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.

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.

It’s possible to live in Silicon Valley and have no idea that there are still some original adobe houses to be found right here in the San Jose area. Today, though, I hope to help some of our residents discover the past which is lurking right in front of us!

The historic Adobe Woman’s Club is just a block or two off the campus of Santa Clara University, tucked away on a side street now that The Alameda is re-routed as The El Camino.  Address: 3260 The Alameda, Santa Clara.  According to the state’s historical preservation site, this state landmark # 249 is one of the oldest in the Santa Clara Valley, was built between 1792 and 1800 and was one of many row houses built for the native Americans who worked at Mission Santa Clara.  Please note that this is private property and you may not enter without permission, but the adobe abode is very visible from the sidewalk.

Today the beautifully preserved adobe house functions as a nonprofit group with these objectives: “to promote educational, moral, social welfare, cultural, civic and community service.  Anyone who supports these objectives is welcome.”  This scenic place can also be rented out for private events.  The garden is quite lovely and the interior appears to be very modern.  You can see photos of the inside of the house at the club’s website: The Santa Clara Woman’s Club.

Not too far from the Adobe Woman’s Club is Santa Clara’s oldest structure, the Berryessa Adobe, located at 373 Jefferson Street, Santa Clara.  It is open Thursdays and Saturdays from 12noon to 4pm. It features early California artifacts. The Examiner has a great article, full of history on this site: read up!

The Peralta Adobe House in downtown San Jose close to San Pedro Square (at 75 West Saint John Street) can be toured if you pull a group together. (It is also very close to the Fallon House, and the two can both be seen on the same ticket.)  According to the History San Jose website, this is the oldest house in San Jose, built in 1797 and “the last remaining structure from El Pueblo de San José de Guadalupe.”

A few years ago, I did a “client appreciation” event with a tour of the Peralta Adobe and Fallon House.  At the time, anyone could tour these at any time by just showing up and buying a ticket.  The website now says that they need groups of ten or more to tour, so it sounds like another casualty of the Great Recession.  Those who did join me for my event seemed to really like it and I thought it was a good event so would recommend it to others.

Roberto-Suñol Adobe (aka Laura House): Less obvious is the Willow Glen adobe building hidden behind a wooden facade at 770 Lincoln Avenue in San Jose.  Dating from 1870, this adobe house is now home to law offices.  Most of the adobe cannot be seen, but the owners have kindly made visibile a portion of the original adobe construction. Originally, of course, it was a one story house, built in 1836  (have you ever heard of a two story adobe? No!).  According to stoppingpoints.com, “The one-story dwelling was enlarged in 1847 by the new owner, Antonio Suñol, the second story and balcony were added in 1853 by Captain Stefano Splivalo.”

In Milpitas, you can find the The Jose Maria Alviso Adobe, which also began as a one story adobe house and was later added onto with a second floor. As it was expanded, it grew into the one uniquely California style of architecture, the Monterey style.  Also in Milpitas is the Jose Higuera Adobe and Park.

In my own town of Los Gatos, there’s a hair salon/barber shop called the Old Adobe Hair Shop of Los Gatos too – but I cannot find any historical info on it (just business info). In Mountain View, there’s another on Moffett Blvd (that can also be rented out).

If you slow down, you’ll find hints of our collective history all around us – in San Jose, Santa Clara, Milpitas, Mountain View, Los Gatos and all over the “south bay”.   These are easy to miss…and wonderful to find and discover!

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.

Mid-century modern homes, including those designed by Joseph Eichler, dot the Silicon Valley & South Bay Area real estate landscape.  There are probably more than 5,000 Eichlers in Santa Clara County altogether, plus all the other homes of that genre with the similar modern style, which was influenced by the ranch and prarie styles as well as the dramatic work by Frank Lloyd Wright (open beam ceilings, nearly flat roofs, lots of exposed wood & glass windows stretching from the floor to the ceiling).  Eichlers, especially, put a premium on privacy from the street but open to the outdoors otherwise.

Not every community in Santa Clara County has Eichler homes, but most have the mid-century modern style homes & neighborhoods. These homes vary from tiny, modest cottages of 1100 square feet to large & elegant  houses of nearly 3,000 square feet, featuring big, central atriums or courtyards.  (There are also some co-ops in the valley too.)  The quality varies, as the homes were constructed by several different builders with different home buying budgets in mind.  Real estate prices range from “entry level” to very expensive, depending on the location (city and schools), size of the home & lot, and condition of the property. Most of them are now about 50 years old, though some are a little younger.

Some of the West Side Silicon Valley Communities which feature Eichler and Mid Century Modern Homes

In Los Gatos there are no Eichlers but there are a small handful of single family homes which are mid-century modern on Eastridge Drive (just off Blossom Hill Road and Hillbrook). There are a couple more at the end of Magnuson Terrace (off Magnuson Loop and Los Gatos Blvd).  Additionally, there are some smaller mid-50s homes on El Gato (and adjacent portions of Escobar) off of Los Gatos-Almaden Road. Unfortunately, not all of these homes are “well kept”, though many are.

Monte Sereno is home to 16 Eichler designed houses on Via Sereno beginning at the intersection of Winchester Blvd with Via Sereno.  These houses were built in the late 60s to early 70s.

Visit Saratoga and you’ll see 35 larger Eichler homes (on larger lots) just off Cox Avenue (“in the schools“) along De Havilland Drive. I showed one a few months ago and noticed that this street, despite enjoying the famed Saratoga Schools, is not so well kept – it could be that some neighbors were simply conserving water due to the then 10% water cutback demanded by San Jose Water due to the drought.  One home owner added on or remodeled but it was such that the architectural style of the original building was lost – a shame!  Many of these homes enjoy a creekside location.  The only real negative is that there’s freeway noise from nearby highway 85.  There are a few more Eichlers near the busy intersection of Quito & Allendale (facing Quito) along the Campbell border. 

The Willow Glen area of San Jose has an abundant supply of large & gracious Eichlers on wide roads: there appear to be hundreds of them spread out over several developments.  For the most part, these are beautiful neighborhoods with tree-lined, wide streets and a great sense of space. Most of these homes are more affordable than you’d expect and the reason is the public school scores in the area.  Had the homes been built out of the San Jose Unified School District area in into the Campbell schools area, they’d certainly sell for much, much more.  In that area is the very popular St. Christopher’s School (Catholic), which many kids in Willow Glen attend.

More affordable Eichlers can be found in central San Jose near Fruitvale and Bascom and again in parts of Sunnyvale.  In the least expensive areas, though, beware of deferred maintenance.  Last year I showed a home near Fruitvale in San Jose which was simply riddled with foundation cracks.  These are hard to repair with a slab foundation – it can mean jackhammering up the whole foundation! 

There are some mid-century moderns in the Cambrian Park area of San Jose both in the Rosswood/Bel Estos area (scattered in with some more traditional ranch style homes) and also just off Hillsdale and Foxworthy in the Hacienda Gardens neighborhood.

Cupertino and Santa Clara also have a good showing of Eichlers (Santa Clara also has “cooperatives”, which are a bit like condos or townhomes, which are Eichlers too). 

Continuing north, the supply of Eichlers in particular increases dramatically as you get to Los Altos and then even more in Mountain View and Palo Alto, where Eichler enclaves number in the thousands.  (Word of caution: some of these Mountain View homes are in the 100 year flood plain and it will require flood insurance if you purchase a home there  and utilize a loan.) Want to live on the Peninsula? You can find many mid-century modern homes there too.

Special concerns with mid century modern or Eichler homes

As with any 50 year old home, there are things to watch for in purchasing these properties! While many of the mid-century moderns are built on raised foundations, some aren’t – and Eichler’s aren’t. That wouldn’t be such a big deal except for the fact that the plumbing is embedded in the slab, and so is the radiant heating coils. If they go out, it can be a pain to replace them. (Eichler often built with copper pipes, luckily.) The radiant heating systems do sometimes fail and if/when that happens, homeowners can either add baseboard (which is fairly inexpensive and easy to do) or rip up the concrete and fix the coils.

A more common and persistent problem is with the open beam ceilings and the tar and gravel roofs over them: there’s no insulation.  Luckily, in recent years foam roofs have become a popular solution.  They not only protect the roof from the rain and other elements, but they insulate beautifully.  The downside is that if an area becomes damaged, you can’t “patch” it like you can with other roof types – instead, you really need to replace the whole roof. Yes, that’s expensive.  But clients of mine who’ve gotten the foam roof love it as their homes are more comfortable both in summer and in winter.

Many non-Eichler properties had plumming with galvanized steel pipes. Watch for that – those tend to last about 40 years, so if the home hasn’t been repiped it may be an expense waiting to happen.

A small concern with radiant heat is the type of floorcoverings that can be used over it. Often these homes are built with vinyl, linoleum or other hard surface flooring.  Carpeting can be difficult because the heated floors can be a problem.  So area rugs are usually preferred.

For further reading, please check out the Wikipedia article on Joseph Eichler and another on the Mid-Century Modern style.

What does it cost to buy an Eichler home in the San Jose, Los Gatos or Saratoga Area?

As of right now, prices range from a low of somewhere in the $500′s to well past a million dollars to purchase an Eichler style house.  These homes in Monte Sereno or Saratoga will cost much, much more than a similar home in Santa Clara or Willow Glen.  Browsing is perhaps the best way to get a feel for the pricing.

Some of the Eichler homes currently for sale or sale pending in Silicon Valley

If you’re interested in buying or selling one of these classic homes, please contact me today!

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Many newcomers to the San Jose & Silicon Valley areas want to buy new homes (or newer ones).  Santa Clara County, though, had a big “building boom” after World War II ranging from the 1940s through the 70s.  At the end of the building frenzy, most of the land was taken.  More importantly, most of the really good land was built up.

How old is the “average” San Jose home for sale?  Probably about 45 – 50 years old, on average.  Depending on where you’re looking, precisely, the homes could be younger or older on average. 

There are some nice communities of new and younger homes in Silicon Valley, but there aren’t a lot of them.  Most of the new home communities have houses on small lots.  Some are near high voltage power lines (homes on Taft in San Jose’s Cambrian Park area) or next to freeways (Summerhill development off Samaritan Drive in San Jose). 

It’s easier to find newer homes in Morgan Hill, Evergreen, Milpitas, and areas that held onto agriculture longer. Pockets of newer homes exist throughout the valley, and some of them are on good land (such as the Willows neighborhood of Willow Glen or the Almaden Winery area in Cambrian/Almaden). There’s a beautiful subdivision of luxury homes in Saratoga where the homes enjoy gracious, large lots.  That land used to belong to an order of Catholic sisters (Notre Dame de Namur).  Good land!  Much of the other good land was either horse property, orchards, or vineyards until somewhat recently. Small pockets of that remain, including the “North 40″ in Los Gatos – which I understand has been sold and is soon to be developed.

Several parts of our South Bay community have roots that go back into the 1800s or earlier: downtown San Jose, old Santa Clara, Willow Glen, Mountain View, Los Gatos, Campbell, Saratoga, Alum Rock Park… many of these neighborhoods have Victorian era houses.  Japantown, in San Jose’s downtown area, has some beautiful Spanish style homes dating from the 1920s. (There are only a few of original adobe houses left that date to the late 1700s.) 

Don’t rely too much on the age listed in the mls!

One thing to be aware of is that some homes that are said to be 60 or 80 years old may have been virtually rebuilt and “like new”.  Sometimes the MLS will show the older number but only reveal the drastic remodel in the comments. So if you’re looking for a younger home, don’t just search by the age listed in the MLS – it may not be a true representation of the home’s condition!

The condominium & townhouse market is improving dramatically now.  It is evident both in looking at the stats countywide and in my recent experiences holding open my townhouse listings in Saratoga and Sunnyvale as well as recently participating in the sale of a townhome in Almaden Valley (representing a buyer) – all different areas and price points but all very active.

Here are the numbers for May sales of condos and townhomes for all of Santa Clara  County:

As you can see, the days on market are shrinking and prices (both median and average) are rising.  A few numbers cut back slightly in May: the sale to list price ratio retreated a little to 99.9% and the pending properties went down a little too.  But the number of sales were up.

The “months of inventory” or absorption rate is a great way to know how much of a buyer’s or seller’s market it is in any given place. Six months is considered balanced, less is a seller’s market and more is a buyer’s market.  Here are the months of inventory for selected communities in the “west valley” area of Silicon Valley – they are all “seller’s markets”, but some are strong and some are approaching balanced:

Of course, this is still painting with a broad brush.  The absorption rate for any of these areas may not be accurate for the various price points or school districts that might be found there.  For instance, a large luxury townhouse in Los Gatos which is downtown might be a really different type of market than a small, entry level one bordering Campbell or Cambrian Park.

What everyone’s wondering is if this seller’s market for condominiums and townhouses will continue despite the end of the federal home buyer credit.  To utilize that credit, homes had to be in contract by April 30th.  Most of those should be closed now, or nearing that date at best.  So we’ll really know more as we move into summer. My sense, though, is that what’s driving this market is much more the affordable prices of homes and of loans. The credits are a bonus, but many in Silicon Valley make too much money to be able to use them.

For information on your particular part of the Silicon Valley condo or townhome market, please give me a call or email me!

The real estate news is so mixed it’s mind boggling, whether it’s a national perspective, one specific to California, the San Francisco Bay Area, the “south Bay”, Silicon Valley or even San Jose in particular.  It is anything but a uniform, monolithic market. Even so, it’s good to look at the big picture along side the hyper local level, and that’s what we’ll do today.

Today’s San Jose Mercury News featured a front page article by Sue McAllister (an excellent reporter) on Santa Clara County housing values.  She shares that Zillow says that we’ve hit bottom here in Santa Clara County.  That is certainly good news to home owners accross Silicon Valley!  And I don’t disagree that countywide, we’re definitely looking up right now.  No guarantees for the future, but Zillow says that the threat of a second or double dip no longer seems likely. Whew!

Unfortunately, there’s another real risk to this recovery and it’s not the “shadow industry”. This time it’s homeowners walking away because they’re underwater (not because they can’t afford to stay, but because they choose not to).  Sixty Minutes did a segment on this phenomena of home owners walking away last night., which you can watch via this link.

But back to today.  Looking at the big picture, Santa Clara County’s median sales price is up about 5% over a year ago (for both condos and houses). That doesn’t mean that homes have all appreciated 5%, but rather that half of all homes sold for more and half less at a point which is five percent greater than the amount of a year ago.  It does indicate improvement, but most of that is due to more expensive homes which are selling now.

Some areas are “selling like hotcakes” when a good home comes on the market and is priced aggressively.  In those areas, home prices are trending upwards.  The myth is that it’s happening everywhere, in every price range, and in every type of residential real estate for sale.  It’s just not true.

I cannot cover every part of the San Jose area, or every type of home for sale, but will provide a few examples (again) of how terribly local “the real estate market” is.  In some areas it can change block by block! 

What follows are graphs from Altos Research (to which I have a subscription) displaying the median list price of homes for sale in Sunnyvale, Santa Clara and Saratoga – both condominiums & townhouses as well as houses & duet homes.  The historical period shown for all is the last 3 years.

The median list price of Sunnyvale houses for sale.

And the same data in Sunnyvale but by price quartile. Please note how very different the market has been from one price point to the next.  The least expensive homes hit the “bottom” more recently than the most expensive ones – the top quartile had its worst period in the winter of 2008 but the lowest quartile hit it a full year later.

What about condos in Sunnyvale?

Viewed broadly, it does not look like the townhouse or condominium real estate market in Sunnyvale has hit bottom for sure.  We see a tiny uptick at the end – but it’s hardly what you could call “sustained” at this point.

 When we look at the market for Sunnyvale townhomes and condos by price quartile, it appears that the most expensive ones may be trending upward in price.  Are they leading the recovery?  Perhaps.  But we’ll need to see more of this to know for sure.

I think I’ve made my point that real estate is hyper local.  Santa Clara County is clearly in recovery as a whole, but not every part of the market is recovering – some parts are still faring quite badly and are seeing further price declines.  But let’s continue on and have a look at the median list price of Santa Clara homes for sale next.

Santa Clara does not look like a market in recovery or which has hit bottom yet. Maybe – but we need to see the lack of decline continue on a lot longer before we could be comfortable declaring that the worst is over.

Here we can see that the lowest priced homes really do appear to be doing better than the rest of the Santa Clara market.  The bottom middle quartile, though, still appears to be having a slippage in list prices.  This is a much different “picture” than just viewing the Sunnyvale market as a whole.

Condominiums and townhouses for sale in Santa Clara next:

The movement upwards is encouraging, but it started so recently that we’re not yet sure if this is a blip or a new trend. Hoping for the latter.

The newness of the trend is affirmed when we look at the Santa Clara condo market by quartile: mostly what we’re seeing is that the declines have stopped. That is good news, at least!

Finally, let’s see what’s happening in the high end or luxury market of Saratoga. 

What a bumpy market it is in Saratoga!  While it looks like “the worst” was about a year ago, the current downward trend is not comforting.  Is more bad news still ahead?  Let’s see how it looks by quartile.

Now isn’t this odd? It doesn’t look nearly so bad in Saratoga when broken down by quartiles!  The most expensive properties in Saratoga are doing the worst, and the most affordable ones are appreciating, though.    Perhaps a closer look still would help – just the top and bottom price points by themselves.  Here’s a view of the top quartile of the median list price of Saratoga homes for sale.

The luxury or estate market in Saratoga is NOT yet in recovery.  In fact, it is still in decline with no evidence of a recovery even begun yet.

And the bottom?  This chart represents the most affordable single family homes (houses & duet homes) for sale in Saratoga over the last three years.

Anyone shopping in Saratoga (especially in the areas with the very best schools) knows that this is an appreciating market – homes in this strata of the market are going up every month, especially if the home is in good shape and priced right.  Although the recovery there is still rather new, I do believe that this part of the market has seen its bottom and is truly in recovery.

Saratoga condos and townhouses – how’s the market?

The condos and townhouses in Saratoga had a little rally last summer, but then it dropped down lower in the winter and had been rising until recently. Will it look different by quartile?

Here again it looks like the bottom quartile, or most affordable Saratoga condos for sale, is recovering .  The upper price points now appear close to flat but the most expensive ones have been behaving very differently from the rest of the pack since last summer.  Perhaps this was a vote of confidence among those who are comfortable?  The luxury condominium market in Saratoga is more than merely shelter, of course, and most Santa Clara County home buyers cannot fathom purchasing a townhouse or condo over a million dollars, let alone pay the hefty home owner association dues that goes with that lifestyle.

Saratoga CA luxury townhouses and condominiums – median list price of homes for sale (top price quartile):

Summary

Today we had a look at the real estate markets in Sunnyvale, Santa Clara and Saratoga – both houses and condos and in all price points.  We can see that while the whole of Santa Clara County does appear to be past the bottom of the market, there are still some segments of it which are declining in value, and others are rising.  To make the most of your real estate purchase or sale, it is extremely important to understanding what is happening in your part of the market.  Please contact me to chat about buying or selling a home within your area, budget and home type within Silicon Valley.

How many of the Silicon Valley homes for sale are listed as short sales? How many are bank owned properties? This morning I did some time pulling the numbers out for my readers so that you can see the actual real estate figures.

What’s being counted below are homes for sale, including houses, duet homes, condominiums and townhouses (or townhomes) in the various areas of Santa Clara County listed below.

As was the case a year or two ago, most of the short sale activity is taking place in the most affordable price ranges. The higher priced areas are not immune, though – but because there are fewer distressed properties to choose from, they get purchased rather quickly, so we’d see a higher percentage of them among the pending sales rather than the available listings.

Today I did a post on this subject focusing specifically on the Los Gatos real estate market in terms of short sales today vs the last couple of years (and the question of whether or not the trend is to rising numbers of short sales available). To learn more, visit the article on my Live in Los Gatos blog.

For bargain hunting buyers of high end properties, then, it’s slim pickings!  In the entry level areas, there’s much more selection but also lots of competition.  Last week I was involved with some buyers in a bidding frenzy in a terribly underpriced Cambrian short sale: it got 43 offers!  (So please remember that the list price may be completely unrelated to the sales price.)

If you’re looking to buy or sell a home in Silicon Valley, it helps to have the assistance of a Realtor with a pulse on the market.  Please contact me for a confidential & no-obligation meeting today!

Today I was showing homes in Santa Clara to my buyers and saw one home with very “funky” (non compliant) strapping around the hot water heater. It was weird enough that I took a photo!

Unusual here – and confused – is the slanted lower strap that is in the top half as well as the bottom half of the water heater and goes around the ducting. Really bizarre!

What water heater strapping DOES require is a hefty strap in the top third and another in the bottom third of the water heater. Blocking may be required too. To see all of the requirements per the State of California, see the online directions for strapping water heaters (a how-to).

The tide is turning for Silicon Valley real estate: fewer listings are coming onto the market and more homes are being purchased by homebuyers anxious to get into a house before interest rates rise and the $8000 first time homebuyer’s credit expires.

The shift is most visible in areas with the most affordability, but even is more upscale, higher priced areas, it’s still a noticeable change.

Today I’ll share with you a series of graphs, by area, of single family homes in terms of new listings, current inventory, and pending sales (sales under contract).  These were created using our mls system (information deemed reliable but not guaranteed).

Here’s the “key” (since if I put it alongside each image it would not fit without making all of it unreadable):

Description of each graph is ABOVE the image.

Almaden Valley (95120 area of San Jose) - this is a more expensive part of Santa Clara County, but the market improvement is very clear. Cool market.

Blossom Valley (95123 and 95136 zip codes, an area of San Jose) – this is a very affordable part of Silicon Valley and has taken a huge hit on the “price rollback”.  But it’s getting better now – note the rise in sales, low number of new homes coming on the market and overall lessening of inventory. Number of pendings is almost the same as the total inventory. Hot market.

Cambrian Park (95124 & 95118 area of San Jose) – trends among listings, inventory, and sales for single family homes. The trend of less inventory and more sales is quite evident. Warm market overall – very hot under $500,000, cool in higher price ranges. (But hot only if prices are deeply reduced.)

Campbell (zip code 95008) – sales are up, new listings are declining, overall inventory is getting absorbed.

Cupertino – upscale Cupertino has improvement with numbers of sales and new listings are dropping off a bit, resulting in a slight trend change.

Evergreen – the Evergreen area of San Jose is a mix.  Parts are very expensive and some are very middle-class or entry level. This is one of the most dramatic change in available inventory anywhere in Santa Clara County. New listings are nearly non-existent and there are nearly as many pendings as there are available homes. The “good odds” and low level of oncoming listings probably has a lot to do with the deep pricing cuts there.  Many sellers would rather wait then sell now. Very warm to hot market in lower price ranges.

Los Gatos (area “16″ which also includes Monte Sereno) -  The same trend can be seen for increased numbers of sales, but on a lesser scale. If we were to break this down by price point and school district, though, we’d find that there’s a big difference from place to place within Los Gatos. There are many “micro markets” in the town. Biggest challenge: overpriced homes that aren’t selling because the buyers simply won’t pay that much today for most of the homes on the market. Cold Market

Monte Sereno is a very pricey part of Santa Clara County.  With just about 4000 residents, it is often viewed the same as Los Gatos but it’s a bit more expensive. Overall inventory is declinging, but sales are not robust and new listings keep coming.  Homebuyers, if you ever wanted to buy in Monte Sereno, now’s the time!  Cold Market

Santa Teresa – entry level area of San Jose – more affordable homes, better price cuts – homes are selling. Market is hot!

Santa Clara -Santa Clara is a middle class city in the heart of Silicon Valley, with a diversity of areas, housing types, and price points from entry level to mid-range. It’s a good guage of how the valley’s doing as a whole.  In the graph below, it is very clear that pendings are increasing (yellow), total inventory is decreasing slightly (orange) and new listings are not running rampant (red). This is fairly reflective of Santa Clara County as a whole. Overall market in Santa Clara is cool but improving.

Saratoga – like Monte Sereno, this cute city by the foothills is not for thin pocketbooks. While prices haven’t been pulled down severely, the numbers of sales are way down and new listings are still fairly high. Inventory is not being absorbed too well.  Of course, if prices would be dropped a bit, sales would pick up, but many sellers are hoping to wait it out.  Cold Market

Willow Glen – this quaint part of town features homes with a wide variety of styles, from those with unique, craftsman, Victorian, Spanish, mid-century modern or historic architecture to small bungalows and ranchette homes. Except in lowest price ranges, market is cool but improving.

In conclusion, the “Silicon Valley Real Estate Market” varies from place to place and price point to price point, but the overall trend is improving in terms of the number of sales and overall supply/demand.  It’s really a split market, though. The lowest priced homes that are cute and priced well are flying off the market with multiple offers.  The higher priced homes that are “testing the market” are just sitting.  The lowest priced homes are now being driven UP, but the highest priced homes, in most areas, are still being pulled DOWN.

Money Magazine’s 25 Top Earning Towns list (of residents with the highest median incomes) included three of our prized Silicon Valley communities: Saratoga (ranked #4), Los Altos (ranked #6) and Los Gatos (ranked #19). That’s quite a show! Of course, it doesn’t necessarily reflect the highest standard of living, as our real estate is quite pricey here, particularly in those three areas. (Monte Sereno isn’t mentioned, possibly because of its smaller size. If Almaden Valley were its own town, it probably would have made the list too.)

What do these three areas have in common, besides attracting high earners?

All have excellent public schools, scenic beauty, and low crime. Each one has a vibrant downtown area and a sense of community identity with festivals and events happening throughout the year. All of them have a history connected to the orchards, vineyards, and agriculture of days past and even today tend to have a lot of trees and open spaces. You can find wineries in or near each of them too, and farmer’s markets are found in each community also. All are nestled into the western foothills of Silicon Valley.

They are all unique, of course, with pros and cons depending on your own focus for commute, amenities, and even weather (Los Altos is closer to the bay and a little cooler than Los Gatos). If you want to go to San Francisco frequently, Los Altos will be more convenient. If you want to go to Santa Cruz and Monterey more often, Los Gatos will be closer.

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.PopeHandy.com & www.ValleyOfHeartsDelight.com
emailto: Mary@PopeHandy.com
Blog: www.LiveInLosGatos.com & www.ValleyOfHeartsDelight.com

Earlier today I updated my series on Silicon Valley short sales at my Live in Los Gatos blog, where I’ve been tracking the number of active listings in select parts of Santa Clara County which are offered for sale as short sales. Below please find the areas and dates I’ve charted:

To read the entire post, please continue on to Silicon Valley Short Sale Snapshot.