Local Market Update - Silicon Valley Real Estate

Market Watch

Low Inventory Still Impacting Northern California

September 11, 2017

Sparse housing inventory continues to affect the Northern California market. The California Association of Realtors’ latest report indicates that the San Francisco Bay Area endured a large drop in pending sales due to the lack of available housing. In fact, it dipped 11.5 percent since last July. The report also indicates that San Francisco and San Mateo counties were both down double-digits, 11.0 percent and 21.4 percent, respectively. For homeowners on the fence about selling, the lack of inventory makes it a great time to list because many patient home buyers are prepared to come in with solid offers. Read more about what’s happening, coming directly from our Northern California Coldwell Banker offices:

From the trenches...:

SF Peninsula – Half Moon Bay’s market remained competitive. The luxury market continued with strong demand. Average days on the market was just 17, with a median sales price of $2 million.
Menlo Park experienced a fast-paced market with no slowing. Sellers were encouraged to list their homes instead of trying to time the market or wait for a more optimal time.
Redwood City had a lack of inventory. Homes priced under $1 million brought in multiple offers. In the $1 million-plus market, homes sat on the market longer before closing.

Santa Cruz County- Offices in Santa Cruz saw a strong month. Average sales prices have been increasing steadily for the last five years by $30,000 to $90,000. This year is no different, with the average sales price of $950,000 and an average list price of $1,050,000. Buyers have been more aggressive in their offers. The luxury market in Santa Cruz peaked in comparison to the last few months with an average of just 50 days on the market (instead of 54 days), and experienced significantly more sales above the $1 million mark over past months.

Silicon Valley – Cupertino continues to experience a lack of inventory. However, the luxury market is still active up to $4 million. Low inventory was also a key factor in Los Gatos’ market, creating a similar dynamic as in Cupertino.
Gilroy and Morgan Hill also endured a lack of inventory causing multiple offers and high closing prices. Even in those markets favoring the supply-side, sellers should be prepared to choose quickly when presented with multiple offers. To submit a winning offer, buyers must put their highest offers first and make the transaction easier for the sellers.
San Jose remained active even with declining inventory. Because of the decreased supply, prices have slightly increased. Sellers can take advantage of the high demand. Buyers should think long term and be prepared to make a strong offer. Factors such as multiple offers or slightly higher asking prices should not deter them from putting in offers.
Saratoga’s market saw an increase of 21 percent in the average sales price year-over-year. The luxury market remained active with five listings and four sales.

My personal current market report allows you to check in for your own City, and area within your City.

Thank you for reading,
Francis

Your Home Value?

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

Home purchases by foreigners in the US

What is the profile of the international home purchase activity in the US?

About a year ago I mentioned some of the characteristics of the types of properties foreign buyers were buying, depending on where they are from.  This blog here is more general in nature and shows how much, globally, each country participated in the buying binge in the US.

An image is worth 1000 words...  the National Association of Realtors put out a study and infographic that says it all, entitled:  Where are most international buyers from?
Please check out the NAR's  2016 International Profile.

.. which translates in the following figures:

Thank you for reading,
Francis

Silicon Valley real estate specialist
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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.
Check your Home Value
A worthy local non-profit to remember: Community Services Agency in Mountain View

Perspective on the Real Estate Market - Silicon Valley - USA

A perspective on the real estate market in the US, and in the Silicon Valley - the Bay Area of San Francisco.

As I update this amazing graph every year around the month of April - May, I cannot stop being amazed at the evolution of prices in our corner of the world.
This graph makes me think somewhat about the technical progress of the past 3 decades  - also unique to our generation.  Although obviously it is not in direct correlation to scientific discoveries, since it is a reflection of other factors like supply and demand, economic upticks and downturns and geographic particularities, the graph is as extreme in its own way, and covers a time frame that is the same.

Click to see a larger graph.

What happens after the end of 2016?  For now the market is still a strong sellers' market in most of the US regions. 
Nationwide the median home value is now higher than right before the "Big Crisis", at $198,000, according to the April Zillow® Real Estate Market Reports (Svenja Gudell article).
However, let's not forget that this is not true of all of the US: in 17 of the 32 largest metropolitan housing markets prices are still below-peak (like in Las Vegas, Phoenix, Miami).

Here in the Silicon Valley the market remains very much a seller's market. At this point, I believe the annual appreciation will be easily around 6-8%.  The areas with the lowest average prices may even show a higher rate of appreciation.  Multiple offers are the norm, and cash is king...

Thank you for reading,
Francis

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

8 facts about Mountain View, Google's hometown

Mountain View is the hometown of Google.  Have you ever been curious about the town that hosts Google?

Here are 8 facts about Mountain View that you've always been curious about, but never asked - ok, may be you checked before... ;-)

 In 2016:

• 573 homes sold - houses, townhouses and condominiums,
• Mountain View’s average home sales price is:  $ 1.384 million, roughly 6% over the asking price, and 4.3% over the average sales price of 2015,
• The average time for properties to sell was: 19 days
• Out of those 573 homes, 42% were single family residences.  The others were condominiums or townhouses,
• Overwhelmingly, properties sold in Mountain View were 3 bedroom homes (41%).  Then in order came the 2 bedrooms (29%) and the 4 bedrooms (18%).
• Nearly half of the homes were between 40 and 70 years old (45%).   (13 were over 80 years old, 37 were new or 1 yr old),
• The average size of all these sold Mountain View homes is 1493 sq.ft.
• Half of all the households of Mountain View made over $103k/year and half made under that.

Curious about more info on Google's town?  Check out my full neighborhood report.

Curious about your town, in the Silicon Valley? curious about the value of your home?  Let me know, I'll do the study.

Thanks for reading!

Francis

Your Mountain View Home Value

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

Silicon Valley market update - California/US Update

Here are some news from the trenches...  concrete information about what is happening in our local area of the Silicon Valley - Plus, for some perspective, some information about the hottest markets in the US. (which include San Francisco and San Jose in the first two...).

Silicon Valley – More listings are emerging in the region, but Santa Clara County is still facing a shortage of available homes and strong buyer demand, which in some cases is leading to bidding wars. Open houses drew “hundreds of visitors” in the last two weeks, reports the Cupertino office manager. All offers ratified over the past two weeks have been multiple offers and all deals have contingencies in place, according to the San Jose Almaden office manager. Prices were up in several communities in January compared to the same month in 2016, he noted. Almaden’s average sales price was $1,329,000 in January, which was up 12 percent from January 2016 and down 3 percent from December.  Blossom Valley’s average sales price followed a similar trend. The average sales price in that community was $708,000 in January, which is up 10.5 percent from January 2016 and down 9 percent from the prior month.  In contrast, Cambrian’s average sales price declined 10.5 percent from a year ago to $916,000 and was down 6 percent from December.  Santa Teresa’s average sales price rose 11 percent year-over-year to $759,000 in January and was also 2 percent higher than the average sales price recorded in December. Most homes are going into contract after just one weekend on the market and in some areas homes are selling well over 10 percent of asking list price, says the San Jose Willow Glen office manager. Despite the strong demand and brisk activity, “Sellers still need to be careful not to overprice as we see homes that are priced above market sit idle as more competitively priced homes are seeing all the action,” explained the San Jose Main office manager.


For the hottest real estate markets in the US (many of them in California), please follow this Coldwell Banker article.

Thank you for reading!
Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates
A place worth noting: Our Brother's Home in MountainView

Where can you find that home style?

Where can you find that style?

Great article I found recently about the various building styles in the US, and in which area/state you are more likely to find them. 

The following map speaks quite well about the locations and the styles, but I find the article itself most interesting to read as it goes into the reasons why a style is more prevalent in a given state, and the usual value of the houses.

It comes to no surprise that the Mediterranean style is the most expensive, - it is often the case here too in the Silicon Valley, although I would add to this article that the “contemporary” home and the “modern” home are likely to be the most expensive where we are, as they are often associated with “new”, "recently build" and “high tech” or “smart home”.  This includes energy efficient.  Only the Eichlers might fit in that category of “contemporary” while not being necessarily new.

From an article in Realtor.com author by YuqingPan.

Thank you, as always, for reading, and let me know if you are thinking of buying or selling in 2017! ;-)

Francis

Buying or selling?

Silicon Valley real estate

Worthwhile non-profit Agency:  CSA in Mountain View

Santa Clara County: Price evolution.

'tis the time of year: how did sales prices fare in the County of Santa Clara (Silicon Valley) for the past 2 years?  This blog looks at the price of houses only: Single Family Residences.

Looking at the graph below, one can see the curves of median prices and average prices, month by month.  They are similar, but not equal though:
- over the period of the last two years, the median price went up 18%, from a median of $813k in Jan. 2015 to a median of $963k in Dec. of 2016.
- this is a much higher appreciation than the average price, which went up only 6% from $1.13 million in Jan. 2015 to $1.2 million the month of Dec. 2016.

As a reminder, this median price means that half of all buyers bought a house over $963k, and half bought a house under that price.

Something apparent in this kind of graph (which I publish regularly over the years) is the evolution over the course of the year: prices go up as a whole in general during the first 6 months of the year, and have a tendency to go down from there until the end of the year - with the exception of Sept. and October, when there is a regain in activity.

This is difficult to interpret completely: it does not mean necessarily that the value of a specific house will go down at that time, nor that it is not a good time to sell in November or December.  What it does mean instead is that statistically, more houses of a lower value sell during those periods, and this could be because of many reasons.
One of them, for instance, could be that people in a higher price range can wait for a "better" time to sell: the traditionally "active" real estate season of January to June.  It could be that more people "have" to sell at the end of the year;  more pressure means less room for negotiation.
What is also true though is that a beautiful remodeled home in a desirable neighborhood will probably not loose any value even at the end of the year, at least in our area of the US.

Finally, as a reminder that we always have to take graphs and statistics with a grain of salt, the same figures translate into the following:

Average prices for 2015:  $1.246 million
                         for 2016:  $1.292 million.  This is an increase of 3.7%

Median price for 2015:  $950k
                      for 2016: $1.02 million.  This is an increase of 7.4%

This is a better representation of the market as we follow the market over the years:  from year to year, instead of from a given month to another given month.

To make sense of the evolution of prices in your own local area, or to price your home, do contact me.
Thank you for reading,
Francis


PS: Detailed info per County always available on my web site at:  www.frolland.com under the tab: "Local Info and Stats".

Santa Clara County 2016 yearly report.
San Mateo County 2016 yearly report.