Local Market Update
A Seller’s Market? Hard to believe, but many homes drawing multiple offers again as listing shortages continue My how things have changed in just one year! A year ago at this time, many homes were languishing on the market as buyers stayed on the sidelines, worrying about their jobs, the sharp decline in their 401k accounts, and whether housing prices would ever rise again. Today, many of those buyers have swallowed their fears and are out in force once again, spurred by an improving economy, a solid recovery in the financial markets, and federal home buyer tax credits that will expire this spring. While no one claims the housing market is out of the woods yet, an unusual dynamic is occurring in many communities around the Bay Area: Despite the choppy housing market, there is an army of confident, well-qualified buyers out searching for homes, but many sellers are now sitting on the sidelines! One listing in San Francisco’s Outer Mission neighborhood priced in the mid-$500,000 drew more than 100 groups during a two hour open house during the past holiday weekend. Inventory shortages continue to be the challenge in many areas. In Santa Clara County and the East Bay, for example, the number of homes for sale is standing at half of what it was a year ago! This has resulted in as many as half of the listings on the market attracting multiple offers as buyers fight it out for the best properties. This conundrum has resulted in prices rising even as sales are falling. DataQuick, the La Jolla-based research firm, reported that the median sale price of homes and condos in the Bay Area shot up almost 17 percent year over year in January while sales dipped 4 percent. The biggest jump in the median price was 18.3 percent in San Mateo, but all counties (except Napa) saw strong increases. Silicon Valley: Cupertino continues to see a severe shortage of homes for sale, with lots of multiple offers as buyers compete for good listings. In Los Altos, open house attendance is picking up as is overall activity, but the higher end market – above $2 million – is still slow. Similarly, things are slowly improving in the Los Gatos market with inventory and sales increasing. In San Jose’s Almaden and Willow Glen neighborhoods, inventory is gradually increasing although still far too low for buyer interest. Inventory in San Jose is half of what it was a year ago in all local markets, but sales are up between 30 and 70% depending on neighborhood. The Saratoga market started very slowly the first few weeks of January, but Realtors have seen a definite increase in activity.