Silicon Valley Real Estate Market Trend Report:

Santa Clara County (SCC): Sales Prices Weaken, Sales Down

The median sales price for single-family, re-sale homes fell, month-over-month, for the second month in a row. It was down 6% from May. Nevertheless, it was up 3.6% compared to last year. That’s the thirty-first month in a row the median sales price has been higher than the year before.

The average sales price for single-family, re-sale homes was down, month-over-month, for the third month in a row. It lost 4.1% from May. It was up 3.6% year-over-year.

The sales price to list price ratio fell from 112.6% to 106.3%. Multiple offers continue to be the norm.

Sales of single-family, re-sale homes were down for the tenth month in a row, year-over-year, in June. Sales fell 27.9%. There were 838 homes sold in Santa Clara County last month. The monthly average since 2000 is 987.

Pending sales were down 10.5% 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 fourth month in a row. It gained 78.4% compared to last year. As of July 5th, there were 1,108 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, rose from 31 days to 38 days. The average since 2003 is 89.

It took only fourteen 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 up 6.8% compared to last June. The average sales price gained 5.5% year-over-year.

Condo sales were down 37% year-over-year. There were 351 condos sold in May.

The sales price to list price ratio fell from 110.1% to 105.6%.

Condo inventory rose 22.5% compared to last June.

As of July 5th, there were 474 condos for sale in Santa Clara County. The average since January 2000 is 757.

Days of inventory rose from twenty-eight to thirty-nine.

It took an average of fourteen days to sell a condo last month.

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

The sales price to list price ratio fell from 112% to 110.1%.

Condo inventory rose 12% compared to last May.

As of June 5th, there were 412 condos for sale in Santa Clara County. The average since January 2000 is 757.

Days of inventory rose from eighteen to twenty-eight.

It took an average of twelve days to sell a condo last month.

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

June 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

A Half To Forget (SCC & SMC)

July 1, 2022 — The first half of 2022 will likely be remembered for a lot of things, but probably not fondly. Over this time, some of the major stock indexes put in their worst showing in over 50 years; inflation roared back to about 40-year highs, fixed mortgage rates just about doubled. Russia waged war against Ukraine, with sanctions disrupting energy, grain and other markets across the globe, while COVID-19 lockdowns in China again distorted supply chains, which are struggling to heal.

In addition to all this, the Fed embarked on what is expected to be its most aggressive monetary policy in more than 25 years, with successive short-term interest rate increases of 25, 50 and 75 basis points all happening within a span of about 60 days, and the promise of much more to come in the second half of 2022. To greater or lesser degree, other central banks are largely following suit.

Construction spending declined by 0.1% in May, a figure a bit below forecasts. Spending on residential projects usually powers the headline, but outlays for homes expanded by just 0.2%, the smallest increase since an oddball decline of -0.6% last July, and a rather hard downshift from sizable gains that ended 2021 and took place in the first four months of 2022. Spending on commercial, retail, industrial buildings and the like shrank 0.4%, a third consecutive decline, and public-works projects saw a 0.8% decline in May on the heels of a 0.3% drop in April. Demand for new homes is flagging a bit and there is already sufficient inventory to last for a bit, there are few bright spots in non-residential construction and funds from the federal “infrastructure” bill don’t much seem to be flowing as of yet.

Although conditions are less than optimal, it would appear that potential homebuyers are responding to improvement in the number of homes for sale. The National Association of Realtors Pending Home Sales Index (a measure of contracts signed) rose for the first time since last October, increasing by 0.7% for May, and lifting this measure of potential home sales from a three-and-a-half year low.

Home prices remain at or near record levels and mortgage rates at 13-odd year highs, but there remains considerable pent-up demand even with more marginal borrowers exiting the market due to unfavorable conditions. The PHSI’s increase may show up in sales of existing homes or June or July, depending on when closings of contracts actually take place.

Applications for mortgage credit have picked up recently, too. The Mortgage Bankers Association reported that there was a 0.7% increase in mortgage applications in the week ending June 24, a third consecutive positive week. That’s not something we’ve been able to say for some time, and the overall gain was lifted by a 0.1% increase in requests for purchase-money mortgages but surprisingly also by a 1.9% rise in those for refinancing. Of course, refi activity remains very low — last week was something close to 22-year lows for refi applications — so it probably doesn’t take many actual applications to move the gauge.

Provided this week’s market conditions can hold, there may be somewhat more opportunities for refinancing or snagging a lower rate for a purchase application. Few potential borrowers may notice, though, given that the July 4 holiday week often fully kicks off vacation season. The bond market rally we noted near the top of this Market Trends may or may not hold together once markets open next Tuesday morning, but there is a reasonable chance that at least a portion of the decline in yields will make it into retail residential mortgage rates next week.

We thought we might get as much as a tenth of a percentage point decline in 30-year FRM rates this week, and we did, and there’s a reasonable chance we could see that much of a decline or even somewhat more next week. Call it a 12-basis point decline in the average offered rate for a conforming 30-year fixed-rate mortgage as reported by Freddie Mac next Thursday morning.

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 Corner

S&P CoreLogic Case-Shiller Index Reports Annual Home Price Gain of 20.4%

NEW YORK, JUNE 28, 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 April 2022 show that home prices continue to increase across the U.S. 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): Home Sales Prices and Sales Fall in June

The median sales price for single-family, re-sale homes was down 6.7% compared to last year. That breaks the twenty-four month streak of the median sales price has been higher than the year before.

The average sales price fell 1.2% year-over-year.

The sales price to list price ratio fell from 112.9% to 108.9%.

After being higher, year-over-year, fourteen months in a row, sales of single-family, re-sale homes in San Mateo County fell for the tenth month in a row. They were down 29.6% in June. There were 309 homes sold in San Mateo County last month. The average since 2000 is 398.

Inventory of single-family, re-sale homes was up 53.7% compared to last year. As of July 5th, there were 472 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, rose from twenty-nine to forty-four days.

It took fifteen 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 rose 0.5% year-over-year.

Year-over-year, the average sales price rose 1.1%.

Condo sales were down 34.2% year-over-year. There were 106 condos sold last month. The average since January 2003 is 122.

Inventory was up 39.7% year-over-year.

As of July 5th, there were 183 condos for sale in San Mateo County. The average since January 2003 is 350.

Days of inventory rose from forty-three to fifty.

It took an average of nineteen days to sell a condo last month.

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

June 2022 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.