It's hard to believe we are almost into our 3rd month of 2012! This year's housing market is back in full swing and new Spring inventory has (slowly) begun to hit the Silicon Valley real estate market. Our local economy is in a state of growth. There is much anticipation surrounding the tech world, the recent IPO's and some upcoming ones. Buyers are taking advantage of low interest rates and house hunting for themselves or as an investment. Sellers are taking advantage of the pre-summer housing market and increased buyer demand by listing their homes at strong prices. All seems to be well in our housing world, except the reality that there is just not enough housing inventory to meet this demand. We have 50% less housing inventory today than we have had in the last five years. In Santa Clara County, we have only 1.7 month's supply and in San Mateo County only2.2 months. So what type of market has this created? Well for one, we have slowly shifted into a seller's market. In certain neighborhoods throughout Silicon Valley (namely Mountain View, Los Altos, Menlo Park, Palo Alto, parts of Redwood City and Burlingame), it has created quite a competitive multiple offer market (in the $500K-$2M price point), a bidding war if you will, and in some cases, very frustrated buyers. If you are a buyer in the market this year you have probably noticed this if not been involved in a multiple offer transaction yourself. Now don't get me wrong, now is a terrific time to buy. But for buyers in this market, it will require added time, patience and a great offer strategy/package with strong price, terms and conditions (which is where I come in to help you get there!). Just last week a house on Georgia Street in Palo Alto sold with 38 offers and $500K over the asking price of $1,195,000 (I think the house was priced too low to begin with). The week before a house on Todd Street in Mountain View sold with 16 offers.
The dire inventory situation that is driving this demand and upward pressure on prices will certainly improve as the year unfolds, but those sellers who wait until the summer months will also be competing against all of the other listings at the peak season. So for those sellers thinking about putting their house on the market, now (in my opinion) may be a good time and a window of opportunity.
Bay Area Home Sales Reach 5-Year High for January - Bay Area Biz Journal "Bay Area home sales rose in January to the highest level for the month in five years, the research firm Dataquick reported. It attributed the jump to lower prices, ultra-low mortgage rates, a modestly improved economy and a record level of investor purchases."
How did the Silicon Valley real estate market perform in January? Here is the scorecard: