Foreclosures are affecting all areas and price points (for the most part). Even if there aren’t any foreclosures on your street, they will still pull your prices down because buyers are drawn to those homes first before buying the house that might be for sale on your street. We are still seeing a buying frenzy around the $400k-$500k price point.
Finally, the Palo Alto market shows the same “speed bump” in prices -- down 35% from the average prices one year ago. If you’re thinking of moving up to the Palo Alto schools, there may never be a better window for you than 2009.
Again, each chart shows the percent CHANGE over the prior year in both the Average Sales Price and the Median Sales Price for a given area -- enjoy!
Chart Analysis:
Almaden Valley seems to be stable at 10% to 15% off prices from one year ago. As I mentioned last month, this may be the best discount you will expect to see in Almaden. However, there was a fantastic 2000 square foot foreclosure home in Almaden this month at $799k -- that was a steal! If there are more on the horizon then surely we will see a lower average sales price.
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Blossom Valley continues to be the weakest MLS area we cover. Foreclosures are everywhere and prices are easily 25% off last year -- and some sales are 40% off their high of 2005. There are great values to be had here for a first time buyer.
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Willow Glen prices are deflated somewhat by the short sales and foreclosures that are being sold in the pocket of homes North of Willow near 87. But, it isn’t unreasonable to believe that you can have a nice Willow Glen home for somewhere around 20% off last year’s price. We even wrote about the phenomenal deal on the first Willow Glen Eichler foreclosure priced at $675k.
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Downtown San Jose is still dominated by distressed sales -- but look at that uptick! I think it is bottoming out around 35% off prices from a year ago, and that seems to be attracting new buyers in to snap up these deals.
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Cambrian continues to see the impact of the “foreclosure earthquake” as I have called it. I continue to promote this area as a great opportunity for first time buyer and those looking to get into the good Union schools at a great price. Most of Cambrian is ON SALE right now!
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Campbell may be bouncing off a bottom. There are a few foreclosure properties on the low-end starting to creep into the sales numbers but not nearly to the degree of neighboring Cambrian. If this is all we get in distressed sales you may want to think about making your Campbell move sometime soon as it doesn’t look like prices will continue to slide too far.
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Los Gatos will continue to look “spiky” due to the lower number of sales from which to generate these averages. I’m hearing “rumors” that some Los Gatos owners who over-paid during the price run up a few years ago are having difficulty keeping up with their payments as the economy softens. If true, we may see some distressed sales coming in Los Gatos over the next few quarters.
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Saratoga continues to amaze me. It continues to have the lowest Pending-To-Active ratio in the county at 6.6% (even lower than last month), which is to say that very few homes are under contract with Buyers, and inventory of unsold homes is growing. I’ve been saying that Sellers will need to begin adjusting their prices down to get moved but we are just not seeing it yet. I’m ok admitting I’m wrong (or maybe I’m just early…)
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Santa Clara seems stable around the 15%-20% off mark. There are MANY foreclosures in the area between Monroe and the railroad tracks which are keeping prices down so if you are looking to get into Santa Clara, that is where to begin your search.
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Sunnyvale is continuing to get hammered right now. Most of Sunnyvale has prices down about 15%, however the Lakewood areas North of 101 have dozens of foreclosures and short sales that are selling in the $400s. They are pressuring the overall sales numbers for Sunnyvale and will continue for many months to come. If you are looking to get into Sunnyvale under $500k, now is the time!
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Cupertino prices looked like they are falling off a cliff last month and now they are holding steady. The average sales price for Cupertino is back up to $1M. The steepest discounts may be behind us so the best you can hope for now is about 15% off the year ago prices. The next month or 2 should tell us more about where the true “trend” is headed.
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Los Altos has an interesting chart at this point. If you look at this chart as a stock, I would say it looks like lower “highs” and lower “lows”, which means it is still searching for a bottom. There are still so few transactions (only 10 sales in December, compared to 18 a year ago) so it is somewhat challenging to call a true “trend”.
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Mountain View is showing a pop! Maybe that’s the Google-effect?! Since there have been several months since the September low, I might feel ok saying that Mountain View prices are bouncing off a bottom.
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Palo Alto is trending exactly as I wrote last month. The “on sale” season for Palo Alto may be just starting (instead of coming to an end as I hedged) based on this chart. I was right in that a high number of price-reduced properties are being sold and as they are recorded, we see prices down coming down 30% compared to a year ago.
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I hope this has been useful. If you’re buying or selling, I will always tell you that timing the market is impossible and unwise. We bring you this information to help you make an intelligent decision about your next move and get over the paralysis that often grips us due to fear of the unknown.
The reasons behind your motivation for buying or selling (like getting married and want your first home; just had a baby and need a bigger place; want your children to get into a better school; loved one passed away; job transfer out of the area; or looking for your first investment property) should outweigh the concerns of market timing. The market is always here, people are buying and selling every day -- are YOU personally ready to make a move is the real question.
-mark
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