Over the last few days, Realtors from around Silicon Valley keep asking me, “Do you see a change in the market?” I’ve heard it several times. The answer is yes. But then again, it’s late October. This is seasonally normal!
We have become so used to the hyper inflated market of the last 2 years that the smallest moderation of that market seems to make people nervous. But what is seasonally typical? Usually we see a big runup in the first half of the year, followed by either a leveling off or even a lowering of values in the late part of the year. That’s the pattern that we see most often.
Realtors like to say that you can buy or sell any time of the year in the San Jose area – and it’s true. We don’t have the weather that they have in places like Buffalo to keep us indoors for 1/3 of the year! Even so, spring is hotter than fall. There are advantages to selling late in the year to be sure: for one, usually there’s less inventory (competition) so the odds of selling and closing are better. But in terms of pricing, spring is usually king.
Just not always.
Back to now: real estate agents in the San Jose area and the Peninsula are reporting smaller numbers of offers on properties and lower overbids. Homes selling over list price are still the norm in many areas, but where there used to be 10% overbids, perhaps there are 5% overbids. This is the general trend.
In some areas, and some price points, we continue to see enormous overbids in the 10% region, even while the area generally is averaging smaller ratios. The homes most likely to outperform the market are those which are super clean, remodeled, worry free, and on the lower end of pricing for the best schools or commute location. While everything else shows cooling, these homes do not. At least not yet.