The annual market report is out at popehandy.REReport.com and we can now learn how 2011 compared to 2010.  The median sales price for houses in Santa Clara County was off 5.3% overall.  But from one part of the valley to the next it varied wildly with 6 cities or areas finding themselves in positive territory while others were off by double digits.

In the image to the left, I’ve put into bold the cities where the median sales price of houses which sold and closed escrow in 2011 were ahead of 2010′s pricing.

What is it that makes Gilroy, Los Altos Hills, Los Gatos, Mountain View and Palo Alto “in the black”?

Most of these cities/towns are upscale, west valley communities.  But so are Saratoga, Cupertino, and Monte Sereno.

Gilroy was especially hard-hit with the housing downturn so perhaps in that case, it’s just coming back into more of a balance. (Then again, so was Morgan Hill and it’s still off by 12%.)

The LinkedIn IPO and others in the Palo Alto area drove prices up for some parts of the housing market nearby and it’s likely that this explains the positive growth for Palo Alto, Mountain View, and Los Altos Hills.  That said, it would seem that Los Altos, and perhaps even Sunnyvale would have seen stronger numbers on the same account.  Perhaps school scores are the key driver here.

Los Gatos, Saratoga and Monte Sereno often behave somewhat similarly as they are adjacent to one another and often attract similar home buyers who want good schools, a nice downtown area nearby and scenic beauty with the hills.  The annual numbers show Monte Sereno down 6.7%, Saratoga down 2% but Los Gatos up 6.4%.  With Monte Sereno, there are very few sales each month and each year (only about 4,000 residents), so there can be a wider swing without it necessarily being accurate. Saratoga and Los Gatos each have about 30,000 people who call these areas home, though, so the data is much more helpful.  Saratoga and Los Gatos both have multiple school districts, views, homes with better proximity to “downtown” and more variables – I think we’d have to dig a lot deeper to learn why these two neighboring markets are so diverse.  We might also have to look at multiple years of data to see if Saratoga spiked while LG slumped to explain the difference.

Coming in at last place: the Santa Cruz Mountains or Los Gatos Mountains area (zip code 95033), where the median list price of houses sold slipped 17% from the year before.  This beautifully scenic region covers a lot of territory and several quite different neighborhoods, some more convenient and others more remote.  It often takes much longer to sell a home in the mountains than on the valley floor but it can be a great “bang for your buck” for great schools, clean area, less crowding, etc.  The remoteness of some homes, the increased rain and other challenges generally make this part of the valley a more challenging real estate market most of the time, and in a down market that’s even more true.

Palo Alto, Mountain View and Los Altos each have regions which can be tracked in addition to the cities as a whole. If you’d like to see these numbers, please visit http://popehandy.rereport.com and then click on Yearly, then select the city, then the neighborhood and you can see how Baron Park or other areas are faring in particular (also for their monthly or quartly reports).

Areas within San Jose, like PA, MV and LA, can be tracked. Since I am very active in several of them (Almaden Valley, Cambrian Park, Willow Glen, Blossom Valley and others on the west side), I want to share those next.

The median sales price of houses which sold & closed in 2011 in the City of San Jose was down 5.9%, lower than the county as a whole.  Most of San Jose was worse off than the prior year – all except Alviso!

Alviso, which was a separate town until not so long ago, sold with a double digit increase in the median sales price – a whopping 10.6% higher than in 2010.  Affordability and investor activity are most likely the cause – more demand and less inventory than the year before. (I suspect either fewer distressed properties or that they were gobbled up quickly. Knowing would require more research.)

Downtown or central San Jose took a beating with the median sales price down 9.6%.  Why did it fall from grace?  Not everything in this area is affordable – consider that it includes Naglee Park, The Rosegarden, and a few other tony areas. I suspect it’s the number of foreclosures (REOs) and short sales but I don’t have that information at hand.  It would require a much closer look that our brief survey here to uncover what’s happening.  (We know that there are many unsold, new condos in downtown San Jose but those should not be impacting the sales of single family homes.)

In future articles or posts I hope to look at a few of these areas more carefully to see what is causing the great diversity between the areas showing improvement over 2010 such as Alviso, Palo Alto, Gilroy, Los Altos Hills, Los Gatos and Mountain View versus those which are really hurting: downtown San Jose, the Los Gatos Mountains, Evergreen, Morgan Hill, Milpitas.  Very likely it’s a combination of the distressed market activity in some areas, school scores, the pricing tier (i.e., homes between 1 and 2 million near Palo Alto) and more factors.  With real estate, it’s always local – and that’s just the starting point.

Ever wonder which school a property is assigned to for the students that live here?  The boundaries, especially in larger districts such as San Jose Unified, can be hard to figure out.   In the Almaden Valley area of San Jose, for instance, some parents really want to make sure that their kids attend Leland High School rather than Pioneer (or Leigh or Branham or Los Gatos High – there are so many schools represented in Almaden!), for instance.

Until recently, you had to go to the Santa Clara County Office of Education’s website to see which high school and elementary/middle school district you would be in.  I will post many of those below. From there you had to enter your address to see the specific schools. After that, you had to go to another site entirely to get the API scores.

Now, however, some smart people have done a mashup of addresses, school scores and API scores.  I like this site so well that I’m advertising in a couple of zip codes (that’s my disclaimer).  Check it out:

www.SchoolAndHousing.com

Or you can do it the slower way – visit the school district sites below!

There’s a “school finder” link that you will find very helpful:

San Jose Unified:  http://www.schvision.com/schoolfinder2/SJUSD/

Cupertino Union School District:

www.cupertino.k12.ca.us

Fremont Union High School District (Cupertino and nearby): http:/)/www.schvision.com/schoolfinder2/FUHSD/default.asp

East Side Union High School District: http://www.schvision.com/schoolfinder2/ESUHSD/default.asp

Campbell Union School District: http://www.schvision.com/schoolfinder/CampbellUSD/
Campbell High School boundary map:

http://www.cuhsd.org/downloads/boundary_map.pdf

Berryessa Union School District: http://www.schvision.com/schoolfinder2/BerryessaUnionSD/default.asp?1569Nav=%7C&NodeID=1117

Moreland School District boundaries map:

http://www.moreland.k12.ca.us/p_boundaries.html

To find more, see the Santa Clara County Office of Education’s website:
http://www.sccoe.org/

Often on this blog we look at specific, hyper local real estate markets in Santa Clara County (as with Saratoga, Campbell, Los Gatos, or even a larger city such as San Jose – or parts of it such as Almaden or Cambrian – or even subsets of any of those). Today, though, we’ll check in on Santa Clara County as a whole, which is home to 1.8 million people and many diverse markets.

The number of homes being sold in Silicon Valley is trending upward now. Prices, though, while higher than a month ago are down about 5.4% from a year before. Let’s see it visually:

Pricing of houses sold in Santa Clara County

Both median and average sales prices are shown in the graph below (which is from the printable version of my Santa Clara County Real Estate Report; you can also view an online version at popehandy.rereport.com). Note the trends with several “peaks and valleys” over the last five years or so.

To check on particular areas within the county, please visit my RE Report and select the city, town, or area within San Jose that you want to better understand.

What’s Are The Fun Places for Kids In and Near San Jose?

There are oodles of fun things for kids and the young-at-heart to do in San Jose and the greater Silicon Valley area. Here are a few of the more dramatic highlights!

California’s Great America in Santa Clara. Suitable for all ages but teens will like this best! This park does offer some water play areas and some little kid areas (but it’s expensive for that). Shows in air conditioned theaters will be welcome on warm days. Check out the Wow Card (or VIP Pass if you want to park close) if you’ll be back again in the same season.
Information on season passes & free return trips to Great America

List of Attractions Throughout Santa Clara County and Beyond

Gilroy (south of San Jose)

Gilroy Gardens (formerly Bonfante Gardens) Want to make a bigger trip of it to The Garlic Capital of the World? Gilroy offers great shopping to dress up those kids (or yourself)! Outlet Mall – List of Shops. And maybe when that’s all done, do some wine tasting. If you can take a tour, the kids may not even get bored. List of wineries (and breweries) in and near Gilroy. And lastly, don’t forget the Garlic Festival! It happens in late July every year. Yes, it’s hot. Yes, they do really serve Garlic Ice Cream. You need to try it at least once! The Gilroy Garlic Festival – information, recipes, calendar, fun stuff for kids.

Over “The Hill” – Mountains, Santa Cruz & Monterey Areas

The Mystery Spot (in the Santa Cruz Mountains)

Santa Cruz Beach Boardwalk Summertime: free concerts on Friday evenings!

A fun way to trek to the beach & boardwalk is to park and ride – on a narrow guage train ride through the beautiful redwood forest! Or just take a train ride through the trees. It’s a trip back in time to our logging days in the 1880′s and I highly recommend it. Roaring Camp & Big Trees

Well worth the 90 minute drive from San Jose to Pacific Grove: The Monterey Bay Aquarium

On The San Francisco Peninsula

Kids love airplanes, and they’ll love the Hiller Airplane Museum in San Carlos. The Hiller Aviation Museum

North Bay

Six Flaggs Discovery Kingdom Theme Park.

If you are shopping to buy a home in Silicon Valley, you will be given a report, once in contract, regarding any endangered species‘ habitats on or near the property. How does this impact your use of the land, should you complete the purchase?

If the area in which you want to buy a home is the habitat or home to an endangered species such as the red legged frog in Santa Clara County, you will not be allowed to use certain pesticides as they are harmful to that species. With some species, you may be required to landscape using only native plants to support the at risk species.  I have seen this along certain creeks, where a set number of feet from the waterfront can only be planted with indigenous flowers, bushes or plants. So if you want a lawn, it’s not happening!

The Bay Checkerspot Butterfly has several areas in Santa Clara County which are impacted, including Communications Hill, areas near Coyote Valley and San Martin, the Silver Creek area of Evergreen and many other areas along the east foothills and south county.

You might be surprised at how many at risk or endangered species there are in Silicon Valley: Golden Eageles. Tri-Colored Blackbirds, Western Pond Turtle, San Joaquin Kit Fox, Steelhead Trout, and many more animals, fish, birds and plants (see the “further reading” below for complete list).

Be sure to read the Natural Hazard Report, Environmental Hazard Report and Tax Report you get in escrow very carefully.  If the property you want to buy in the San Jose area or in San Mateo County is in an area for endangered species or one at risk, learn what you can about the requirements for homeowners in that region.  The restrictions could be minimal or significant.  Either way, you’ll want to know before you decide to complete the purchase and remove your contingencies!

For more reading:

Santa Clara Valley Habitat Plan

Do pools enhance property value in Silicon Valley back yards?  Do they make homes easier or more difficult to sell in Santa Clara County? What’s the impact on resale value?  The common wisdom is that it depends on the amount of yard or lot size, the price point and the location of the residence. When a pool takes up the majority (or virtually all) of the back yard, most often it makes the property undesirable to buyers – at least to most home buyers – and that, in turn, causes the sales price to slip a bit. It used to be that pools were almost a given on more expensive residential real estate, particularly if there is a lot of land.  Today I ran the numbers, though, and it appears that things have changed.  Below please find the “months of inventory” for homes with and without pools and note that it is very consistent, in the fields I checked, that it’s now harder to sell a home with a pool than without

.

Pools appear to make it harder to sell a home in Santa Clara County right now.

Truthfully, this came as a bit of a surprise to me since many of the luxury properties in Almaden, Los Gatos, Saratoga, Monte Sereno and nearby areas do include pools, especially if they’re on a half acre lot or more.  In the past, I remember high-end buyers not wanting to purchase a larger, estate home if there wasn’t already a pool in place since it’s such a mess (and noisy, and expensive) to go through the construction of one. Lately, though, my high-end buyers (properties upwards of a million dollars) are fairly adamant that they do not want a swimming pool. Many of them don’t want the upkeep costs or chores and have told me that they would not use it enough to make it worthwhile.

What about luxury home buyers and pools in Silicon Valley?

I wanted to see if it changed when the data was viewed in light of pricing and not just acreage or lot size, so to finish up this study, I looked at regular sales of houses listed at over $2,000,000 in Santa Clara County (the San Jose area) – these are considered luxury homes here.  For houses without pools, the months of inventory was 5.4 (not terrible, still less than the 6 months which NAR calls a balanced market) but for homes with pools, it was up to 6.8 months of inventory. That’s a significant difference and is in line with what we saw when the question was put with the amount of land involved.  Generally speaking, buyers would prefer to not have a pool, even in the higher priced subsets of the market.  (My advice: run the numbers for your own home’s micro market and see. It’s possible that this may not apply in your case.)

This still didn’t sit quite right with me since I’ve known the most expensive homes to all have pools, so I spent some time looking at homes in Los Gatos, Monte Sereno and Saratoga. I was interested to know if homes with pools were still harder to sell and had a lower resale value, as appears to be the case in more normally price houses.

First I looked again at larger lots – half an acre to about an acre and a half – in all three areas combined.  It was inconclusive but basically there were 102 of them for sale now and 12 which have closed in the last month (so 8.5 months of inventory).  Of those on the market, 56 had pools and 46 didn’t. This was too broad given the variety of zip codes and school districts, so I narrowed it to just Saratoga with only Saratoga schools.  For those in this area, just 3 have sold and closed in the last month with no pool (averaging about $1,850,000) but 9 have closed with a swimming pool (averageing about $2,735,000).  The average square footage of a house without a pool was 3482, but the average house size of places with a pool was 4309. It does appear that homes with pools do sell for more, but also that in general, these are larger homes.  Since 3/4 of those sold in this segment of the Saratoga market do have pools, it would be hard to say that buyers are rejecting homes with pools.  Of course, a 4300 SF house in Saratoga with Saratoga Schools is much different than a house in Willow Glen with San Jose schools – just underlines the fact that the real estate market is comprised of many micro markets.  What is true for the county as a whole may not be the case for luxury properties in Los Altos, Saratoga, or Almaden Valley.

Why do pools hurt the odds of selling for most houses in the San Jose area?

Bigger studies would need to be done to thoroughly address the question of why swimming pools appear to hurt saleability for most residential real estate (the very high end excluded).  But I will venture a couple of guesses.  First, there are weather issues.  Last summer was cool and this winter doesn’t seem to want to end. Pools are probably a lot more appealing when there’s significant doses of hot weather.  Second, we are still recovering from a very tough recession, so the new frugality which is currently fashionable and which has become a way of life for so many of us may be impacting the perceived value of in ground pools, too.  This may change as we move more into the recovery and when our unemployment isn’t just over 10%.

Selling a home with a swimming pool

Home owners, it’s important to realize that although you may have enjoyed and treasured your pool, for buyers it may be viewed as a liability – an expense to have it removed or to maintained. To get the best deal for your home, you’ll want to try to mitigate the buyer’s concerns since worried buyers will pay less and confident buyers will pay more for your property. Solar panels make it less expensive to maintain, and therefore more acceptable to consumers worried about power bills.  Families with small children may be concerned about safety issues, so having a great child-proof fencing system may provide them peace of mind.  You could, as a negotiation strategy or selling bonus, throw in one year of pool service from your favorite provider too, since they may feel ill-equipped to take on the maintenance of a pool as soon as they move in.  A home warranty with pool coverage will also provide peace of mind and a sense of a safety net should things go wrong.

Selling a house with a pool? Make sure it's clean!

Pools, like every other element of the house and yard, need to be in pristine, sparkling condition if you want to maximize the sales price of your property.   When home buyers, especially first time home buyers, see missing tiles, obvious rust stains, rampant algae, leaking pool equipment or other problems, they see both work to be done and dollar signs.  This is even more true if there are no pre-sale inspections.  Don’t provide reasons for your home’s buyer to be worried – buying a home at all is worrisome enough!

Should you remove the pool before putting your house on the market?

Filled pool: what not to do

Some home sellers may opt to get rid of the pool before selling. That can be a good idea, especially if the back yard is really small, but it needs to be done correctly. Recently I was house-hunting with some clients in the Almaden Valley area of San Jose and we saw a backyard where the pool was left completely in place, but filled with dirt and planted with grass. I assure you, that was a terrible idea because now buyers see it as twice as much trouble (and cost) to rectify. Home buyers, if you are neutral on buying with or without a pool, you may find it far easier to purchase property that has a pool as it seems that there will be less competition for it. If you want a pool, you are in luck right now!  Market conditions change and three or four years from now, when we are in a more recovered economic status, pools may again be the hot ticket.  This is a great opportunity to buy a house with a pool while there’s less competition! Want to talk about buying or selling a home with a pool?  Call or email me today!

The Silicon Valley real esate market is heating up but it’s not heating “evenly”.  Some price points and areas (or school districts) enjoy a hot seller’s market while other segments are lagging.  A big factor in the overall health of the realty market in the San Jose area is the percentage of listings which are distressed properties, meaning short sales and bank owned homes.  Today we’ll see the ratios of these homes to the regular sales using graphs to get a quick visual take on the market trends and statistics.

Today we’ll look at homes listed on the MLS in all of Santa Clara County (including San Jose, Campbell, Los Gatos, Saratoga etc.) by price point. All of the graphs in this post will reference houses and duet homes combinesd(about 99% houses), not condos or townhomes.

Overall, it looks like about 1/3 of all homes for sale in the county are distressed sales. Next let’s look at this data by price point and then we’ll check it by area.  The images below will be smaller but the colors will represent the same elements in each one (green being regular sales, brick being short sales and light orange being REOs).

Ratio of regular sales to short sales and bank owned homes in Silicon Valley by price point

1. $599,999 and under

This first graph by pricing reflects houses (and duet homes) for sale in Santa Clara County which are under $600,000.

For this group, less than 50% (the green segment) is “regular sales”.  Most of the housing market in this entry-level pricing is distressed properties for sale.

Notice, too, that there are far more short sales than REOs or bank owned homes.

2. $600,000 to $999,999

The next group is homes priced between $600,000 and $999,000 – so these are primarily “move up” home prices, though in some parts of Siicon Valley (such as Palo Alto, Saratoga, Los Altos and a few others), these homes would be a first house, most likely.

3. $1 million to $2 million dollars

The third grouping consists of Santa Clara County houses for sale which are listed between $1,000,000 and $2,000,000.

These are nicer homes but usually not luxury housing per se in most parts of the county. In the more affordable areas such as Morgan Hill, Gilroy, and east San Jose areas, though, these could also constitute estate or luxury homes. (Not in Los Gatos, Monte Sereno or some west valley areas).

It is interesting to see that in this upper price point there are very few distressed sales – almost all of them are “regular sales”.

4. Homes priced at more than $2,000,000 – the Luxury Homes

Luxury homes in Santa Clara County vary but most are in the single million digit prices and very few selling more than $10 or $20 million  (though you may have heard about the recent, history-making $100,000 million sale in Los Altos Hills).

Tomorrow check back to see how these types of numbers shake out by city, town or district – we will view a sampling of them.

Sometimes public property records are wrong or have missing information.  How do you go about correcting these kinds of issues?

In Santa Clara County (San Jose, Los Gatos, Saratoga, Campbell etc.), you must go through the county tax assessor’s office to address these errors. Here’s what you need to do:

1. First, find your APN or assessor’s parcel number and keep it handy, as you will need it (also paper & pen).  You will find it on your property tax bill.  You can also find your APN online via the Santa Clara County website.
2. Phone the Real Property & Appraiser Department (408) 299-5300.  Someone there will ask you for your APN so that the correct appraiser can be contacted – I was surprised to learn that there are several dozen appraisers on staff!
3. From there, you’ll need to talk with your assigned appraiser and see what needs to be done.  He or she may need some documentation, may ask you some questions – just call and find out.

Why are the public records on real property sometimes wrong?

Lots of things can cause the problem with incorrect public property records.  Here are a few potential reasons why the records could be incomplete, inaccurate, or missing altogether.

• Original data entry error (a typo) – when everything is correct except one item, such as the number of bedrooms, it could well be that the wrong number was submitted on a form or a mistaken key hit at entry.  (I think this happened to my own house, where we have 4 bedrooms but the records said 3.)
• Addition or expansion to the house – sometimes these are not done with permits & finals (and won’t show up on the county records for that reason). Other times, the work was permitted and finaled, but the paperwork lost at the county or city level.  This is not so uncommon (and the cause of not a few upsets).  It is imperative that home owners keep all of this paperwork themselves and not rely on any other office to keep perfectly accurate records.
• Lack of concern about some details, such as the actual lot size.  While an entire tract may have 6000 square foot lots listed on the public records, it’s possible (probable) that the parcels aren’t really all the exact same size.  Homes built on “pie shaped” lots or on the inside of cul-de-sacs may well have much larger areas but for whatever reason, the entire subdivision reads as if they all have the same lot.  I have a couple of times sold homes with lots said to be 6000 SF when in fact they were closer to 11,000.  In selling, that can help you to get more money for your home!  In buying, if you purchase a property with a larger lot but is sold with numbers reflecting the smaller one, it could be money in the bank.

Some folks will tell you not to worry about correcting the public records (and in some cases, it’s not easy to do).  But real estate consumers are savvy and have access to the official data on your lot and house quite easily now.  If you say your home is a certain size or has particular features but the public records don’t reflect it, that puts a question in the potential buyer’s mind: what’s wrong? Why don’t these line up?  Best to do what you can to get the reality of your property in line with the public records so it won’t be either a problem or a rush to fix it later.

How’s the inventory?  This is key to both home buyers and sellers in Santa Clara County. Too little inventory of homes for sale pushes prices up, too much housing inventory pushes them down.  Today we’ll have a look at the county level for the general Silicon Valley trends.  Please understand that smaller areas (zip codes or even subdivisions) can be vastly different from the larger trends.

Our MLS no longer provides much historical data – it only goes back a couple or three years.  My I have a subscription to the Real Estate Report, which stretches back a decade.  The most current report covers January 2011 (February’s numbers will be there by the 10th of March) so I pulled these numbers plus those of the same month for prior years.

So what is really a “normal” level of inventory for Santa Clara County houses & duet homes on the market?  I would say that anything in the 2000 to 3000 range is fairly normal.  More than that is overheated, less than that is constricted.  (In the early 90s it was many thousands of homes – if I recall correctly, it was over 8,000.)

Right now is not an extreme market in terms of the availability of homes to purchase in the South Bay.  It feels tough because lending standards are stricter, as are appraisals, and because we are all jittery from the market crash and touch-and-go recovery. Sellers feel beat up over pricing and the new “requirement” that homes need to be about perfect to sell (or have the price slashed to an extreme, as they see it).

But the numbers are really not so bad, when you view them statistically.  The inventory is a little low, but still within fairly normal ranges, historically.

The Williamson Act, also known as the California Land Conservation Act, was passed by our California Legislature in 1965 in order to encourage rural & agricultural lands to remain undeveloped longer. When land owners enter into a contract under the act, they benefit from lower property taxes, which are based on the property’s current use, rather than paying market value based tax rates.  In exchange, the property is to remain undeveloped and continue to function the same way for the duration of that contract.  The contracts run for 10 years and are automatically renewed unless the farmer or rancher cancels it.

Why does the Williamson Act matter?

According to the Committee for Green Foothills, there are 362,000 acres of land in Santa Clara County under the Williamson Act (that article appears to have been written in 2003, so the numbers may have changed a little since then).  Much of it is in the east foothills of east San Jose and the south county areas near Morgan Hill and Gilroy, but there are patches of it in Los Gatos, Saratoga, Cupertino, Almaden Valley, Blossom Valley and throughout Silicon Valley. The tax breaks make it possible for many farmers and ranchers to stay in business and not feel forced to sell their land for development.  If they were paying “market rate” taxes, it would not be long before most or all of our rural and agricultural uses gave way to housing and other development.

Since urban sprawl created way too many neighborhoods without parks and too much automobile dependence in the last century, we have come to realize how tremendously important it is to preserve our open space and to plan wisely for the future.  While it’s unlikely that 100 years from now we will have as much acreage devoted to horses, cows, sheep and goats – let alone fruit trees, vineyard and other agriculture – we’d like to not see these local industries snuffed out due to economic hardship.  Can you imagine Gilroy without garlic farms?  Without a little help, the rural parts of California will disappear just as the beautiful orchards which gave this valley the nickname of “the valley of heart’s delight” have evaporated from view.

So for quality of life, for preservation of history, and for many other reasons, it behooves all of us to help protect our open spaces.

Challenges with The Williamson Act

here have been some challenges and problems in recent years for the Williamson Act.

In some cases, landowners went ahead and developed property that was supposed to remain ranch land, orchards, farmland etc. (At one time, property owners could pay a fee – or a fine – and get their property out of the contract. Not today, at least not so easily. In some very rare cases, land owners can cancel the contract and pay a fee – you can read about cancellations here.)

Another big issue is paying for it.  Naturally, anything which saves property owners money is costing the government in the process.  While many Californians deeply appreciate the effort to conserve our rural and agricultural land, apparently the fiscal problems at every government level in the state is putting the Williamson Act at risk as the state hasn’t always been able to reimburse the counties or cities (that financial support or reimbursement is called “subvention payments”)  for the money lost due to the land being in the Williamson Act (or perhaps just not in a timely manner?).  Some counties may want to drop out of the program, according to the Western Farm Press.

A “realignment plan” was proposed by the state in which the contracts would be reduced from 10 years to 9 and the tax rate benefits would be cut by 10%.  The participating counties got to vote on this.  In Santa Clara County, our supervisors voted NO in December.  The contracts will continue to run as before, even without as much state help. (Santa Clara County is not as dependent upon this money as some more rural counties are.)

The latest: Governor Jerry Brown recently proposed eliminating funding for the Williamson Act.

What will happen if the state stops funding this program altogether?  Ranchers and farmers would see a rise in taxes that might make their businesses in Santa Clara County untenable, for starters. There would be lost jobs and the economy of the south county, especially, would be further damaged. Some rural Santa Clara County property owners likely will feel forced to sell their land for development.

Some other alternatives to development

Some lands may be transferred out of the Williamson Act and into something a little similar, an Open Space Easement (see Open Space Easement Act of 1974).   This essentially gives the local government the right to ensure that the land is mostly undeveloped, and again there are tax breaks for the owners of the land, again for ten years at a stretch.

The Peninsula Open Space Trust sometimes buys up large swatches of land too, with the intention of making the land “open” not just for a ten year contract, but forever. This is a great cause and my disclaimer here is that it’s one my husband and I support.

I believe that when POST takes over land, it wants to eliminate buildings on the site – sometimes, these structures are historic in nature, though, so I cannot say that this is a 100% good solution since preserving historic homes and other buildings is also extremely worthwhile.

For more information on the Williamson Act and Open Space Easements:

You can read about the Williamson Act on the state’s website – tremendous detail!

Santa Clara County government info on the Williamson Act here.

Brochure regarding Open Space Easements from the Santa Clara County Planning Office

The schedule for when property taxes are due in Santa Clara County is not intuitive and confuses most people, at least initially.  The tax calendar is as follows:

• Beginning of fiscal year: July 1st
• First installment of taxes due covers July 1 – December 31st
• Second installment of taxes due covers Jan 1 – June 30

Although you might expect the two bills to be due & payable 6 months apart, that’s not how it works!

Installment # 1 is due November 1 and is delinquent December 10th

Installment # 2 is due February 1 and is delinquent April 10th

Please note that the April deadline is very, very close to that for personal income taxes (April 15) and many homeowners accidentally send in their property taxes on the latter day.  This results in a costly penalty, so don’t be confused!!    (Also, do not count on mailing your payments by 11:59pm on the deadlines either – the tax assessor’s office does not work like the IRS! Payments are due by 5pm that day!)  Make sure you don’t cut it too close or you’ll find yourself paying 10% plus $20 more than necessary.

It is possible to pay your property taxes online, but the cost is significantly more than a postage stamp, so I don’t recommend it unless you are out of the area and cannot make your payment the normal way. (It’s 2.5% via credit card and $15 per electronic check.)

How are the sales of condos and townhouses in the San Jose, Santa Clara County or Silicon Valley area? Just as with houses, the market is getting more active… things are picking up.  The trend is for increasing sales – pending condo sales in Santa Clara County are rising each week.

Nov 1 – Nov 7 = 116 newly sold (sale pending) condominiums and townhouses
Nov 8 – Nov 14 = 123
Nov 15 – Nov 21 = 129

Year over year, it’s up dramatically too.  Nov 1 – 22 2009 = 234 newly pending sales and Nov 1 – 22, 2010 = 366 newly pending sales (that’s a 64% increase).  That is a very huge increase!

Looking at closed sales and comparing it to two or three weeks ago, we see improvement.  Here’s a graph showing the months of inventory for condominiums and townhouses in Santa Clara County, San Jose, Sunnyvale and Los Gatos (as samples). Below please find the months of inventory for all sale types (REOs, short sales and regular sales) and just short sales.  Countywide and in most places, it remains much harder to sell a “short sale listing” than a regular one.

Los Gatos is odd in that the short sales are going faster than the regular sales.  As you can see, that’s not the norm for the county!  My best guess is that the good schools and low prices make short sales in Los Gatos very attractive.  We might find this same trend in other areas with exceptional schools such as Almaden, Saratoga, Cupertino and Los Altos.

Sunnyvale is still struggling but it has improved from the last time I checked the numbers on Nov 13 2010.

Last month we heard that residential real estate sales were off about 25% nationwide year over year (closed sales) and it was just as bad for home sales in San Jose (statistics show that sales were off 34.8% for closed sales of houses but up 5% for pending sales) and in Silicon Valley generally (closed house sales in Santa Clara County down 28.5% and pending sales up 5.3%).  Pending sales were up around 10% month over month.

Houses in Silicon Valley are Selling Faster and Faster

Pending house sales are on the rise and it’s  now dramatic.  At first I thought it was just me: in the last 30 days, I’ve put five sales together of houses and townhouses (one in Livermore, one in Foster City, one in Campbell and two in San Jose – both in the Almaden Winery neighborhood on the Cambrian/Almaden border).   But it’s not just this faithful blogger who’s seeing a surge in selling activity and accepted offers.  These are clearly trends in the local south bay market.

I just spent a little time on MLSListings.com and checked the numbers of newly pending sales in the city of San Jose:

• Nov 1 to Nov 7, 2010:  159 new pending sales in San Jose
• Nov 8 to Nov 14, 2010: 163 new pending sales in San Jose
• Nov 15 to Nov 21, 2010: 198 new under contract or pending sales in San Jose

If I check sales from 11-1-2010 through 11-22-2010 there were 566 this year but just 386 for the same period last year in San Jose.

Ditto that for all of Santa Clara County: from Nov 1 – 22, 2009 there were 666 pending sales but Nov 1 – 22, 2010 it was 954! 

What’s the cause of all this? Most likely it’s the incredibly low interest rates, which are scraping the bottom and are at about 60 year lows.  My mortgage broker and mortgage banker friends are insanely busy with sales and refinances.

And what does this mean for you, a home buyer or seller in Silicon Valley?  A couple of things:

Silicon Valley Home Sellers: often people pull their homes off the market between Thanksgiving and the New Year or wait until after the holidays to put their home on the market.  This year, perhaps you want to rethink that strategy.  Homes that have been “just sitting” on the market are in some cases now seeing multiple offers.  I have seen this in my own practice.

Silicon Valley Home Buyers: you may not be able to get away with “low balling” homes even if they’ve been on the market awhile because many other buyers who have been watching the market are now jumping in with both feet.  Study the comps and write a realistic offer if you want the home!

People often ask me, “how’s the market?”  The answer is, it depends.  It depends on whether it’s a short sale, REO or regular sale, the schools, view, condition, etc. The Silicon Valley real estate market really isn’t “one market“. It’s a bunch of smaller markets woven together. So the answer depends on what you’re looking at.

Today we’ll focus on the sale type and take a broad view of regular sales vs short sales with Silicon Valley houses/duet homes and condos/townhouses.  The data comes from MLSListings.com, our local multiple listing service, of which I am a member.  I crunched the numbers today. I have made every effort to provide accurate info, but can’t guarantee it.

To arrive at the months of inventory, I get the number of active listings (not pending, but available, or “status 1″ for my local Realtor readers) and the number of closed listings for the same area/home type which have closed in the last month.  Divide the first number by the second and you get months of inventory or MOI.  Below please find the numbers for Santa Clara County as a whole, San Jose as a whole, and various cities or areas of San Jose.

The National Association of Realtors calls 6 months a balanced market. In our area, at 5 months it is really a buyers market, though. The higher the MOI, the “worse” the market is for sellers – things just aren’t selling well. Over a year and it feels impossible.

Generally speaking, it’s a sellers market for most Silicon Valley real estate – the non-distressed homes on the market are selling very decently overall (Los Gatos seems to be the exception).  Also generally speaking, it’s harder to sell a condo or townhouse than it is a single family home (house or duet home).  It’s worse still if it’s a short sale townhome or condominium.  Sunnyvale is the toughest market around for short sale townhouses or condominiums – it is at a whopping 16 months of inventory.  There are a ton of short sales and buyers are simply not buying them.

At the other end of the spectrum is Cupertino, where non distressed homes are a red hot sellers market at just about 1.5 months of inventory.

Broad generalization – Best market:  non-distressed houses.  Worst market: short sale condos & townhouses.  There are some exceptions. It’s not all that easy to sell a house in Los Gatos, and short sales in Cupertino and selling well.  So many nuances even in the broader markets.

How’s the market? It depends!  A Sunnyvale condo short sale seller is in a totally different market than the seller of a non-distressed house in Sunnyvale.  Same city, completely different market.

Silicon Valley home owners who are thinking of putting their properties on the market are wondering a few things:

• how much is my home worth?
• how long will it take to sell my home?
• how long will it take to close escrow?

Today we’ll discuss how long it takes to sell a home in the San Jose – Silicon Valley areas.

Of homes that have sold and closed in Santa Clara County, the speed of sale and the pending sale time frame depend a lot on the sale type. 

• For short sales, San Jose area homes are typically on the market for about 123 days, then once they are sale pending, it’s approximately 100 days until close of escrow.  Start to finish, it’s about 8 months long! 
• For bank owned properties in Santa Clara County, days on market are often around 75 and the length of escrow 38 days.
• With regular sales, the DOM is a quick 51 and length of escrow averages 39 days.  
• For all sales, the Days on Market was 113.

Let’s look at a particular area within San Jose to see how the numbers might vary.  We’ll take the Cambrian Park district of San Jose for our example (zip codes 95124 and 95118 primarily).  In Cambrian Park, right now there are 184 houses on the market and they average 94 days on the market.  In the same area there 95 pending sales and they average 76 days on the market. In the last month, there were 46 houses that sold & closed and their days on market averaged 52 overall.  Not every home, though, sold so fast or so slowly!

Days on market of Cambrian closed sales in last 30 days:
All combined average DOM = 52
Short sale DOM = 121
Bank Owned DOM = 128
Regular sale DOM = 40

These numbers could be further teased out by price point and school district – but you get the idea.  Some homes will be difficult to sell and some much easier! Even among the “regular sales”, certain homes will tend to sell faster: newer homes, homes on larger lots, houses which are professionally staged, properties which are priced aggressively (rather than “testing the market”).  In many cases, well priced homes that are in good condition and with no “issues” will sell within a month.

Complicate the situation with showing challenges (appt only, no lock box, tenants in the home etc.), a rough condition, difficult sale type or other problems (such as being too close to high voltage power lines, a busy road etc.) and those homes could take much, much longer to sell.

For information on your particular situation and to get a more precise sense on the timing, please contact me today!