of the year: in summer, and in winter.  Well it shows clearly here that July and August did not go down in value (whether it is in average, or as a median price), and hardly came down in Nov. and Dec.

This is to be compared with last year in 2018 which everyone identified as a "slower market": indeed, after May 2018 prices started to go down a bit, with a verifiable dip in July and August (showing a month later when properties close), a typical regain in activity in September, and then a continued soft market after that.  The end of 2018 was definitely a good time to get in the market.

February is showing us that, with the help of low mortgage interest rates, the market is picking up.

Currently, these gentle interest rates along with a fairly low inventory of homes for sale contribute to a rise in prices - right on cue... statistically.

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Thank you for reading,
Francis

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Real Estate Silicon Valley - Price Seasonality

Here is an update on my regular graphs on the seasonality of prices in the Valley.  This graph shows the peaks in the County of Santa Clara (mostly = the Silicon Valley) which includes among other big city names: Santa Clara, San Jose, Sunnyvale, Cupertino, Palo Alto, - all big locations for the high tech industry.

As expected, the months of Feb to May show the highest average prices every year, followed by a (small) dip in summer, and a small bump in September-October, and again another slow-down in Nov.-Dec..   As in previous blogs, I'd like to point out that all of this is statistical, and does not necessarily mean that a given property will sell for more or less depending on the month.  It does mean that over large numbers of sales, the trend exists.
The sales prices for a given month show the following month, as transactions usually take about 3-4 weeks to close.


Click on the picture to see it full size.

Thank you for reading, and as always, if you like the post, do share it ;-)

Francis

Home Valuation tool
Detailed, local trends etc...
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Seasonality of real estate sales prices - Silicon Valley

To piggy-back on one of my earlier blogs on the evolution of prices in the Silicon Valley, here is an updated graph showing the median price of a residential piece of property in the County of Santa Clara, between a bit before Jan 1, 2015, and right now: July of 2017.





















Click on the graph to see it larger.

The green arrows point to a seasonal low in Aug./ September (corresponding to August sales) and a movement downwards in january, which corresponds to sales in November and December.
As mentioned in my previous blog, it does not mean necessarily that the same property will sell for less in December than in January, but it does mean that more properties of a lower value sold in November / December than in January.  One can see that in February the median price starts going higher (these are the January sales).

Will the same property sell for less during those times?  It is open to question, but my experience is that a prime piece of real estate, with good location, very good condition etc... will sell for about the same price.  By experience, if a property is not top notch, it may suffer somewhat from the timing.   Otherwise, these ups and downs relate to the fact that:
- many people are away during the months of July and August,
- many people wait for right after Labor Day to put a property on the market (feeling that fewer people will be in the market to buy a home, because away on vacation),
- fewer people are looking to buy in November and December because of the holidays and the weather.
- statistically, more homes go on the market during those slower times because they have to.  This can  also explain why the sales price is lower.

Thank you for reading!
Francis

Trends: Local prices and graphs.
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A worthy local non-profit to remember: Community Services Agency in Mountain View

Median Sales Price - Santa Clara County - Good time to buy now?

Median sales price in Santa Clara County: is it a good time to buy now?

The time is about right now for an update on this fairly important matter, especially for buyers who have been in the market to buy for a while, or are thinking of making a move in the near future.
My last post on the subject, "the ratio of sales price over list price", and last year's post in September "the evolution of average prices" provide some perspective on this (as well as an article last week end in the SF Chronicle, BTW).

Below is the graph showing the monthly change in median price for all homes (houses and condos) sold in the County of Santa Clara, since the beginning of last year (2014).  On this graph we see the median price, and not the average price.  "Median Price" means this: the same number of homes sold over that price, as the number that sold under that price. But one can see that either way, the trend is similar to the one that the average price followed last year.

All in all, it means that it is statistically a better time to buy during the last months of the year than during the first six months of the year, when prices go up - because more people are looking, and need to buy during those months, to be settled in for the next school year.  Probably it also means that fewer people are looking to buy as we get closer to the winter months, and the Holidays.  It can also mean that the homes that sell during that time are in general less expensive than during the first 6 months (smaller homes may be?).  It is not a definitive call that a house will be bought for less money all things considered, but it certainly is worth keeping in mind the seasonal trend.

One last remark on the subject: the trends in years past are a lot more pronounced.  In the past 2 years, or so, the market is such a sellers' market that the slowdown in the market is just mild towards the end of the year.  One should remember that it is still very much a sellers' market, and that there continues to be a strong competition among buyers for the nicest homes.  But my experience has been that buyers are less stressed when buying a house closer to the end of the year.

Thank you for reading!
Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

A worthy local non-profit to remember: Community Services Agency in Mountain View

Silicon Valley real estate: ratio sales price/list price - end of the year inventory.

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,

Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates