Silicon Valley Real Estate

There’s a lot for those of us in Silicon Valley to be feeling stressed out about lately. Between the stock market’s wild ride and sinking home values in Santa Clara County (and around the country), it’s a little nerve-wracking. These times are especially upsetting if you’re a senior and plan to retire soon.  For years, people looked at their homes with the fond sense of “this is my retirement fund” - or at least a good part of it. Some of that value is now gone.

It’s also stressful for those of us who’ve put money into retirement funds or  college savings plans and need it soon. Here in California, the 529 College Savings Plan is an “index fund". That means it’s a combination of stocks, mutual funds, and bonds. In my house, we have one kid who’s a freshman in college and one who’s a senior in high school, and we’re seeing the 529 Plan shrink right when we need it.

The stock market, the financial crisis and the housing market are bigger than all of us. We are on the verge of a recession, if not already in one now. There’s a lot that’s beyond our control. But what CAN we do to maximize the current situation?

I cannot say what to do about the stock market, though my hunch is that when people advise “buy low", they are talking about today. I can say something about the housing market in the San Jose area, though, because I’ve got experience with it, both professionally and personally.  There are opportunities in this market for those who are able to act on them.

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The Campbell real estate market is levelling out and even improving in many regards but it does remain a buyers market there now. In this look at the real estate market in the city of Campbell, we’ll use tools and data provided by two subscription services I have, Altos Research and The Real Estate Report, and also I have crunched some numbers from our MLS myself. We will review both the situation for buyers and sellers of houses as well as condos and townhomes.

 How is the Campbell housing market? Data from Altos Research.

Altos Research analyses the Campbell real estate market as a whole using list prices (not sold prices - I will use sold prices further on in this post). To get an overview of how the market’s doing, Altos created the “median market action index". This is an overview of how Altos perceives that the real estate market is doing, factoring in prices, days on market, etc. Below is the median market action index for Campbell (the 95008 zip code). 

Altos states that “A value above 30 indicates demand is relatively robust, we call that a Seller’s Market. Below 30 is a Buyer’s Market.” So we can understand that the condo market seems to be improving now and fthe single family home market has been bouncing up and down within a small range since July or so. (Tthe chart below should report whatever is most current, thanks to my having used a little html magic.)

Inventory in Campbell had been rising, but recently is leveling off:

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Ths San Jose real estate market conditions vary wildly from one part of this sprawling city to the next. The high-end neighborhoods of Silver Creek, Almaden Valley, as well as parts of the Rosegarden and some hilly locations with views are all very different real estate markets then downtown San Jose, the Santa Teresa area, Burbank, or east San Jose. Even within each district, there are many smaller markets. Today we’ll have a look at the Cambrian Park real estate market.

How’s the real estate market in Cambrian Park?

There are some plusses for Cambrian Park, being up against some well-to-do areas (Los Gatos and Almaden Valley). The area is a middle-class to upper-middle class area and homes are generally well kept and schools range from good to great. All of these help keep values fairly strong in Cambrian.

Even so, prices are down and sales are down, just like the rest of Silicon Valley. However, it’s not as bad here as in many parts of Santa Clara County.

Houses in Cambrian Park have mostly enjoyed a good absorption rate of under 6 months for most of this year. It’s been a little rougher on the Cambrian condo market though. As with the rest of Silicon Valley condos, they just are not selling as well as houses, most likely because single family homes have come down so much in price that they are more affordable.

Overall, it is currently very close to a “balanced market” in Cambrian Park. That means it’s a reasonable time for both buyers and sellers right now.

Next let’s have a look at the data, statistics and trends for the housing market in Cambrian Park. How are realty values holding up?

Cambrian Park Houses - trends, data and statistics

Prices are down in the Cambrian district about 18% year over year. This is bad, but for all of the city of San Jose, that number is a bit over 32%!  It’s easily a $100,000 savings for buyers getting into the market now and is making Cambrian Park homes far more affordable then in recent history.  Interestingly, the days on market are better than a month ago and inventory is better than both last month and last year. Are we near the bottom? That could be the case.

Now let’s have a look at the same information for the Cambrian condo and townhouse market.

Cambrian Park Condominiums and Townhomes - trends, data and statistics

Condo prices are down, but sales are up, in Cambrian Park. Days on market are a hair better than last month but still significantly worse than last yaer. Inventory, though, is down 14% from a year ago. So again we have a lot of mixed signals on how this market is faring, except for pricing, which is decidedly down. It seems to have farther to go before it will bottom out. Looking back at the absorption rate graph for Cambrian Park Condos, you’ll see that lately, things have improved quite a bit for condominium sellers here.

Next - buying and selling in San Jose’s Cambrian Park District - what to do, what not to do, now!

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How’s the Almaden real estate market? We’ll have a look at the absorption rates among houses and condos to start.

One disclaimer - for the month of February, there were NO closed condo or townhouse sales, so the months of inventory is not really answerable unless we wanted to put “infinite” (which doesn’t chart well). There were ten active listings at the time. So I entered 14 to rank it with the worst of the months this year.

So what do these numbers mean? They are a way of seeing how long it would take for the current inventory to sell off if no new homes came onto the market and properties continued selling and closing at the current rate. Under 6 months is considered a sellers market by the National Association of Realtors, and more than 6 is considered a buyers market.

As you can see, the absorption rate, or months of inventory, among single family homes has stayed fairly low most of this year, whereas the condo market has had a few more challenging months, but recently is improving.

Next let’s have a look at the Almaden Valley real estate statistics, data and trends, first among houses:

Prices have slipped from last year but the median price is identical to last month, interestingly. The number of sales is way down from last month, when Almaden Valley and many other parts of Silicon Valley experiences a bit of a surge in sales. Inventory is not much different from last month and up a bit from a year ago. Perhaps most notable is the ratio between list price and sales price. Days are market are very similar to last month and to last year. As in other parts of San Jose and Santa Clara County, it’s inching downward.

And next, let’s view the condo and townhome market data, stats and trends in Almaden:

The condo and townhouse market in Almaden Valley has been more erratic than the single family home market. There are not a lot of condominiums in Almaden, so the numbers are too easy to skew. Despite these challenges, we can see that prices are slipping, inventory is up, list price to sales price is slipping, days on the market area up. But the good news is that the number of sales is rising, and if this becomes a consistent trend, we’ll know that we are at or near “the bottom of the market".

If you would like information on buying or selling a home in Almaden Valley, or anywhere in Silicon Valley, please call or email me. I’m happy to offer you a free, no-obligation initial consulatation.

Mary Pope-Handy, Realtor,  CRS, ABR, e-PRO, SRES, ASP, RECS, CNHS, ACRE
Helping Nice Folks to Buy & Sell Homes Since 1993
Co-Author: “Get The Best Deal When Selling Your Home In Silicon Valley”
Keller Williams, Cupertino, CA  (Silicon Valley)
877 397-5391 (Direct/Toll-Free/Fax);   408 204-7673 (Cell)
www.DelightHomes.com     (PopeHandy.com)
emailto: Mary@PopeHandy.com

How’s the real estate market in Santa Clara, California? In a nutshell, it’s doing much better than the majority of Santa Clara County or Silicon Valley. Let’s look at the absorption rate first, which is the rate at which the current inventory would sell off if no new homes were to come on the market and properties would continue selling at the current rate. The National Association of Realtors says that 6 months or less of inventory is a sellers market whereas more than 6 months reflects a buyers lunch.

As you can see on the absorption rate chart above, the condo market has had its ups and downs, faring better than the single family market five months of the nine so far this year, but faring far, far worse on the others.

Next let’s track the data for Santa Clara’s houses, and afterwards, condos and townhomes.

Real Estate Statistics for Single Family Homes in Santa Clara, CA

 Things seem to be improving. It will be good to keep an eye on this market to see if this month was just a blip or if the market is truly on its way back up.

Real Estate Statistics for Condominiums and Townhouses in Santa Clara, CA

 Prices seem to be on their way up and inventory is up from last month but down from last year, and days on the market are down too. The Santa Clara condo market appears to be improving so this is definitely something to watch. Buyers, this may be a great time to buy a condo in Santa Clara!

Mary Pope-Handy, Realtor,  CRS, ABR, e-PRO, SRES, ASP, RECS, CNHS, ACRE
Helping Nice Folks to Buy & Sell Homes Since 1993
Co-Author: “Get The Best Deal When Selling Your Home In Silicon Valley”
Keller Williams, Cupertino, CA  (Silicon Valley)
877 397-5391 (Direct/Toll-Free/Fax);   408 204-7673 (Cell)
www.DelightHomes.com     (PopeHandy.com)
emailto: Mary@PopeHandy.com
Blog: www.LiveInLosGatos.com & www.ValleyOfHeartsDelight.com</p>

http://www.sanjoserealestatelosgatoshomes.com/004528

Normally I view real estate on a local, or even hyper-local, level. But I thought it might also be good to view the big picture and see San Jose as a whole - with nearly a million residents, it would provide quite a snapshot of how Silicon Valley real estate is doing.

Below, please find a graph reflecting the single family home and condo/townhouse market in San Jose as displayed by the absorption rate:

I find this rather remarkably positive - look at the consistent lowering of the months of inventory for both houses in San Jose as well as townhouses and condos in San Jose. It is a very strong, consistent trend city wide.

Why is it not making the papers?

That National Association of Realtors says that more than 6 months of inventory is a buyers market and less is a sellers market. So clearly, this IS a buyers market. But at this rate, will it continue to be one?

Let’s look at the data (care of the Real Estate Report, to which I subscribe). First, find the information for the single family home market in San Jose:

The number of sales is up, but prices continue to slide. Perhaps that’s why the absorption rate isn’t making the headlines.

Next, let’s check out the condominium and townhouse market in San Jose:

And again, prices are still falling - about a third, again, over last year. So it’s not yet time to break out the bubbly.

The improved months of inventory seems to be a harbinger of improvement, though. Are we near the bottom? Increased sales indicate that we just might be there.

Interested in buying or selling a home in San Jose, or elsewhere in Silicon Valley? Call or email me. I’m happy to do a free, no-obligation, initial consultation with you to discuss your wants, needs, and dreams.

Silicon Valley has wildly divergent real estate market conditions right now, and those swings are evident in the Willow Glen district of San Jose. As is the case elsewhere in Santa Clara County, the condo market has had a far rougher time of it than the single family home market.

The market for Willow Glen houses has been fairly close to a balanced market (6 months) for much of this year, though the general trend is in the buyers favor at this point and prices are down (see chart below).

The statistics, data and trends for single family homes in the Willow Glen Real Estate Market:

While the aborption rate for condos is far worse then for single family homes in Willow Glen, pricing is amazingly strong - down a very slight amount from a year ago (much less then with houses). That said, almost no condos are selling. So likely only the best of the best is selling and everything else goes unsold. So having strong prices but most homes not selling is no consolation to sellers.

This is a trend we are seeing in most of Silicon Valley, and in all types of homes. Buyers don’t want to fix up. They want turnkey.

Statistics, data and trends for condominiums and townhouses in the Willow Glen Real Estate Market of San Jose:

 If you are interested in buying or selling a home in Willow Glen, please call or email me. I’d be happy to offer you a free one hour consulation.