Prices Are Way Up, Inventory Way Dow

November 23, 2017 By dpizano

The California Association of Realtors reported that the median sold prices of existing homes in the San Francisco Bay area for October 2017 is $892,720. Last year the median sold price was $803,190. This represents a yearly price increase of 11.1% year over year.

In Santa Clara County the median sold prices of existing homes was $1,242,500 for October 2017. Last year the median price was $1,047,500. This means that the median home price went up 18.6% from last year.

According to the Nov 14, 2017 article by HSH.com titled “The salary you must earn to buy a home in the 50 largest metros,” you must earn a household income of $216,181 to buy a median priced home in San Jose. The study has the median home price in San Jose at $1,165,000 and the interest rate at 4.12% with a 20% down payment and the PITI monthly payment (Principle, Interest, Taxes, Insurance) at $5,044.23.

Lawrence Yun, the chief economist for the National Association of Realtors says, “Affordability pressures are frustratingly occurring in places where jobs are plentiful and incomes are rising. Without a significant boost in new and existing inventory to alleviate price growth, job creation could slow in high-cost areas in upcoming years if residents begin exiling to more affordable parts of the country.”

The number of homes on the market in San Jose, CA as of November 23, 2017 is 171 sfh and 41 condo/town homes. The number of pending homes on the market are 454 sfh and 177 condo/town homes. There are close to 3 “pending” single family homes for each available “active” home for sale in San Jose. There are more than 4 condos/town homes that are “pending” status for every one “active” condo/town home on the mls. The sfh and c/th ratio are: 1:3 and 1:4 respectively. Bottom line is that there are not enough homes for sale to feed the strong buyer demand.

How Does the Fed Rate Hike Affect Mortgage Interest Rates

February 5, 2016 By dpizano

So what happens when the Fed raises the Fed rate?

The important thing to remember is that the Fed interest rate and the mortgage rate are two completely different things.

The interests rates are still at an all time low point. Most economist do not see the interest rates going up anytime soon. They should stay at around 4% for a 30 year rate for a while and this will help buyers better afford a home and mortgage payment.

According to Ed Yardeni of Yardeni Reasearch the mortgage rates are more closely tied to the bond market rather than the Fed funds rate.

Ed Yardeni explained in a recent CNN Money article that if the mortgage interest rate went up to 4.5% by the summertime, that would cost an extra $700 per year or $58 per month on $200,000 mortgage loan.

When the mortgage rates go up the price of homes stop going up so fast. This would be welcomed by most buyers in today’s real estate market. For example, in Cambrian with zip code 95118 the Median Sales Price for Single Family Homes in January 2016 was up 25% to $1,075,000 from a year ago.

The Fed is expected to raise rates slowly over time and some experts think that the they may have to cut them again if the global economy does not improve.

According to CNN Money, when interest rates reach 5% that would signal a turning point. The small increases mostly affects those homeowners that are still looking to refinance their mortgage loans.

Santa Clara County Real Estate Update

January 31, 2016 By dpizano

December 2015

Property Sales in Santa Clara County (Single Family Homes)

December property sales were 889, up from 742 in December of 2014 and 23.6% higher than the 719 sales last month. December 2015 sales were at their highest level compared to December of 2014 and 2013. December YTD sales of 10,848 are running 5.4% ahead of last year’s year-to-date sales of 10,288.

Prices

The median sales price in December was $917,000, up 9.1% from $840,500 in December of 2014 and down -3.9% from $954,000 last month. The average sales price in December was $1,155,749, up 7.1% from $1,079,317 in December of 2014 and down -4.4% from $1,208,762 last month. December 2015 ASP was at highest level compared to December of 2014 and 2013.

Inventory

The total inventory of properties available for sale as of December was 539, down -36.8% from 853 last month and down -16.4% from 645 in December of last year. December 2015 Inventory was at the lowest level compared to December of 2014 and 2013.

Market Time

The average Days On Market (DOM) shows how many days the average property is on the market before it sells. An upward trend in DOM tends to indicate a move towards more of a buyer’s market, a downward trend a move towards more of a seller’s market. The DOM for December was 32, up from 28 days last month and down from 34 days in December of last year. The December 2015 DOM was at its lowest level compared with December of 2014 and 2013.

Selling Price Per Square Foot

In December 2015, the price per square foot for a single family home in Santa Clara County was $571. This is a 12% increase from last year in December of $510 per square foot.

Selling Price vs Listing Price

The selling price per square foot is a great indicator for the direction of property values. Since median sales price and average sales price can be impacted by the ‘mix’ of high or low end properties in the market, the selling price per square foot is a more normalized indicator on the direction of property values. The December 2015 selling price per square foot of $628 was down -4.3% from $656 last month and up 10.4% from $569 in December of last year.

Inventory / New Listings / Sales

The selling price vs listing price reveals the average amount that sellers are agreeing to come down from their list price. The lower the ratio is below 100% the more of a buyer’s market exists, a ratio at or above 100% indicates more of a seller’s market. The December 2015 selling price vs list price of 102.4% was down from 102.6% last month and up from 102.2% in December of last year.

Real Estate in Cambrian Park in San Jose slows down a bit in November 2015

December 29, 2015 By dpizano

Cambrian Park is a nice suburban area close to Willow Glen, Los Gatos, Almaden Valley and Campbell. The zip codes are 95124 and 95118.

There were 45 single family home sold in November. This number is down -2.2% from 46 in November of last year and lower from 61 homes sold in October 2015. When we compare the Year to Date (to November 2015) sales of single family home to those of the previous two years, the sales are around 3% lower (620 2015 YTD, compared to 639 YTD in 2014).

When we look at the home values in Cambrian Park in San Jose the median price single family home increased from $855,000 to $922,000 for a year to date gain of 7.8%. However, the median price went down slightly from October $925,000 to November 2015 $922,000.

The average List Price to Sales Price in Cambrian was is 107% for the year, meaning that if a home is listed for $100,000 it eventually sells for $107,000 or 107 percent over the asking price. This tells us that there are still plenty of multiple offers for home selling in Cambrian. In November 2015, however, the average List Price to Sales Price dropped to 103.5%.

Another factor we like to measure is Days on Market. In other words, how long does the average home sit on the mls before it gets sold. The average Days on market for Cambrian homes for sale was this year was 19 days. However, in November the Days on market went way up to 29 days. It took longer to sell a home in November this year.

Third Straight Month of Decline in September 2015

October 29, 2015 By dpizano

US Housing Data in September 2015

The national median existing home price in September 2015 was $221,900. Which is an increase of 6.1% from a year ago. Last year the median price was $209,100. However, on a month to month statistic, it is the third straight month of decline. According to Lawrence Yun, Chief Economist for NAR, “This (decline) always occurs after the summer months, there’s no surprise.”

Lawrence Yun explains, “Despite persistent inventory shortages, the housing market has made great strides this year, backed by an increasing share of pent–up sellers realizing the increased equity they’ve gained from rising home prices and using it towards trading up or moving into a smaller home.” He explains the first time home buyers challenge, “Unfortunately, first time buyers are still failing to generate any meaningful traction this year.” When compared to the entire buying population, first time home buyers fell to 29% of all buyers in September of 2015 after climbing to their high’s of 32% in August 2015. Last year the first time home buyer was very similar and made up 29% of all buyers.

California Housing Data for September 2015

When we look at the housing data on a statewide level. September’s statewide median home price was $482,150 which is down 2.3% from August 2015. The median number of days it took to sell a single-family home edged up in September 2015 to 32.6 days compared with 29.9 days in August 2015. The Bay Area is the only region where homes are selling above original list prices due to constrained supply with a ratio of 102.4% in September 2015, up from 101.2% a year ago September 2014.

Santa Clara County data on SFH September 2015

September SFH Property sales were 941, up 3.2% from 912 last year September 2014 and -7.9% lower than the 1,022 sales last month in August 2015. January through September 2015 Year To Date sales of 8,363 SFH sold are running 6.6% ahead of last year’s YTD sales of 7,846 SFH Sold.

Median SFH Sales Price in September 2015 was $950,000, up 11.9% from $849,000 in September of 2014 and down -1.7% from $966,200 last month in August. The Average Sales Price for Single Family Homes in September was $1,232,555, up 11.8% from $1,102,154 in September of 2014 and down -0.9% from $1,244,275 last month in August 2015.

Total Inventory of SFH Properties available for sale as of September was 1,450, up 4.7% from 1,385 last month and down -7.1% from 1,560 in September 2014.

Average Days On Market (DOM) for SFH shows how many days the average Single Family Home is on the Market before it sells. An upward trend in DOM a buyers market, a down trend a sellers market. The DOM for September 2015 was 22 Days On Market which remained unchanged from last month in August but down -18.5% from a 27 Days on Market in September 2014 last year.

September 2015 Selling Price per Square Foot for SFH of $656 was down -0.2% from $657 last month and up 11.4% from $589 in September of 2014.

September 2015 Selling Price vs List Price for SFH was 103.7% was down from 104.7% last month and up from 103.5% in September of last year. For example, if a home is selling for $100,000 they sold it at 103.7% higher or at $103,700 in September 2015 but would have received $104,700 in August 2015. So the overbidding on homes has calmed down a bit.

Sales Are Starting To Slow Down in May 2015

June 18, 2015 By dpizano

Market data on Single Family Homes in Santa Clara County

Closed-Sales-SantaClaraCountyCA-May-2015 — Closed Sales Santa Clara County CA May 2015

Home Sales in Santa Clara County

Data from MLS Listings show the number of single family homes sold from April 2015 to May 2015 went down 6% in Santa Clara County. This is significant, especially during a time in when the spring is here and buyers are out in full force. Or are they? Home sales are slowing down in Santa Clara County this year.

Single-Family-Homes-May-2015-vs-April-2015

This slowdown may be a knee jerk reaction of buyers pulling back a bit due to any number of factors including interest rate fluctuations, high home prices, the economy, and lack of inventory. Either way, it’s a pull back and the sellers should take notice. The market will shift at some point. It’s important that we notice when there is a slow down in sales from month to month especially when inventory has gone up 32% from last year and 3% from April 2015 to May 2015. Perhaps the price increases have bumped some would-be buyers out of the market.

Sooner or later the price increases will be more than the average buyers can afford. Prices have gone up quite a bit from last year. In fact, the median price in Santa Clara County for Single Family Home went up 12% from May 2014 to May 2015. Affordability is becoming a very important factor in Santa Clara County.

Single-Family-Homes-May-2015-vs-May-2014