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 0.1% from April. It was down 7.1% compared to last year.
The average sales price for single-family, re-sale homes was up 1.3%, month-over-month. It was down 7.6% year-over-year.
Sales of single-family, re-sale homes were down for the seventeenth month in a row, year-over-year, in May. Sales fell 16%. There were 747 homes sold in Santa Clara County last month. The monthly average since 2000 is 987.
The sales price to list price ratio rose from 104.8% to 105.4%.
Pending sales were down 6.3% year-over-year.
Inventory of single-family, re-sale homes was down for the second month in a row. It fell 37.7% compared to last year. As of May 5th, there were 647 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 36 days to 26 days. The average since 2003 is 89.
It took eighteen 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 10.9% compared to last May. The average sales price fell 6.5% year-over-year.
Condo sales were down 36.3% year-over-year. There were 283 condos sold in May.
The sales price to list price ratio rose from 103.2% to 103.4%.
Condo inventory was down 52.2% compared to last May.
As of May 5th, there were 221 condos for sale in Santa Clara County. The average since January 2000 is 757.
Days of inventory fell from thirty to twenty-three.
It took an average of eighteen days to sell a condo last month.
If you are planning on selling your property, call me for a free comparative market analysis.
May 2023 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
Uncertainty Regarding Pause Increasing (SCC & SMC)
Jun 2, 2023 — It’s starting to feel like any decision to pause rate hikes by the Fed — even for a single meeting — is going to be a close call. The Fed has theoretically moved to a more data-dependent decision process for monetary policy, as it tries to manage both the lagged economic effects of previous rate hikes and the forward uncertainty created by bank stresses earlier this spring. Since the last Fed meeting, the available data hasn’t suggested much by way of a continued cooling in the economy, additional slackening in the labor market or a more appreciable downturn for prices, making the upcoming decision on holding rates steady rather less certain than it seemed a few weeks ago.
Should an economic downturn come, and depending on the shape and form that it takes, the overall housing market may actually do surprisingly well in such conditions. Most typically, the drop in overall demand for goods and services helps lower inflation; this in turn helps lower long-term mortgage rates, sparking refinancing and luring potential homebuyers back into the market, and of course the Fed may look to cut rates, too. Of course, much well the housing market does would depend on how the job market performs during this time as well as other factors, but it’s not uncommon for the housing market to lead the way out of a recession.
We don’t have a recession right now, and we certainly don’t have the low interest rates (or other conditions) that would help stoke the housing market. The opposite of this is more the case at the moment, and headwinds remain, but that’s not to say there are no signs of life here and there for housing.
For example, existing home sales remain burbling along at a low level. Sales did decline a little bit more in April, falling by 3.4% compared to March, and are about 21% below year ago levels. That’s actually an improvement of sorts, since existing home sales were down by 37% compared to a year ago as recently as February. Year-ago comparisons will start to look more favorable before long; for example, if the present annual rate of sales holds through July, the same year-ago comparison will show just a 12.3% decline, and so on.
This is also something to consider when looking at what’s happening with home prices. On a monthly basis, the median price of an existing home sold peaked in June 2022 at $413,800; by January of this year, it hit a seasonal bottom of $361,200 — about a 12.7% decline. Since that bottom, that same median price has picked up by 7.6% to $388,800 — and is only about 6% below last year’s peak. Direct annual comparisons — e.g. April to April, May to May, etc. — will continue to look highly unfavorable, since prices in 2022 were still increasing until June while prices in 2023 aren’t likely to firm up a whole lot more unless mortgage rates decline meaningfully and spark more buyer demand.
As has been the case, tight inventories of homes for sale continues to provide support for prices, but also serves to throttle the volume of sales. The traditional spring homebuying season is looking like a modest one at best this year amid still-considerable headwinds. With a measure of pending home sales (signed contracts to buy) fading or only holding steady at a low level, it doesn’t appear that even the current modest level of demand that has helped prop up prices this spring is likely to continue. As such, home prices may resume settling as the year progresses.
Rather opposite conditions are being seen in the market for newly constructed homes. When sales slowed appreciably last year from high interest rates and high new home costs, builders began to take steps to stem and reverse the downtrend, offering things not available in the existing home market, such as considerable price concessions or subsidized financing offers. As well, the new construction market offers supply elasticity — that is, more homes can be built to meet demand. At the same time, it is true that most large-scale residential housing construction takes place at greater distances from center cities, and so isn’t a direct substitute or exchange for a greater supply of existing homes to buy, and is not a perfect fit for all buyers.
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 Rebound Continued in March
NEW YORK, MAY 30, 2023: 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 March 2023 show a continuing recovery in housing prices, as all 20 major metro markets reported month-over-month price increases. 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 twentieth month in a row, year-over-year. They were down 28% in May. There were 275 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 4.5% compared to last year.
The average sales price fell 11.4% year-over-year.
The sales price to list price ratio rose from 102.4% to 104.3%.
Inventory of single-family, re-sale homes was down 5.6% compared to last year. As of June 5th, there were 385 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 fifty-six to forty-two days.
It took twenty 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 14.1% year-over-year.
Year-over-year, the average sales price fell 1.7%.
Condo sales were down 33.1% year-over-year. There were 83 condos sold last month. The average since January 2003 is 122.
Inventory was down 28% year-over-year.
As of June 5th, there were 134 condos for sale in San Mateo County. The average since January 2003 is 350.
Days of inventory fell from sixty-nine to forty-eight.
It took an average of twenty-six days to sell a condo last month.
If you are planning on selling your property, call me for a free comparative market analysis.
May 2023 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.