Silicon Valley Real Estate Trends

With continued low inventory levels and higher demand from buyers, the April median price in the Silicon Valley real estate market jumped to their highest level since 2007 to $800,000 for a single family residence -- up 24% from the same month a year ago.

Similarly, the median price in April for condos and townhouses in Santa Clara County was $510,000, compared to $349,000 the same month a year ago which was a phenomenal 46% change.

For San Mateo County, the San Mateo real estate trends showed the April median price at $956,000, compared to $760,000, last year or a 25.8% increase.

As you know, a median price figure is the middle transaction so this statistical calculation won't necessarily translate into an across the board increase for each and every home.  What it does indicate is a strong market pressure and an upward trend for the Silicon Valley real estate market.

The frequency of the sale prices exceeding list prices is 73% in Santa Clara County and 68% in San Mateo County.  An indicator of the magnitude shows that the sale price to list price ratio averages 106.1% and 105.8% in Santa Clara County and San Mateo County, respectively.

An indicator I track closely in addition to the above ones, is the median days on market.  This represents how long it takes for one-half of the listings to sell.  In Santa Clara County, it is 10 days but just 9 in the Cupertino and Sunnyvale market area (hottest area in the county with a median sale price of $1,223,000) to 17 in the South County area which comprises Morgan Hill to Gilroy with a median sale price of $629,000.  For the current San Mateo real estate trends, it is but 11 days.

If a listing lingers on the market significantly longer than the median, well then it is a candidate for an analysis to determine the possible cause(s) including price, condition, marketing, etc.

As the old Meat Loaf song went, "two out of three ain't bad".  The last three buyers I helped recently, two strategies out of the three were successful.  In the first one, with multiple offers, my advice to my buyers was to offer in a range above list price and doing so beat out the second-place offer by just $1,000 with eight offers and a sale price over $800,000.  In the second transaction, the strategy devised by and used by my buyers failed.  They calculated a dollars per square foot against comparable homes.  For residential, this approach only works when you get lucky as in winning the lotto but I use this in addition to other aspects in my commercial transactions.  Their offer came in tenth out of ten and they missed purchasing a beautiful home by over $100,000.  For the third one, my buyer listened and followed my advice to offer in a range above list price and even though he didn't have the highest priced offer, the seller did accept his offer and closed recently.  For this one, there was more to my strategy than just price so on that basis, he won.  In the two successes, I not only gave advice on the minimum but on the maximum to pay for the home.  By the way, my long-term average performance is a success rate of 60% so these last three upped my average slightly!

In the last few weeks, I've noticed a change in the market in the favor of the buyers!  Many homes have generated multiple offers but not to the extent that we saw in the early part of the year.  This is in keeping with the historical tendency as we near Memorial Day weekend that buyers decide they have other things to do -- e.g., graduations, weddings, anniversaries, planning for vacation when school gets out, etc.  Also noted is that the inventory levels or those homes available to purchase have risen lately, affording more choices for buyers.  For single family residences, the highest inventory in seven months and for condos and townhouses, the highest level in eleven months!

Notwithstanding my prior comments about the market conditions during April, buyers that have pulled back from actively looking for a home for whatever reason, now stand a much better chance of being able to buy with less competition than in the recent past.  Mortgage rates still remain favorable but have nudged up a bit but still in artificially low levels as the Feds continue to purchase a mixture of U.S. Treasury and mortgage-backed securities to the tune of about $85 billion per month!  Their most recent comments contain a lot of double-speak thus raising the risk of a change in their programs -- e.g., less buying and the risk of higher mortgage rates.  In following the money, a lot of the funds created in the banking system have gone into asset categories like stocks and real estate (Google recently hit $900 and LinkedIn $200).  This is the "new" way the government prints money.

Please leave a comment or question if there is something you'd like to hear more about or would like information about the market in your neighborhood or contact me through my website or send me an email.  Thank you for reading!

November Silicon Valley Real Estate Market Comments

Here are my observations of the most recent October transactions 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. If you have questions or a comment, please leave them here, or feel free to contact me through my website.

> General Market Observations and Comments -- Closings as well as the number of homes available for sale have decreased these past few months in both counties. Inventory, or the number of single family homes available for sale (supply) has stood at 2,200 in Santa Clara and 1,203 in San Mateo County. These figures are substantially less than those in the year prior. 73% of the inventory in Santa Clara County are traditional and the balance are lender-controlled (short sales 19%; bank-owned/REO's 8%); San Mateo County saw these figures at 77% for traditional, 16% for short sales and 7% for bank-owned/REO's.

Much different with condos/townhouses where 55% in Santa Clara County and 48% in San Mateo County are lender-controlled. Demand continues to point to single family residences (SFR) and away from condos/townhouses so my advice for buyers: if you prefer the life-style of a condo or townhouse, there are better buys possible. Yes, they have homeowner association dues but those often cover additional ownership features and benefits (e.g., some utilities, pool/spa, exercise rooms, and the like). One thing about it is that the owner doesn't have to worry about these items.

As for the available homes for sale -- we're seeing a bifurcated market. How I can tell is that homes available for sale have a median days on market of 69 whereas those homes that closed escrow have a median days on market of just 31. Homes priced well and in good condition, sell quickly and get the most activity (i.e., higher prices, quicker sale). Overpriced homes or those in poor locations or in poor condition (bank-owned or short sale homes are mainly in this category) stay on the market far longer.

Days of unsold inventory (DUI) for Santa Clara County stands at 57 for SFR's, 48 for condos/townhouses. San Mateo County stands at 83 for SFR's and 72 for condos/townhouses.

Days of Unsold Inventory is a calculation I use to gauge whether the market is a Buyer's market, Seller's market or what we call a Balanced market and is the intersection of supply and demand. In Santa Clara County, the Buyer's market exists for those areas above 90 DUI, a Seller's market would have a DUI reading under 45 and a Balanced market exists in between those numbers.

Mortgage rates remain very favorable in the range in the low 4% area. Since most buyers need a loan to purchase a home, mortgage rates are a major consideration in the decision and ability of the buyers to purchase. Even with lowered sales figures, escrow companies seem to be busy with loan refinance or refi activity.

For October, SFR median prices, half above and half below, stood at $550,000 and $675,000 for Santa Clara and San Mateo counties, respectively. Condos/townhouses stood at $316,500 and $355,000, respectively.

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.

Tastefully Updated Birdland Sunnyvale Home with Cupertino Schools

Open House available this Saturday and Sunday, November 14 & 15
from 1:30pm to 4:30pm, sharp.

~ Established Birdland, Sunnyvale Neighborhood Home with Cupertino Schools ~

Beautiful hardwood floors highlight this tastefully-updated Lindsey home with expanded master suite, kitchen and bathrooms. Kitchen was extensively remodeled and offers expansive, Corian counter tops, upgraded cabinetry and top built-in appliances. Living room can be used as dining room. Step-down family room with gas fireplace and wet bar opens to patio with wood deck and spa — great for family gatherings. Recent upgrades include 40-year roof, gutters/downspouts, and fresh exterior paint. Stocklmeir Elementary, Cupertino Middle, Fremont High School.

Take a Virtual Tour and see more Slides

If you have any questions or comments, please contact me, Tom McEvoy, Realtor at 408-830-0092 or by leaving your comment here.

Robbing the Bank to Pay Back the Bank!

Wow, a 69-yr old robs San Diego bank to pay for his 17% mortgage! The authorities should round up the loan officer, strip him of his license, place him in the clink and throw away the key! Seniors beware -- a lot of crooks are after you (us!). Work with someone you know AND trust.

Click on the link to view the source newscast but we here in Silicon Valley were not insulated from some of these crooks in the real estate and lending business who looked out for themselves and didn't place their client's best interest first and foremost. Some loan officers, many working for unscrupulous mortgage brokers, placed unsophisticated and unsuspecting borrowers into weird loans with prepayment penalties and the like to earn huge fees at the expense of the borrowers.

Probably most of the borrowers that were trapped by these crooks were not seniors but I think it is even more egregious when a senior is the victim.

Large, Move-in Condition, Feature-Rich Victorian Home -- San Jose, CA

World class chocolates in the valley of hearts delights

You've made dinner reservations at a romantic restaurant (I did!) and you might have picked up a little something for her at her favorite store (I'm looking!) but the there's always sweets for your sweets for Valentine's Day.


Here are some world class chocolatiers from Silicon Valley to Santa Cruz:




Chocoate Dream Box

• 710 Blossom Hill Road, Los Gatos. 408-356-2626 http://www.chocolatedreambox.com/

Pictured are hand-crafted chocolates in beautiful boxes by Chocolate Dream Box

Fleur e Cocoa Patisserie Chocolaterie

39 N. Santa Cruz Avenue, Los Gatos. 408-354-3574 http://www.fleurdecocoa.com/

Pictured are selected handmade chocolates from Fleur de Cocoa

Richard Donnelly Chocolates

• 1509 Mission Street, Santa Cruz. 888-685-1871 http://www.donnellychocolates.com/

Saratoga Chocolates

• 14572-B Big Basin Way, Saratoga. 408-872-1431 http://www.saratogachocolates.com/

Schurra's Fine Confections

• 840 The Alameda, San Jose. 408-289-1562 http://www.schurrafineconfections.com/

Shokolaat

• 516 University Avenue, Palo Alto. 650-289-0719 http://www.shokolaat.com/

Sugar Butter Flour

• 669 S. Bernardo Avenue, Sunnyvale. 408-732-8597 http://www.sugarbutterflour.com/

Pictured is Dark Chocolate Ganache Truffle from Sugar Butter Flour






Happy Valentine's Day!

Thanks for reading!

Lunar New Year Events

Happy New Year! OK, Happy Lunar New Year! In the Chinese calendar, the longest chronological record in history dating back to 2600 B.C., this year marks the lunar year 4,706 -- Year of the Rat. The first day of the new lunar year is February 7, 2008.

Here are some local events celebrating the Lunar New Year in San Mateo, Santa Clara and San Francisco counties.

Silicon Valley/Santa Clara County:

• Lunar New Year Blessing and Dedication Ceremony. Zen ceremony in Chinese and English followed by a vegetarian lunch. 9:30am - 12:30pm, February 3rd. Chung Tai Zen Center of Sunnyvale, 750 E. Arques Avenue, Sunnyvale. Free. 408-733-0750. www.ctzen.org/sunnyvale

• Vietnamese Spring Festival and Parade. Festival will include Vietnamese arts and crafts, live performances, martial arts demonstrations, children's games and rides, talent show and food booths. 11:00am - 6:00pm, February 10th. 180 Park Avenue. San Jose parade: Market Street between St. John and San Carlos Streets. Free. 408-202-2672. http://www.vsfsanjose.com/

• Lunar New Year Celebration. Traditional crafts, displays, martial arts demonstrations, music and dance performances and food tasting. 10:00am - 5:00pm, February 16th and Noon to 5:00pm, February 17th. Children's Discovery Museum, Woz Way and Auzerais Street, San Jose. Free. 408-298-5437, extension 204. www.cdm.org/p/viewPage.asp?mlid=4 .

San Mateo/San Mateo County:

• Challenge School Chinese New Year Performance. 6:30 to 8:00pm, February 7th, Bayside Performing Arts Center, 2025 Kehoe Avenue, San Mateo. $10 per adult. 650-574-6878. http://www.masterworks.org/ .

San Francisco:

San Francisco's Chinese New Year Parade began in 1860 and was named by the IFEA to be one of the top ten parades in the world! It is also one of the remaining night illuminated parades left in the country.

• 2008 Chinese New Year Parade. Saturday, February 23rd. 5:30 pm.

The Chinese Calendar names each year after an animal and legend has it that a person born under a certain animal will display traits of that animal. I was born in the year of the Tiger. What sign are you in the Chinese 12-year calendar cycle?

Rat: 1924 1936 1948 1960 1972 1984 1996 2008

Ox: 1925 1937 1949 1961 1973 1985 1997 2009

Tiger: 1926 1938 1950 1962 1974 1986 1998 2010

Rabbit: 1927 1939 1951 1963 1975 1987 1999 2011

Dragon: 1928 1940 1964 1976 1988 2000 2012

Snake: 1929 1941 1953 1965 1977 1989 2001 2013

Horse: 1930 1942 1954 1966 1978 1990 2002 2014

Ram: 1931 1943 1955 1967 1979 1991 2003 2015

Monkey: 1932 1944 1956 1968 1980 1992 2004 2016

Rooster: 1933 1945 1957 1969 1981 1993 2005 2017

Dog: 1934 1946 1958 1970 1982 1994 2006 2018

Boar: 1935 1947 1959 1971 1983 1995 2007 2019

Gung Hey Fat Choy! Chúc Mừng Năm Mới!

Thanks for reading!

Real Eats -- il Postale Italian-American Bistro, Sunnyvale, CA

When in or near downtown Sunnyvale, heart of Silicon Valley, stop in to savor the flavors of award-winning il Postale Italian-American Bistro. They're located on Washington Avenue just east of Mathilda Avenue in what once housed Sunnyvale's original post office.

My wife and I frequent the establishment which has been open for about 10 or so years. Joe Antuzzi, proprietor, keeps a daily "postcard" of specials for soups, entrees, desserts, wine and drinks. Along with the specials, Joe keeps his standby menu with a wide variety of Italian and American fare to indulge your taste buds and with choices to please just about every palate.

While there last night, my wife chose their special -- a cioppino (mixture of different kinds of fish and shellfish in a slightly-spicy tomato sauce) served around a mound of risotto. My wife commented that serving it in this manner allowed her the best of both worlds -- cioppino and risotto!

Off the regular menu, I had a generously-sized salmon filet topped with a few scallops and a dill sauce. It was served with risotto and mixed vegetables. Both were excellently prepared and presented.

So when in Sunnyvale, stop in and check it out for lunch or dinner. Definitely one of our favorites!

il Postale Italian-American Bistro

127 Washington Avenue

Sunnyvale, CA 94086

408-733-9600

www.ilpostale.com

Thanks for reading!

January Silicon Valley Real Estate Market Update

This information summary and analysis uses MLS Listings Inc. (MLS) transactional data for December 2007.



For single family homes in Santa Clara County, December saw the fewest closings (closed escrow) of not only any December but any month going back to 1984, when the MLS first started publishing data! There were 488 closings in the month with 450 initiated sales (accepted offers) that indicates that closings in January will be lower still.


This lower closings record occurred in each of the counties I track closely: Santa Clara, San Mateo, Santa Cruz and Monterey.


Inventory of available homes was 4,031 in December compared to a high of 4,925 in late October. Since then, we've seen a higher than normal level of listings expire at the end of October and again at or near year-end. Normally, inventory of available homes decreases during the late fall months due to seasonal factors. I suspect that we'll see a jump in inventory either in January or February as at least some of those homes come back on the market for another try.


Days of Unsold Inventory (DUI) or the intersection of the inventory (supply) with the recent sales level (demand), shows Santa Clara County at 303, San Mateo County at 190, Santa Cruz County at 351 and Monterey County at 579. Clearly, these are all indicating a buyer's market condition as a reading of DUI above 90 depicts. For comparison, a seller's market will have a DUI of less than 45 and a balanced market will have a DUI between the two. However, real estate is local (down to the neighborhood level) and market conditions can vary within each county and even within cities by a large amount.



For instance, within Santa Clara County, the Mountain View, Los Altos and Palo Alto area has the best market climate in the county with a DUI reading of 83 while South County (Morgan Hill, San Martin and Gilroy) has the worst reading of 698 followed closely by a 662 reading for East Valley part of San Jose. In San Mateo County, the best market climate is in Foster City with a DUI reading of 70 contrasting with a 210 reading on its coast that includes Half Moon Bay and Pacifica. The following is a ranking of selected Santa Clara County cities or areas with their current DUI readings:

• Los Altos, Mountain View, Palo Alto - 83
• Cupertino - 94
• Almaden Valley - 120
• Los Gatos, Saratoga - 126
• Campbell - 128
• Cambrian - 148
• Sunnyvale - 152
• Willow Glen - 163
• Milpitas - 210
• North Valley - 263
• Downtown SJ - 275
• Evergreen - 303
• South San Jose - 446
• East Valley - 662
• Morgan Hill, Gilroy, San Martin - 698

The median price for single family homes in Santa Clara County was $799,000 in December and compares to the record high reached in April 2007 of $868,400. This is a decrease of $69,000 or about 8.0%. Much of the increase to the record price was the result of a mix shift from lower priced homes to higher priced homes. In other words, less transactions out of the total occurred in lower priced homes and a higher percentage occurred in higher priced homes, resulting in an increase in the median. This mix shift was predominately caused by the mortgage problem that started in February when lenders started to increase their scrutiny of and place a higher standard on underwriting loans for borrowers hitting entry-level homes the hardest.

Median prices for single family homes by county in December 2007 were:

• Santa Clara County - $799,000
• San Mateo County - $875,000
• Santa Cruz County - $546,000
• Monterey County - $520,000

Has this drop in median prices been felt evenly throughout the county? Absolutely not. With seller's markets in the northwest portion of Santa Clara County (Palo Alto, Los Altos, Mountain View), their characteristics are price appreciation along with good demand whereas those affordable priced home communities have characteristics like a buyer's market with price depreciation and very poor demand.



We call the "sweet-spot" of the market that price range which has the lowest DUI. For December the $1,000,000 to $2,500,000 range is the most brisk. Next comes the $750,000 to $1,000,000 range and then the $2,500,000 to $5,000,000 range. This is unusual because a normal market has the more affordable priced homes with the lowest DUI.



For condo/townhouses the picture is similar but slightly better with a DUI reading of 264. Real estate investors take heart as the DUI picture has degraded substantially to a reading of 529. This means under the current rate of sales of multi-unit properties, there are about 1.5 years of supply! Even though rents have increased about 10% during both 2006 and 2007, the demand is just not there making this the best time for an investment purchase since 1994. Lenders have substantially increased the borrower's requirements to obtain a loan for investor property purchases. Does this foretell a price drop? We'll have to wait and find out.



Why follow all this, spending time dissecting statistics, reviewing trends and investing time doing old-fashioned real estate analysis? Simply, with this information I am armed with the latest information to provide my clients an advantage when it comes time to make a change in the market. Newspapers and other sources tend to generalize too much (i.e., the national real estate market, the Bay Area real estate market, etc.) and you lose the fineness of being able to use information strategically to make better decisions.



This effort forms the foundation of more effective strategies I advise my clients whether or not to buy or sell or just wait!



If you have any comments or questions, please feel free to post them here or send me an email at tom.mcevoy@remax.net.



Thanks for reading!

Community Calendar

Hello and Happy New Year! As we turn the page on another year, here are some events and on-going programs you might want to put on your calendar for January. These are selections from Sunnyvale, Cupertino, Mountain View, Santa Clara and other communities in Silicon Valley.



January 2, 9, 16, 23, 30: Kiwanis Club of Silicon Valley, 7:30am



Jan 2: American Association of Retired Persons (AARP), monthly, 1:30pm



Jan 3: SNAIL Neighborhood Association, monthly, 7:00pm



Jan 4: Heritage District Neighborhood Association, 7:30pm



Jan 5, 12, 19, 26: Farmer's Market, 9:00am



Jan 6, 13, 20, 27: Fair Oaks Toastmasters, 11:30am



Jan 9: Lakewood Village Neighborhood Association, monthly, 7:00pm



Jan 10: Wake Up Sunnyvale!, Sunnyvale Chamber Breakfast, 7:29am



Jan 12: Evenings of Cultural Arts Presents, Sunnyvale Theater, Sunnyvale Community Center, 8:00pm



Jan 14: San Miguel Neighbors Association, general meeting, 7:00pm



Jan 19: Compost Workshop, 10:00am



Jan 19: Household Hazardous Waste Drop-Off, 8:00am-1:00pm, Sunnyvale residents



Jan 19: Robert Burns Supper, South Bay Scottish Society, 6:00pm, Mountain View Masonic Lodge



Jan 21: Martin Luther King, Jr. Holiday



Jan 23: Glaucoma Support Group of the South Bay, 6:30pm



Jan 24: Sunnyvale Chamber Mixer, 5:00pm



Jan 26: Serving Children with Special Needs and their Families, 9:00am



Jan 26: California Theatre Center presents "The Adventures of Tom Sawyer", 11:00am



Mondays, Wednesdays, Fridays: Computer and E-Waste Recycling, 8:00am-4:30pm, Cupertino proof of residency



Every Wednesday: South Bay Community Orchestra, Noon-1:00pm for strings, 1:00-4:00pm for full orchestra



Every Saturday: Family Astronomy Evenings, De Anza College Minolta Planetarium, 6:00pm, 7:00pm or 8:00pm



Every Second Monday of Month: Fine Arts League of Cupertino, Quinlan Community Center, 7:00pm

Thanks for reading!

Welcome to My Behind the Real Estate Scenes in Silicon Valley Blog

Welcome to my blog -- Behind the Real Estate Scenes in Silicon Valley!





This blog will provide readers who want a bit more specifics about real estate topics than what you would normally find in a newspaper or online article which can be extremely general and perhaps meant to scare or sell newspapers rather than provide relevant, local information on real estate in our Silicon Valley communities. We'll delve into market and industry trends, strategies, tips for buyers and sellers, and even ideas and tips on improving or maintaining your home or investment properties.




Also, we will venture into non real estate areas too! Things like community and neighborhood events, charities, dining, etc. My blogs related to dining experiences will sport the name "Real Eats" and blogs about movie reviews and comments will be called "Reel Estate".




My name is Tom McEvoy. I've been a California licensed real estate broker for the past eight years. I'm a Realtor and was awarded the Seniors Real Estate Specialist designation because of my experience and education in dealing with seniors.




Prior to entering real estate, I was in corporate financial planning and analysis for 23 years ending as a Director of Financial Planning in 1999. My business, finance and investment experience allows me to provide comprehensive advice to my clients as well as interact effectively with CPA's, estate attorneys, loan officers, financial planners and other professionals so that my clients may be afforded top-level expertise so they make the best decision possible.




My associations and memberships include the Santa Clara County Association of Realtors, the California and National Associations of Realtors, Sunnyvale Chamber of Commerce, Better Business Bureau of Santa Clara County as well as a member of MLS Listings Inc. our Multiple Listing Service. I possess an MBA from Santa Clara University, a BS degree in Business Administration with a concentration in Finance from San Jose State University and an AA degree in Real Estate from Foothill College.




After working at two independent real estate firms during my first five years in business, I joined RE/MAX Santa Clara Valley, an independently owned and operated franchise, in early 2005. I have found it beneficial to belong to the largest realty member firm in the world with a network spanning more than 60 countries and comprising more than 120,000 agents. The power of RE/MAX extends to their widely-popular website http://www.remax.com/.




My business philosophy is to advise and educate my clients to enable them to achieve their real estate goals in the best possible manner. I am client-driven, not transaction driven and spend a great deal of time understanding my clients aims so that I can advise them on the appropriate strategy necessary to save them time and money.




The services I provide include helping people buy, sell or exchange residential and commercial properties. Properties include those occupied by the owners or those kept as investments. I serve clients from first time buyers of homes and income properties to trade up and trade down clients looking to meet goals due to changing life situations. In particular, I help senior citizens utilizing my designation of a Seniors Real Estate Specialist on whether or not to sell the family home, tax implications of selling income properties and the like. I also advise investor clients on exchanging properties to defer capital gains taxes through the use of Section 1031 of the IRS Tax Code.




Since I am client-oriented, my area of service is quite broad and mainly includes San Mateo, Santa Clara, Santa Cruz, Monterey, Alameda and Contra Costa counties. I have assisted clients outside this large area both in California and out of state with the help of a local professional that I team up with to assure my client receives the highest level of service at all times.





If you have any questions or suggestions for additional topics or subjects, please click comments below and post them here or contact me.






Thanks for reading!






To life's best,


Tom McEvoy, Realtor