How’s the real estate market in San Jose’s Almaden Valley? Commentary and statistics…..

It’s actuallya lot hotter than the numbers for the Almaden closed sales in February might indicate; the last 2-3 weeks have seen a heat-up the likes of which I have not seen since 2000. Many properties are selling fast, sometimes with multiple offers.  We are experiencing this trend throughout the west valley areas: Los Gatos, Saratoga, Cupertino, Palo Alto and on up the Peninsula.  These multiple offers are pushing prices higher. In many cases, it is much higher.  I’m seeing some overbids of more than $100,000 in some cases as well as offers with no contingencies for loan or home inspection. Listing agents sometimes write in their private MLS comments for other agents “no pre-emptive offers“.

What’s driving it?  There are years of pent up demand in which would-be home buyers sat on the fence, either because they expected further price drops or because, in the case of move-up buyers, they didn’t have enough equity to budge.  With record low interest rates and prices creeping up – combined with an infusion of cash from high tech employees with either great stock prices (Apple) or an IPO (LinkedIn, Facebook, Yelp, and more), there’s the classic case of more demand than supply. 

Almost every offer I’ve been involved with over the last month has been a multiple offer situation, whether in south San Jose, Blossom Valley, Cambrian, Los Gatos, or Saratoga.  Prices from $400,000 to $1,800,000 – all at least 5 offers, sometimes far more.  As Chris Trappani, the CEO and founder of Sereno Group says, “we’re seeing it now – the papers will report on it in a month”.

Stats for the Almaden real estate market for houses in February 2012 (click on link to see more info):

Note that the median sales price is up almost 15% from January and the average price rose 7% month over month. Year over year it’s not so good but from what we are seeing, it’s unlikely to look like this when the March 2012 numbers roll in.  Also note the jump in pending sales and the lower number of actives – less inventory, more absorption.

How is the real estate market doing in the Almaden Valley area of San Jose? We can look at a few key indicators (median list price, average days on market, and inventory levels) to get a pulse on the current market in the San Jose, 95120, area. Graphs below are from Altos Research; I am a subscriber so may present these to you here. Data used is list pricing. (To see the most recent reports using closed Almaden sales numbers from November, please view my Almaden Valley Real Estate Report, which is from another provider and is another of my subscriptions to get the best data possible for my clients and readers.)

From the solds last month and in prior months, we know that overall, the Almaden real estate market has been deepening in the buyer’s favor. Prices have been slipping, days on the market are lengthening, and list price to sale price ratios have wavered a bit.

Median List Price for Almaden Valley Homes

The graph above reflects the list prices of real estate in Almaden Valley, which is an upscale district on the southestern side of the city of San Jose. Interestingly, while the list prices of single family homes is declining, the list prices of condos and townhomes has performed almost the opposite in the last twelve months and now appears to be level.

Among houses, is it any different from one price point to another?
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How is the Almaden Valley Real Estate Market doing?

It’s the end of September now, and normally we see a little rally in the market after Labor Day. Let’s see how this September is stacking up in Almaden Valley. Below, please find charts using current list prices courtesy of Altos Research (to which I subscribe).

The Median List price for the Almaden Valley district of San Jose (zip code 95120) has been declining overall. Does this mean that homes are declining in value? Or does it mean that less expensive homes are being offered for sale? Information from sold data indicates that by and large, homes are holding their value in Almaden right now. The declines in asking prices may indicate that sellers simply want prices to be rising more than they actually are, rather than the idea that values are falling.

This first chart indicates how both homes and condominiums or townhouses are faring in terms of median list prices in Almaden. Interestingly, the condo market had a steeply rising list price this last spring, while the single family home market did a milder version of the same a couple of months later. What sellers want for their homes is not matching up to what they are getting.

Next, let’s have a look at the percent of homes that have had price reductions in this part of San Jose. A steep increase in the number of condos needing reductions in price are seen in the timeframe following that rise noted above. This would seem to indicate that condo sellers were more optimistic when putting their homes on the market, but found out over the next couple of months that these asking prices were not realistic. The number of properties getting price decreases among single family homes were a bit later, just like the rising list prices were later, in Almaden. Right now, though, the percentage of sellers decreasing their list prices are about the same for both types of housing – appx 52%. So approximately half the homes currently on the market in Almaden have had at least one price reduction.

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San Jose’s upscale suburb, Almaden Valley, features gorgeous hillside views, great schools, low crime, and consistently nice neighborhoods. Home prices range from a little higher than average to very expensive. How is the real estate market faring in posh Almaden Valley?

Here’s a snapshot view of list prices over the last year in Almaden of both single family houses and condos or town

It is curious to note that condo prices seemed to have an uptick while single family homes had a downtick around March first of this year. Condo and townhouse prices in Almaden appear to be slipping overall since then, while home prices have risen generally, though slipped again a little since July 1st.

Next let’s have a look at asking prices for single family homes, or houses (as opposed to condominiums or townhomes). Below, find the data broken down by quartiles.

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