Silicon Valley Real Estate Market Trend Report:

Santa Clara County (SCC): Home Inventory Down 5th Month in a Row

Inventory of single-family, re-sale homes was down 39.2% compared to last year. As of February 5th, there were 507 homes for sale in Santa Clara County. The average since January 2000 is 2,703.
The median sales price for single-family, re-sale homes in January was down 0.3% compared to last year. It was down 3.1% from December.
The average sales price was up 2.5% year-over-year. It was down 3.2% compared to December.
The sales price to list price ratio jumped to 100.9% from 100.1%. Agents have been reporting a surge in multiple offers.
Home sales dropped 39.6% from December. That is typical for December/January. They were up 7.8%, year-over-year. There were 389 homes sold in Santa Clara County last month. The average since 2000 is 987.
Days of Inventory, or how long it would take to sell all homes listed for sale at the current rate of sales, jumped 18 days to 39 days compared to December. The average since 2003 is 89.
It is taking forty-one days to sell a home. That is the time from when a home is listed for sale to when it goes into contract.
The median sales price for condos was down 0.3% compared to December, but, it was up 2.0% from last January.
The average sales price fell 2.0% from December, but, it was up 3.3% year-over-year.
The sales price to list price ratio rose to 99.6% from 99.4%.
Condo sales were up 43.6% year-over-year. They were down 24.8% from December. There were 191 condos sold in January.
Condo inventory dropped 47.2% from last January.
As of February 5th, there were 216 condos for sale in Santa Clara County. The average since January 2000 is 757.
Days of inventory rose to thirty-four from twenty-nine.
It took an average of fifty-two days to sell a condo last month.
If you are planning on selling your property, call me for a free comparative market analysis.

January 2020 Sales Statistics (SCC)

* Total inventory is active listings plus pending listings. Active listings do not include pending.

More information is available in our on-line report at http://avi.rereport.com/market_reports

Closing The Books On The 2010s (SCC & SMC)

Jan. 31, 2020 — Although the spreading corona virus probably doesn’t meet the classic definition of a pandemic just yet, that’s less the case for investor psyches, where concerns about the impacts of the spreading disease have caused widespread selloffs of riskier assets such as equities this week. In turn, those funds have been flowing strongly into safe-haven investments such as Treasury and other sovereign bonds (and to a lesser degree, Mortgage-Backed Securities), driving yields and mortgage rates down in kind.

It’s still too early to know the full impact, but it seems likely that there will be at least some economic slowing in some economies around the globe, but where and how much have yet to play out. While unfortunate in many ways on a broad scale — not the least of which for those who have been or will be directly impacted — it is fortunate for American mortgage shoppers, who are seeing rates again approaching multi-year lows. This week’s average rate for a conforming 30-year FRM is only 20 basis points above (what were then) 60+ year lows achieved back in 2012, and although rates may not fall that far, the economic conditions in which they are occurring (a record-long expansion, near-full employment, rising incomes) means that there is a chance that more folks will be in a position to take advantage of them.

Or at least they would, if interest rates hadn’t been for the most part within about a percentage point of these rate for the past few years. Incrementally lower rates should mean incremental increases in refinance activity, and may, but there have been an awful lot of refinances at rates near enough to today’s levels over that time as to have tempered any pent-up demand. Still, we should see a boost in activity, even above the 7.5% increase in applications for refinance mortgages reported by the Mortgage Bankers Association of America in the week ending January 24… and rates have moved lower this week again.

Can lower rates help create more home sales? Yes… but since there is a dearth of homes available to buy on the market (inventory levels of existing homes were at about a 20-year low in December, according to the National Association of Realtors) so a ramp up in sales seems unlikely. In fact, the Realtors reported that their Pending Home Sales Index dropped by 4.9% in December, with the decline attributed to a lack of homes for sale and a spike in home prices toward the end of 2019 that has again crimped affordability.

Some potential borrowers may look to new construction instead, where supply is less of an issue, but prices tend to be higher to start with and homes may be being built in places that are less optimal, such as away from transportation options or a long distance to a center-city job. Sales of new homes eased a little in December, falling by 0.4% to 694,000 (annualized) units sold. Unlike existing homes, there is a 5.7 month supply of newly-constructed units available (a five-month high, and close to optimal), and median prices of new homes sold have waxed and waned from month to month but are just 0.5% higher this December than they were last December. As such, the relative improvement in affordability produced by lower mortgage rates is largely preserved and may make the stretch to a new home possible for somewhat more potential homebuyers. As with refinances, applications for purchase-money mortgages rose last week, gaining 5.3%.

A large selloff in major stock indices here on Friday will no doubt see overseas market start the next trading week on a sour note, and the downward pressure on rates will continue. Despite a largely positive economic climate, the effects of the spreading pandemic has already blown out the bottom of out most recent Two-Month Forecast, and that seems like a trend that will continue next week. We think by the time Freddie Mac reports next Thursday morning that another handful of basis points will be shaved off the average offered rate for a conforming 30-year fixed-rate mortgage, putting us closer to historic lows again. A couple of basis point fall would put us on full par with last September; a 4 to 9 basis point decline drops us back October 2016 levels… 11 sees us at July 16… but a dozen or more and we’re back at 7-year lows.

Call or email me if you have any questions.

For further details and a city-by-city breakdown statistics, go to http://avi.rereport.com/market_reports.

Real estate related Articles

California homeowners interested in building accessory dwelling units on their property just caught a break, potentially shaving off thousands of dollars in fees and permits.

In a move proponents say will help ease the Bay Area’s housing crisis, Gov. Jerry Brown on Tuesday signed Senate Bill 1069, making the so-called “granny units” easier and less expensive to build throughout the state.

For more read California eases restrictions on ‘granny units’

and http://www.hcd.ca.gov/policy-research/AccessoryDwellingUnits.shtml

Helpful resource for home owners

Many new home owners or owners who consider remodeling or rebuilding their homes should take advantage of their county Tax Assessor web site. These web site and their respective city building departments web site typically have vest information regarding the process for applying for permits, the impact on their taxes and many other resources that home owners should be aware are available for them.

For the San Mateo County Tax Assessor office visit http://www.smcare.org/default.asp

For Santa Clara County Tax Assessor visit https://www.sccassessor.org/index.php

The Silicon Valley 150 Index Corner

The Silicon Valley’s Real estate market is a derivative of the local economy–it prospers and withers depending on how well the local innovation-based sector performs. The San Jose Mercury News tracks the performances of the largest 150 publicly traded companies headquartered in Silicon Valley through an index called the SV150, which may be found at www.mercurynews.com. Stocks are valued based on several criteria, but one of the more important criteria is a company’s future earnings. Therefore, I see the SV150 as a leading indicator for Silicon Valley’s real estate market.

Investors Corne

S&P CORELOGIC CASE-SHILLER INDEX CONTINUES UPWARD TREND FOR ANNUAL HOME PRICE GAINS
NEW YORK, JANUARY 28, 2020 – S&P Dow Jones Indices today released the latest results for the S&P CoreLogic Case-Shiller Indices, the leading measure of U.S. home prices. Data released today for November 2019 show that home prices continue to increase at a modest rate across the U.S. More than 27 years of history are available for these data series, and can be accessed in full by going to Read more

U.S. Housing Markets Moving Into Rent Territory for First Time in Over 8 Years: Report

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San Mateo County (SMC): Home Sales & Prices Mixed to End the Year

The median price for single-family, re-sale homes was down, year-over-year, by 1.9%. The average price, on the other hand, was up 2.7%.
Both the median and average sales prices were down compared to November: 8.4% and 8.6% respectively. This is a common occurrence at the end of the year.
The sales price to list price ratio dropped from 103.0% to 102.1%.
Home sales dropped 13.7% from November, but, they were up 17.8%, year-over-year. There were 271 homes sold in San Mateo County last month. The average since 2003 is 398. For the year, home sales were down 1.7%.
Inventory was down for the fifth month in a row, dropping 21.6% compared to last year.
Days of Inventory, or the amount of time it would take to sell all homes for sale divided by how many homes have sold, fell ten days to twenty-four days.
As of January 5th, there were 221 homes for sale in San Mateo County. The average since January 2003 is 1,287.
It took thirty-nine days to sell a home last month. That is up from twenty-five in November. That is the time from when a home is listed to when it goes into contract.
The median sales price for re-sale condos fell 5.1% year-over-year. It was up 4.5% from November. The average sales price rose 1.6% from November. Year-over-year, the average sales price fell 9.7%.
Condo sales rose 65.2% year-over-year. For the year, condo sales were up 2.8%.
After being higher than the year before sixteen months in a row, inventory fell 9.1% year-over-year. It was down 49.3% compared to November.
As of January 5th, there were only 70 condos for sale in San Mateo County. The average since January 2003 is 350.
Days of inventory dropped to thirty-eight from forty-two.
It is taking thirty-four days to sell a condo.
If you are planning on selling your property, call me for a free comparative market analysis

If you are planning on selling your property, call me for a free comparative market analysis.

January 2019 Sales Statistics (SMC)

Call or email me if you have any questions.

For further details and a city-by-city breakdown statistics, go to http://avi.rereport.com/market_reports.