Santa Clara County (SCC): Market Continues to Weaken
The median sales price for single-family, re-sale homes fell, month-over-month. It was down 7.7% from November. It was down 16.3% compared to last year.
The average sales price for single-family, re-sale homes was down 8.7%, month-over-month. It was down 17.4% year-over-year.
Sales of single-family, re-sale homes were down for the sixteenth month in a row, year-over-year, in December. Sales fell 40.7%. There were 409 homes sold in Santa Clara County last month. The monthly average since 2000 is 987.
The sales price to list price ratio fell from 99.6% to 98.7%.
Pending sales were down 3.1% year-over-year.
After being down, year-over-year, thirty months in a row, inventory of single-family, re-sale homes was up for the tenth month in a row. It gained 140% compared to last year. As of January 5th, there were 492 homes for sale in Santa Clara County. The average since January 2000 is 2,703.
Days of Inventory, or how long it would take to sell all homes listed for sale at the current rate of sales, fell from 43 days to 36 days. The average since 2003 is 89.
It took thirty-two days to sell a home last month. 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 9.4% compared to last December. The average sales price fell 11.5% year-over-year.
Condo sales were down 46.7% year-over-year. There were 171 condos sold in December.
The sales price to list price ratio rose from 98.8% to 99.2%.
Condo inventory was up 114.3% compared to last November.
As of January 5th, there were 225 condos for sale in Santa Clara County. The average since January 2000 is 757.
Days of inventory fell from forty-one to thirty-nine.
It took an average of thirty-three days to sell a condo last month.
If you are planning on selling your property, call me for a free comparative market analysis.
December 2022 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 Out 2022 (SCC & SMC)
Dec 30, 2022 — The calendar is set to turn again, as we’ll say “farewell” to 2022. As far as mortgage and housing markets goes, it’s likely that many would add “good riddance” to this sentiment. The year will close with 30-year fixed mortgage rates nearly double where they began 2022, but this can actually be called an improvement of sorts, as they have recently retreated from more than 20-year highs. Of course, those high mortgage rates not only crushed homeowner refinance activity, but were also accompanied by record-high home prices this year. The combination of the two significantly impacted affordability for potential homebuyers, who have retreated to the sidelines to await better conditions.
Of course, spiking interest rates were brought on by inflation running up to a 40-odd year high and a Federal Reserve abruptly changing policy. The year began with short-term rates still near zero and the central bank still tapering its purchases of Treasury bonds and Mortgage-Backed Securities. The Fed accelerated its timeline for QE wind-down, and as soon as that was complete began to tighten monetary policy, first raising rates a small step, then in repeated large blocks. For the year, a total of 425 basis points was added to the federal funds rate, and this aggressive policy upended stock, bond and housing markets.
It would appear that inflation is now slowing, but not likely enough to give the Fed pause. The labor market remains very tight, with millions more job openings that workers willing (or perhaps able or qualified) to fill them. Goods-based inflation has waned appreciably, but more sticky service-related price pressures have shown few signs of abating as yet. The Fed still believes it has more work to do to tame inflation, but it’s likely we’re getting close to the end of routine or sizable rate hikes, but the future as always remains unclear.
A minor easing for mortgage rates helped sales of new homes to pick up a little bit in November, and they rose by 5.8% compared to October. That said, the 640,000 annualized pace is still some 15.3% below the same period a year ago, and sales for the October and September were both revised downward, taking a little steam out of November’s improvement. Regardless, the bump in sales drew down the stock of available new homes for sale to 461,000 units (annualized), the first meaningful decline after a near-unbroken string of increases that started back in October 2020.
Even so, the current supply figure is about as high as it was back in April 2008, and represents an 8.6-month supply at the present rate of sale. As we noted in Market Trends last week, builders have reported a greater use of financing incentives to help clear inventory, with only about a third of them reporting cutting prices to sell homes. The median price of a new home sold in November was just 2.8% lower than those sold in October, and the current $471,200 price tag remains very close to record highs in spite of the decline.
We learned last week that sales of existing homes continued to slow in November, where the annual rate of homes sold declined by another 7.7% to 4.09 million. Excluding the pandemic hard-shutdown month of May 2020, this was the lowest annual rate of sale since back in 2011. Anyone looking for a near-term pickup in sales is likely to be disappointed, as the Pending Home Sales Index from the National Association of Realtors shrank by another 4% in November. The PHSI’s value of 73.9 is the second lowest in the 20-plus year history of the indicator; only May 2020 (pandemic month) was lower at a reading of 69, and the level of purchase activity is 37.8% below year-ago levels.
The PHSI measure of signed purchase contracts is an indication of existing home sales a month or two into the future, so more declines in sales can be expected to be seen in December and perhaps even January’s data. A 4% decline from November’s 4.09 million sales pace suggests around a 3.95 million (annualized) rate of sale for December, and that only if all the contracts signed actually make it to closing.
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.
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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 Corner
S&P CoreLogic Case-Shiller Index Decelerated In September
NEW YORK, DECEMBER 27, 2022: S&P Dow Jones Indices (S&P DJI) 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 October 2022 show that home price gains declined across the United States. More than 27 years of history are available for the data series and can be accessed in full by going to CLICK HERE
U.S. Housing Markets Moving Into Rent Territory for First Time in Over 8 Years: Report
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San Mateo County (SMC): Market Continues to Weaken
Sales of single-family, re-sale homes in San Mateo County fell for the fifteenth month in a row, year-over-year. They were down 40.5% in November. There were 220 homes sold in San Mateo County last month. The average since 2000 is 398.
The median sales price for single-family, re-sale homes was down 19.2% compared to last year.
The average sales price fell 5.3% year-over-year.
The sales price to list price ratio fell from 100.4% to 98.9%. That’s the first time the ratio has been below 100% since March 2012.
Inventory of single-family, re-sale homes was up 85.6% compared to last year. As of December 5th, there were 399 homes for sale in San Mateo County. The average since January 2000 is 1,287.
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 from sixty-two to fifty-three days.
It took twenty-five days, on average, to sell a home last month. 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 7% year-over-year.
Year-over-year, the average sales price fell 8.7%.
Condo sales were down 26.7% year-over-year. There were 77 condos sold last month. The average since January 2003 is 122.
Inventory was up 13.4% year-over-year.
As of December 5th, there were 144 condos for sale in San Mateo County. The average since January 2003 is 350.
Days of inventory fell from sixty to fifty-four.
It took an average of forty-six days to sell a condo last month.
If you are planning on selling your property, call me for a free comparative market analysis.
December 2022 Sales Statistics (SMC)
* Total inventory is active listings plus pending listings. Active listings do not include pending.
You can get more information at: http://avi.rereport.com/market_reports
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.