Here are the highlights of September transactions and market comments for Santa Clara County real estate and San Mateo County real estate. Your comments and questions are always welcome. If you see something in your neighborhood that you are curious about or have a question, please don't hesitate to share with us. You may leave comments here, or contact me through my
website.
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Market Overview -- The last four months has shown a general decline in the amount of sales. Closings of single family residences (SFR) in Santa Clara County decreased and are at levels just below those seen in either September of 2009 and September 2008 but above the level seen in September 2007. Same holds true for San Mateo County which saw a lower level for the past three months. My analysis of the transactional information reveals:
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The supply of homes available for sale (inventory) is trending upwards in both counties these past nine months which is usual for this time of the year. However, the rate of increase has slowed significantly in Santa Clara County and is well below record levels. San Mateo County inventory, while also trending higher for the past nine months, is close to record levels. The market overall remains more positive in Santa Clara County.
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More than 40% of sellers in Santa Clara County get at least list price for their homes! In San Mateo County, the corresponding percentage is a bit over 30%. This is another indicator that the overall market remains stronger in Santa Clara County. Also, these indicators have drifted lower and underscore a slowing market in both counties -- usual for this time of year.
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Days of Unsold Inventory (DUI) continues an upward trend translating into a slowing market. However, as we enter October, we've seen a reversal of direction so we'll have to see if it continues. As we have discussed, DUI is conceptually the inverse of inventory turns ratio and represents a calculation using both supply and demand. A higher figure for DUI, then, means the market is becoming weaker. For September, Santa Clara County had a DUI of 74 for SFR, 88 for condos/townhouses and 172 for multi-unit properties. San Mateo County had a DUI reading of 104 for SFR's and 140 for condos/townhouses. Notice that all readings were more positive for Santa Clara County.
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Seller Markets? -- For Santa Clara County the hottest (seller) market areas are South San Jose, East Valley (SJ), Milpitas, Evergreen Valley (SJ) and Cupertino. I very-recently listed a Cupertino home in the Monta Vista High School attendance area and had some 250 people through for the two open houses. It generated multiple offers with a sale price exceeding list price. A seller's market has shorter time on the market, fewer number of homes available for sale, higher demand by buyers with a tendency to have multiple offers and sale prices generally exceeding list prices with a potential of price appreciation.
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Buyer's Markets? -- For Santa Clara County, we see buyer's markets in Los Gatos, Almaden Valley (SJ), Saratoga, Campbell, and Willow Glen (SJ). Los Gatos is my current "Best Buy" area in the county. What makes a "buyers" market is the relationship of supply to demand -- simply put as higher supply and lower demand. The characteristics of a buyer's market is a longer time on the market, higher number of homes available for sale, lower demand by buyers which translates into a lower probability of multiple offers and a tendency for price stabilization or even price depreciation.
Where do I get "Seller's" and "Buyer's" market information? This is not an opinion or based on price levels but a calculation I make using the number of homes for sale (supply) and the number of sales (demand) in the prior month which results in days of unsold inventory (DUI).
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Median prices drop a bit -- Santa Clara County median price for SFR's decreased slightly after five months of increase this year. It stands at about $625,000. The median price for condos/townhouses dipped a bit more in percentage terms. San Mateo County's median price for SFR's has dropped to just above $700,000 from the $790,000 level. I continue to advise my clients NOT to use an entire county's median price level to decide whether to buy or sell or time the market but use the trend information in a general manner. To formulate an effective strategy, I use analysis of the supply-demand characteristics of the neighborhood under consideration.
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Boo! Buyers get ready -- Historically, a good time to buy is approximately at the time of Halloween or a bit after. I don't see it any different this year. As we enter the early holiday period just before Thanksgiving, those homes on the market, in all likelihood, have to be sold by their owners.
Need help with understanding the market in your area? Give me a call or email me for a no-obligation consultation and research to arm you with market intelligence to help you make a better, more-informed decision.
Thanks for reading my blog. I'm Tom McEvoy, Realtor with RE/MAX Santa Clara Valley -- Let me know your comments, questions, observations you may have or any future topics you'd like me to address.
