Right now I’m working with a number of very frustrated home buyers.  Silicon Valley real estate inventory is painfully low, and in the lower price ranges especially, that means multiple offers are fairly common.  FHA home buyers, in particular, are getting out bid and out negotiated by all cash buyers, many of whom are investors.

How low is the inventory?  Let’s have a look at January’s inventory for houses & duet homes (“class 1″ or single family homes) over the last ten years in Santa Clara County (San Jose, Los Gatos, Campbell, etc.):

2012  1,382
2011  2,007
2010  2,426
2009  4,759
2008  4,872
2007  2,698
2006  2,202
2005  1,285
2004  1,612
2003  3,119

The average January inventory of available houses over the last 10 years is 2,636.  At 1,382, January 2012′s available inventory of houses for sale in the San Jose area was just 52% of normal.  It’s not really much different now, in early February (just did a quick check on the MLS and it’s  1509 houses now – 630 have sold & closed in the last 30 days so that’s 2.4 months of inventory – a hot seller’s market).  This is what constitutes a very severe inventory shortage.

Demand hasn’t slackened, but supply has.  You know what that means – it will push prices up, it will make buyers crazy feeling.

Why is inventory so low?

A common question is this: why is inventory so low?  I believe that there are a few drivers.  First, many home owners who would like to move really need more equity to do so.  They are waiting for the market to recover.  Some may be waiting for prices to return to their previous highs (they could be waiting awhile). Others just need a little more to make the move possible at all.

Many owners of higher priced homes are holding on until the second half of 2012, when it is expected that there will be more people with buying power due to recent and upcoming IPOs.  Economists are now predicting a bit of a frenzy the second half of this year with prices in more expensive homes getting pushed up due to competition from employees of various high tech firms.  Smart buyers are trying to get in before that hits – a real challenge given the inventory situation.

Reality check: not every house is selling!

The best properties are selling well – those which are newer or nicely remodeled, in turn key condition, easy to see, great marketing with multiple photos, appropriate MLS exposure and priced aggressively.  This is what every buyer wants, the perfect house.  Most of my clients tell me that they are willing to replace carpet and repaint, but they don’t want to do anything big, such as kitchen or bathroom remodels, removing a pool, foundation or drainage repairs, etc.  No one does!

One of the easiest ways of improving your odds on being able to purchase a house is to move away from the new or fully remodeled vision of your ideal house.  Lower your budget a little, decide to prefer homes that have been sitting on the market not due to location issues, but rather to pricing or condition issues – both of which can be fixed.

For instance, many home buyers will take a pass on properties which have a pool in the backyard.  A few months back, I did some research and found that houses with pools are harder to sell right now.  Appraisers count a pool as an improvement, but many consumers view it as a liability – an ongoing monthly expense to heat and maintain and a risk if there are small children.  Many think that it will be overwhelmingly difficult to remove and relandscape a pool, so will not even consider writing an offer if the property includes an in ground pool.

Truth is, it’s not that hard to hire a company to redo a backyard; it is not invasive the way a kitchen remodel is.  You could have it done before even moving in!  The cost varies on whether you want the pool fully removed or partially as well as how to relandscape afterwards.  I have seen bids for pool demolition work under $10,000 (relandscaping extra) with more bids between $10,000 and $25,000.  Lawn and sprinklers are not so expensive to add!

The pool issue is just one example – there are many other properties for sale which are passed over due to the condition not being ideal.  Remodeling can feel a little scary but when inventory is so tight, it can be the ticket to home ownership.

Likewise with over priced properties.  Although most homes sell within a couple of percent of list price, there are exceptions.  Sometimes real estate is badly overpriced, and in those cases you may get a seller to agree to a larger price reduction – 10% may even fly.  (This is unusual, I would note. Usually if a house is not worth within 5% of list price, the seller is unreasonable and won’t accept an offer which is less. But sometimes it can work.)

Here’s to the over priced ugly duckling.  It could be your best friend when inventory is rock bottom!

How’s the Cupertino real estate market right now? Let’s start with the most basic window into conditions: supply and demand. (This graph and more info comes from my Cupertino Real Estate Report. Please click on the link for much more data and information – with statistics and trends dating back many years. Also you will find reports which are monthly, quarterly and annually generated. Finally, there’s a “property analysis” tab which enables you to check sales – and see images – around any Cupertino address. Please allow the analysis tab to do its slow load – it’s worth it – enjoy!)

Cupertino Real Estate Supply and Demand

Cupertino Real Estate Market Barometer of Supply and Demand

The realty market barometer is going through the roof!  This implies that it’s very easy for Cupertino home sellers to get their properties into contract and to the closing table, that it is a hot seller’s market in Cupertino.  Please note the darkest line reflects housing inventory – and it’s been plummeting for months.  (Look at each year for October through December and you will note that the pattern is seasonal – but the actual number of homes available does vary considerably.)  Now please note the pale gray line, which indicates the number of homes selling and closing escrow.  The bigger the gap between these lines, the more choices buyers have, and the narrower the gap, the fewer.  Right now, for the first time covered by the chart above, these lines have met, meaning that homes are selling at the same rate that they are coming on the market.  When supply matches or outpaces demand, prices nearly always rise.

But what about home prices in Cupertino?

Here’s a look at the numbers, in brief, as reported with closed sales in December 2011.  Surprisingly, although the market appears to be very hot, prices don’t seem to reflect that – perhaps “yet”.  The median sales price of houses in Cupertino are off significantly from both the month prior and the year prior, and the average sales price is down a little. The number of sales is off a little and the list price to sales price is off some too (both year over year and month over month). Meanwhile, the days on market are growing pretty steadily.

What’s happening? Why this contradiction between the market barometer and pricing?   First, the days on market reflect the inventory which recently sold, not the inventory which is available today.  This tells us that many homes that have been on the market awhile are now being purchased. (Probably others went off the market for the holidays, which is typical for the season.)

With interest rates for conforming loans dipping below 4% (I believe this is an all time historic low), many buyers are deciding it’s time to get off the fence and purchase a house at last.  But there really isn’t much inventory – it’s about 34% lower than the month before and almost 38% lower than the year before!

I think that we will see prices beginning to move upwards with January’s closings.  The market this month in the west valley areas is much, much more active than a year ago.  This is anecdotal but I have been speaking with a lot of Realtors about how busy they are and everyone seems to be on overload with new buyers trying to get a home before prices or interest rates go up.  I expect to see the prices of houses being sold in Los Gatos, Saratoga, Cupertino – at least in the more affordable price points of these areas – to tick upwards this month.  We’ll know in early February if I’m correct!

Now let’s turn to another tool to see how the Cupertino market is faring for listed properties.  For this I will use graphs from Altos Research, to which I also have a subscription. These are LIVE CHARTS and will automatically update themselves weekly – so even if the article is older, this info is now!

Cupertino Median List Prices Compared to Neighboring Saratoga, Sunnyvale and Los Altos

We know that the median sales price in Cupertino has slipped. But what of the list price, and how does it compare to other areas nearby?

Los Altos is faring the best of these 4 areas. Saratoga was dippping but now rising again. Sunnyvale has been somewhat flat recently. But Cupertino’s prices are continuing to fall. Perhaps these low prices are the drivers for the crazy hot market activity.

Cupertino median list price of houses by price quartile

Focusing just on Cupertino, let’s see how the information looks if we break it down into the pricing tier. Often the entry level houses are a very different “market” than the luxury homes segment.

The last few months have had noticeable declines for the lowest three segments, but there’s been an uptick (until recently) for the most expensive properties in this city.

What if we look back more than a year? Combining the quartiles, the trends look pretty stark:

Here’s the same data just for the top quartile, the most expensive properties in Cupertino:

For the 2nd top tier (upper middle):

3rd level or lower middle:

And most affordable Cupertino houses or lowest quartile:

Cupertino Days on Market by Price Quartile: What’s Selling Fastest

Not surprisingly, the luxury market has had a harder time selling than entry level houses in Cupertino. This is true for most of the West Valley areas of Santa Clara County. Here’s a look at the days on market (DOM) for Cupertino by price point over the last year.

Remember, all real estate is local. For information on your exact area or price point, please contact me. I work with my clients to pinpoint the pricing.

What drives the Cupertino real estate market?

The residential real estate market in Cupertino, California, is driven in large part by the extremely high quality of its local public schools.  Many in Silicon Valley would state that for San Jose area home buyers, Cupertino offers the best “bang for the buck” when one lines up the cost of purchasing a home to the schools’ API scores. (Conversely, some residents are concerned that the very top schools – including but not limited to Cupertino – are so focused on academics that there may be too much pressure on kids and may lack balance for them.)

Other drivers are, of course, the local economy (such as the initial public offerings happening with some of the Silicon Valley tech giants), the availability of more affordable financing, and how the realty market in general is performing for any particular price point or particular school area. (Even within Cupertino, some schools are much more in demand than others.)  Comments in this article refer generally to this city of about 50,000 residents – real estate is local, though, so for precise information in any given area or tier of the market, please contact me!

Houses for sale in Cupertino California

Please browse houses for sale in Cupertino, listed from the lowest prices up to the highest.

Showing properties 1 - 5 of 17. See more city of Cupertino real estate.
(all data current as of 2/10/2012)

1. $649,900 : 10160 Calvert Dr, Cupertino
   
   3 beds, 2 full baths

   Home size: 1,562 sq ft

   Lot size: 5,643 sq ft
   
2. $748,800 : 18920 Tilson Av, Cupertino
   
   3 beds, 1 full bath

   Home size: 1,039 sq ft

   Lot size: 5,400 sq ft
   
3. $749,000 : 10335 Moretti Dr, Cupertino
   
   4 beds, 3 full baths

   Home size: 1,267 sq ft

   Lot size: 4,947 sq ft
   
4. $839,000 : 10240 Yoshino Pl, Cupertino
   
   3 beds, 2 full baths

   Home size: 1,688 sq ft

   Lot size: 3,168 sq ft
   
5. $879,000 : 10285 Moretti Dr, Cupertino
   
   4 beds, 3 full baths

   Home size: 1,787 sq ft

   Lot size: 6,000 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

How’s the Saratoga California real estate market?

Annual Saratoga CA Real Estate Update:

Saratoga’s prices slipped a bit in 2011 over 2010.  Here are the basic numbers with the stats for the annual review, including median sales price and average sales price of houses sold (see the Saratoga Real Estate Report for even more data):

Median Sale Price 2011 = $1,480,000   2010 = $1,510,000 (-2.0%)

Average Sale Price 2011 = $1,636,300   2010 = $1,657,140 (-1.3%)

For condominiums and townhouses it was stronger (finally, they’ve taken a beating!):

Median Sale Price 2011 =  $660,000     2010 =  $612,500 (+7.8%)

Average Sale Price  2011 = $684,500    2010 =  $640,895 (+6.8%)

To see much more information please visit the full annual Real Estate Report for Saratoga condos and townhomes

Monthly Real Estate Update for Saratoga:

Sales of single family homes were up but prices were down month over month – but way, way up over December 2010! It’s taking much longer to sell houses compared to a year ago too – but look at the prices from a year ago – the low price went with a very brisk sale time (average 17 days on the market).  That was nuts both for low pricing and for speed!

What about Saratoga condos for sale and sold? There are very, very few of these which sell in any given month, so the numbers can very easily jump around like crazy – and therefore aren’t terribly helpful. 

Days on market are double a year ago and triple even a month ago (this IS helpful), prices are down from last month (but again, that can mean very little since a Saratoga Oaks townhouse with a view will sell for much more than a small condo with a less desirable location).

To really understand the condo and townhouse market it’s better to see actual sales and compare them quarter by quarter, using similar units.  If you are interested in buying or selling a condo or townhouse in Saratoga, don’t go it alone or rely on online stats – give me a call and we will crunch the numbers specifically for your home and pinpoint the pricing.

Median List Prices of Saratoga Homes for Sale

First, a graph displaying the overview of the median list prices for condominiums and single family homes in Saratoga – all price quartiles combined:

In general, the seller’s market is showing itself for houses in the fact that list prices are rising.  Not so with condo and townhouse pricing. That’s a much cooler market.

Next, the median list prices for single family homes with a breakdown by price quartile. (Please note that the info would be even more precise if broken down by school district, but this particular program doesn’t yet filter by schools.)

In most price points, the list prices are now rising slightly, but most of all in entry level homes. In the last few months we’ve seen the high end home sales start to pick up in Saratoga, with a good run up in late 2010 before sliding earlier.  Starting to improve now, though.

And now, list price of condos by price quartiles.

Interestingly, the condo market is not enjoying at all the decent seller’s market seen among houses in this city.  Every price point appears to be suffering, but the high end most of all.

Inventory of both houses & condos in Saratoga

It’s seasonally typical to have more inventory in summer than other times of the year. Going back a few more years (see below), please note where the peaks are found – always sometime in summer. (Single family homes only.)

It’s less clear, but still visible, with condominiums and townhouses in Saratoga:

Average Days on Market for Saratoga Homes for Sale

Houses by quartile is not much different – DOM was rising across all price points and has been since August until spring, when the bottom and two quartiles (blue and green) reversed the trend. These are the “hotter”or improving segments of the market right now.

It is strangely disjointed in the Saratoga Condo market, though. I can’t explain why this had been so “all over the board” based on just this data. But since August, all four groups appear to be following the same general trend.

My suspicion is that the homes with the better schools are faring the best, but that’s just a hunch based on how well homes usually sell – it’s not provable with this info at hand.

If you’re interested in buying or selling a Saratoga home, please contact me. I’ll be happy to meet with you for a no obligation initial consultation.

Saratoga Real Estate Listings – Saratoga Homes for Sale – Condos, Townhouses & Houses for Sale in Saratoga

If you’d like to browse Saratoga homes for sale, I invite you to have a look here! Below please find all properties currently listed as available on our local MLS.  Please be advised that there are a number of different property types and school districts listed here.  For more precise information on houses, condos or town houses on the market, please contact me via email or complete a form at SiliconValleyHomeHunt.com or on my popehandy.com website.  Either way it will come to me and I will personally set up your search for a Saratoga property. (If you are moving to the South Bay area from far away, please also see my Silicon Valley relocation website for helpful tips.)

Showing properties 1 - 5 of 68. See more city of Saratoga real estate.
(all data current as of 2/10/2012)

1. $3,285,000 : 14982 Sobey Rd, Saratoga
   
   6 beds, 5 full, 1 part baths

   Home size: 4,895 sq ft

   Lot size: 1.04 ac
   
2. $915,000 : 18775 Mcfarland Av, Saratoga
   
   4 beds, 2 full baths

   Home size: 1,894 sq ft

   Lot size: 10,000 sq ft
   
3. $2,495,000 : 12888 Chiquita Ct, Saratoga
   
   4 beds, 3 full, 1 part baths

   Home size: 4,400 sq ft

   Lot size: 1.01 ac
   
4. $890,000 : 14451 Oak Pl, Saratoga
   
   2 beds, 2 full baths

   Home size: 913 sq ft

   Lot size: 8,925 sq ft
   
5. $625,000 : 14660 Big Basin Wy #C, Saratoga
   
   3 beds, 2 full baths

   Home size: 1,408 sq ft

   Lot size: 1,496 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Every couple of weeks I update this post to bring fresh news and data on the Cambrian Park real estate market. On Dec 9th  I went onto the MLS and ran the “months of inventory” or absorption rate of houses and duet homes (what our MLS calls “class 1″)  in “area 14″ or Cambrian area of San Jose. This time I broke it down into price points as well as the type of sale (regular, short sale, bank owned)  so you can pinpoint the pricing for the various segments of the Cambrian market. (Reminder: months of inventory reflects how long it will take to sell a property if sales continue at the current rate. Six months or so is considered “balanced”. More is a buyer’s market and less is a seller’s.)

**please note – typo below – numbers were crunched December 9th, 2011, not December 10th.

Cambrian Park (San Jose) Months of Inventory by sale type & price point Dec 9, 2011

What’s selling? “Regular sales” – non distressed. Not faring so well? Short sales.  In many price points, although many are under contract or pending, FEW – sometimes none – are making it to the closing table.  We are hearing a lot about the streamlined processes for short sales, but these numbers hint at a different reality, namely that Silicon Valley and Cambrian short sales sell but often don’t close escrow.

What is the typical kind of home and price for these neighborhoods?  Of the homes which transferred ownership in the last 30 days, a typical house cost about $600,000, has about 1600 square feet and sits on a lot of around 6700 square feet (and is “partially updated”, not fully remodeled).  The price per square foot averaged $376 but ran from $205 (distressed and on a hugely busy road) to $513 (close to the hills near Almaden and Los Gatos).  If the home you want to buy or sell needs remodeling or is “all original” it’s probably going to sell for less. If it’s in a great area, is a regular sale and absolutely turnkey and fully remodeled, it’ll sell for more.  A beautifully remodeled Cambrian house with 3 bed, 2 bath and 1200 square feet can easily run $600,000 or more if it’s a regular sale and in a good area with no “issues” (high voltage lines, backing to busy road or school etc.).

What about the pending sales?

As of this morning, there are 95 houses & duet homes which are sale pending.  Of those, 39 are regular sales (a mere 41%!), 48 are short sales and 8 are bank owned properties (REOs).  How do the pendings compare to the homes sold?  Here’s a quick breakdown for all price ranges in “area 14″ of San Jose:

ALL types Pending – 95   Sold in last 30 days – 37
Regular sales – 39   Sold in last 30 days – 32
Short sales -  48   Sold in last 30 days – 1
Bank owned sales – 8   Sold in last 30 days – 2

This underlines the fact that the short sales are getting into contract…but just not getting to the closing table! Bank owned homes are better, but the ratio of pendings to closings is much, much better with regular sales.  This explains why the regular sales are the hottest ticket in Cambrian Park right now: buyers don’t want to just buy, they want to close!

Some sellers are borderline on being able to sell without either having to bring cash to the closing table or having to attempt a short sale.  What do these numbers suggest?  That if you really want to sell and can do it – you may be best off doing a regular sale, even if you need to bring money to the title company to make it work.   (This is general advice only, your own situation may be different – please consult with your Realtor, lawyer and tax advisor before deciding to do, or not to do, a short sale.)

Here’s a snapshot view what was happening in the 95124 and 95118 areas of San Jose as of December 2nd, 2011. (My last update for this part of San Jose -  a mini update.)

Cambrian Park (San Jose) quick real estate stats for houses Dec 2, 2011

Interestingly, the hottest segment of this market is not the distressed sales, but regular ones, which are being absorbed three times as fast as the short sales or bank owned homes on the market. And it’s understandable: REOs don’t provide any disclosures and may contain surprises after close of escrow, and short sales may never close.  Just look at the huge number of pendings as opposed to the short sales which actually become a finalized transaction!  We hear that the odds are improving on short sales closing, but this graph doesn’t validate that impression at all.

Cambrian San Jose Real Estate Trends & Statistics for Sold Homes

It’s been a “hot sellers market” in the Cambrian district of San Jose for many months now with most homes that sell going fairly close to list price (1-2% off on average).  That doesn’t mean that the best idea is to always offer less than list price, though, as many homes are selling at or above list price.

If we took a close look at what’s selling and closed recently, we would find that some Cambrian houses are selling for more than list price, some right at list price and others below or well under the offered price.  Some Cambrian real estate is listed strategically low in order to get multiple offers and drive the price up.  Some are overpriced and others are priced “right on the money”.

Data on real estate solds in Cambrian area of San Jose, for November, October, September and August 2011 among houses from my Real Estate Report:

Next, October:

September:

Next, August (note that prices were higher, pending prices were higher in August as opposed to September).

Inventory is down about 32% from a year ago.  Prices are down, too, both year over year and month over month. Even so, the Cambrian real estate market is fairly hot, a good strong seller’s market as long as homes are priced well, staged well, and marketed well.  That doesn’t mean that every home is selling, but those which are nicely staged and marketed and correctly priced are selling at a good pace – and many of them get multiple offers, as the overbids attest.

Just now I checked what has closed in the Cambrian area in the last 30 days. There were 36 houses that closed. Of them 9 sold over list price, a few sold right at list price but most sold under list (and a very few sold grossly lower).

Now let’s work with Altos Research’s graphs and get a feel for the Cambrian realty market in “real time”.  These use list prices, whereas my REReport uses sold data.

First, the statistics by quartile for houses in San Jose 95118:

Next, the stats and trends by price quartile for houses in San Jose 95124:

Median list price of homes for sale in 95124 and 95118:

Very interesting that the 95124 pricing appears to be swinging upward while the 95118 pricing continues to go down.  I believe that this is mainly because the schools in 95124 have been trending upward strongly with the API scores.  Prices are also at a higher level, and those are less impacted by short sales and REOs countywide.  So it may be the result of multiple factors.  (95124 is about 2/3 of the Cambrian real estate market.)

Inventory in Cambrian area of San Jose 95124, 95118:

Surprising, isn’t it, to see how differently these two San Jose zip codes are behaving from each other?

Average days on Market in San Jose’s Cambrian area

And again, really different trends on these neighboring zips, both in Cambrian!

Another anecdotal story to share: Recently I closed the sale on my listing at 5114 Nerissa Way in Cambrian with Union Schools and Alta Vista in particular. We were listed at $579,000 and received 4 offers and sold at $585,000. Interestingly, we received 2 nearly identical “best” offers, both at $585,000. One was completely As Is and the other was almost As Is (they wanted a fumigation and pest clearance provided).  That is usually a pretty good affirmation of market value, and the property did appraise at the sales price.  The other two offers we got were below list price.  One was all cash and it was extremely low.  Buyers who are purchasing without financing sometimes misunderstand the type of discount that their all-cash status will get for them, so sometimes the worst offers are all cash and that was the case this time.

Want more info on your neighborhood, your house, or your target home to buy? Please call me!

Showing properties 1 - 5 of 64. See more 95124 zip code real estate.
(all data current as of 2/10/2012)

1. $685,000 : 1671 Zinnia Ln, San Jose
   
   3 beds, 2 full baths

   Home size: 1,410 sq ft

   Lot size: 6,240 sq ft
   
2. $549,900 : 2423 Loment Pl, San Jose
   
   3 beds, 2 full baths

   Home size: 1,539 sq ft

   Lot size: 4,232 sq ft
   
3. $639,000 : 1695 Merrill Dr, San Jose
   
   4 beds, 2 full baths

   Home size: 1,396 sq ft

   Lot size: 7,200 sq ft
   
4. $550,000 : 5051 Nerissa Wy, San Jose
   
   3 beds, 2 full baths

   Home size: 1,120 sq ft

   Lot size: 10,824 sq ft
   
5. $748,000 : 1830 Curtner Av, San Jose
   
   5 beds, 2 full, 1 part baths

   Home size: 2,191 sq ft

   Lot size: 6,000 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Showing properties 1 - 5 of 28. See more 95118 zip code real estate.
(all data current as of 2/10/2012)

1. $575,000 : 3213 Gardendale Dr, San Jose
   
   4 beds, 2 full, 1 part baths

   Home size: 1,800 sq ft

   Lot size: 6,313 sq ft
   
2. $489,900 : 1349 Lyonsville Ln, San Jose
   
   4 beds, 2 full baths

   Home size: 1,692 sq ft

   Lot size: 9,583 sq ft
   
3. $499,000 : 3119 Santa Margarita Av, San Jose
   
   3 beds, 1 full bath

   Home size: 1,071 sq ft

   Lot size: 7,840 sq ft
   
4. $430,000 : 1560 Hillsdale Av, San Jose
   
   4 beds, 2 full, 1 part baths

   Home size: 1,654 sq ft

   Lot size: 6,890 sq ft
   
5. $534,888 : 3183 Cheshire Dr, San Jose
   
   3 beds, 2 full baths

   Home size: 1,570 sq ft

   Lot size: 6,000 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Browse lists of Cambrian & Cambrian Park homes for sale:
Houses for sale in the 95118 part of Cambrian
Cambrian Park Houses for Sale in 95124

Mary Pope-Handy, Realtor, CRS, ABR, e-PRO, SRES, ASP, CNHS, ACRE
Helping Nice Folks to Buy & Sell Homes Since 1993
Co-Author: “Get The Best Deal When Selling Your Home In Silicon Valley”
408 204-7673 (Cell)
emailto: Mary (at) PopeHandy.com
Blog: www.LiveInLosGatos.com & www.ValleyOfHeartsDelight.com

How’s the real estate market in the Willow Glen area of San Jose?  Like the greater Silicon Valley region, Willow Glen is comprised of many smaller micro-markets.  It will be different in north Willow Glen, Palm Haven or in a walk-to-town area than it will be in the Dry Creek area or St. Francis Woods neighborhood – let alone differences for school districts, price point, sale type (regular versus short sale or bank owned), zip code and home type!  It’s a patchwork of all these smaller markets, in other words.  What’s happening in one segment might be very different than in another.

Today’s post will be the broad view of Willow Glen and comments may not apply to your specific property – for info on your neighborhood, call or email me!

Disclaimers aside, overall it is a seller’s market in Willow Glen right now, but prices are slipping a little and not everything is selling (and certainly not getting the prices that many sellers want).  Some of this is seasonal – prices often fall a little in summer, so it may not be anything to be alarmed about.

Below are the basic numbers, stats and trends from the closed sales of houses in June and July:

and July

And next, of Willow Glen condos, where it’s been a cold buyer’s marke but recently heated up:

And June numbers for Willow Glen condos -

What about home prices in Willow Glen?

Below please find the Altos Charts (to which I have a subscription). NB Altos uses LIST prices, not solds (also they go by zips or cities, so don’t cover Willow Glen per se with it’s partial entry into the 95124 zip).

1 – Houses in the 95125 zip code – history, all prices combined.

2 – Houses in the San Jose, 95125 zip code, by price quartile over last 180 days

3 – Condominiums and townhouses in Willow Glen, San Jose 95125 – all quartiles combined over the last few years for median list price:

4 – Condo and townhomes, median list price, by quartile, last 180 days only:

It is interesting to see the rise in list prices here as opposed to the overall DROP in sales prices we saw on the RE Report. Of course this could be a function of all kinds of things, including the impact of distressed sales.

All kinds of things can impact the probable buyer’s market for a particular house or home, but especially distressed sales nearby. For information on what the market is doing in your exact neighborhood, please call or email me today.

Willow Glen homes for sale

Browse residential properties – houses, duet homes, condos and townhomes in Willow Glen which are listed for sale on the MLS by type below.

1. Listings of houses for sale in Willow Glen, San Jose 95125

Showing properties 1 - 5 of 90. See more 95125 zip code real estate.
(all data current as of 2/10/2012)

1. $299,900 : 380 Fuller Av,
   
   2 beds, 1 full bath

   Home size: 1,064 sq ft

   Lot size: 5,400 sq ft
   
2. $825,000 : 1701 Grace Av,
   
   3 beds, 2 full baths

   Home size: 2,104 sq ft

   Lot size: 7,830 sq ft
   
3. $997,000 : 1820 Johnston Av, San Jose
   
   4 beds, 3 full baths

   Home size: 2,560 sq ft

   Lot size: 5,757 sq ft
   
4. $1,249,000 : 1740 Cabana Dr, San Jose
   
   3 beds, 3 full baths

   Home size: 2,809 sq ft

   Lot size: 14,784 sq ft
   
5. $435,000 : 1720 Willowhurst Av, San Jose
   
   2 beds, 2 full baths

   Home size: 1,217 sq ft

   Lot size: 7,350 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Showing properties 1 - 5 of 13. See more 95125 zip code real estate.
(all data current as of 2/10/2012)

1. $380,000 : 1186 Bird Av,
   
   2 beds, 2 full, 1 part baths

   Home size: 1,282 sq ft

   Lot size: 814 sq ft
   
2. $310,000 : 1360 Greenwich Ct, San Jose
   
   1 bed, 1 full, 1 part baths

   Home size: 970 sq ft

   Lot size: 871 sq ft
   
3. $369,000 : 1908 Huxley Ct, San Jose
   
   2 beds, 1 full, 1 part baths

   Home size: 1,004 sq ft

   Lot size: 600 sq ft
   
4. $562,000 : 2348 Lincoln Av, San Jose
   
   2 beds, 2 full, 1 part baths

   Home size: 1,641 sq ft

   Lot size: 3,060 sq ft
   
5. $479,000 : 2690 Villa Cortona Wy, San Jose
   
   4 beds, 3 full, 1 part baths

   Home size: 1,963 sq ft

   Lot size: 1,176 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

3. Listings of condominiums (condos) for sale in Willow Glen, San Jose 95125

Showing properties 1 - 5 of 8. See more 95125 zip code real estate.
(all data current as of 2/10/2012)

1. $555,000 : 2093 Wente Wy, San Jose
   
   3 beds, 2 full, 1 part baths

   Home size: 1,444 sq ft

   Lot size: 435 sq ft
   
2. $366,000 : 2132 Sunstruck Ct, San Jose
   
   2 beds, 2 full baths

   Home size: 1,144 sq ft

   Lot size: 1,566 sq ft
   
3. $440,000 : 1958 Foxhall Lp, San Jose
   
   2 beds, 2 full baths

   Home size: 1,071 sq ft

   Lot size: 1,500 sq ft
   
4. $434,950 : 1833 Ashmeade Ct, San Jose
   
   2 beds, 2 full baths

   Home size: 1,071 sq ft

   Lot size: 1,500 sq ft
   
5. $299,000 : 509 Dix Wy, San Jose
   
   4 beds, 2 full, 1 part baths

   Home size: 1,426 sq ft

   Lot size: 2,116 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Multiple offers have returned to many segments of the Silicon Valley real estate market.  We are hearing about them in Palo Alto, Cupertino, Mountain View – areas where newly minted IPO money is having an impact – but also in more modest, middle class areas such as San Jose’s Cambrian neighborhood. The trend appears to be spreading.

What Silicon Valley home sellers need to know and do to attract multiple offers

If you’re a Silicon Valley home seller, what do you need to know to try to get multiples on your home?  What should you beware of?  In short, here’s what needs to happen if you want to attract multiple offers on your home for sale:

1. The home must be turnkey, either fully remodeled or close to it – it must look like there’s nothing or very little for a buyer to do.  In addition to being turnkey, it must be squeaky clean and well staged! It needs to be comfortable – not too hot, not too cold. You want buyers and their agent to linger longer.
   
2. The price must be at or even under market value.  That is, you must be willing to price it aggressively.  Think it’s worth $1,050,000?  You might list it at $999,999 to get in under a major price threshold and to be the very best, most attractive property for the money. Yes, it might be under priced.  Over priced listings get either one offer at best or, more likely, none at all.
3. The property must be highly accessible. If it is hard to see, you probably won’t get multiple offers (and may get none at all).  (Please see articles on accessibility and on open houses.)
4. Finally, the property must be well marketed.  This includes a wide range of factors ranging from photographs, text, fliers, signs, and even the commission rate offered to the buyer’s side.

What Silicon Valley home buyers need to know and do to compete with multiple offers

If you’re a Silicon Valley home buyer, how do you win out in multiples without giving away all of your rights or overpaying for your house/home?

Over the last few years, I’ve written a number of articles about multiple offers and tips for buyers when competing (concepts to beware of, issues around contingencies, financing and more).  This is a bit like a multi-chapter ebook on how to work with multiple offers.  I hope it’s helpful!

By way of quick summary: you must cover a few areas very, very well:

1. You must be pre-approved by a reputable lender (fully pre-approved)
2. You must have a strong down payment (20% or more)
3. You must be willing to put 3% down for your initial deposit (also called a good faith deposit)
4. You must have a good agent helping you – he or she must do a good job completing the paperwork (it needs to be thorough and without any major mistakes), must communicate well with the listing agent and represent you and himself/herself as a great team with which the listing agent and sellers will want to work
5. You must have an excellent sense of pricing.  Your Realtor should “run the comps” for you, or may even prepare a competitive or comparative market analysis on the home you wish to purchase.  Pay attention to where the value  lies – sometimes that has little to do with the list price!
6. Be prepared to balance out the price and terms offered so that you do not feel like you are giving away all your rights.  Some real estate agents may push consumers to write contracts with no contingencies for home inspection, property condition, appraisal or finance.  I believe that this is a risky and unwarranted practice – but learn about it since your competitors may be doing this.
7. Read all of the articles below – they are here to help you!

Tips for Writing a Competitive Offer  Part One

Writing an Offer in a Multiples Situation? Financing Tips Part 2

Writing Strong Offers: More Financing Tips Part 3

Tips for Home Buyers Competing Against Multiple Offers – More Financing Tips Part 4

Competing Against Multiple Offers: Contingencies and Timeframes Part 5

Real Estate Purchase Offer Terms to Consider When Competing in Multiple Offers  Part 6

Sometimes the List Price Isn’t the Expected Sales Price, So Run Comps!

The Advantages of Presenting and Receiving Offers In Person

Interested in working with an agent who’s highly experienced with multiple offers?  Call or email me today!

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.

Homes in Saratoga, CA: real estate market trends and statistics for houses as well as condominiums and townhouses.

The real estate market in Saratoga improved a bit last month. But, as always, it really depends on what subset of the market you’re considering. It will be much different between price points, for instance (as well as between school districts, proximity to town, views, acreage, etc.). Today we’ll review the broad trends in Saratoga 95070 to get a general feel for the conditions but this could be very different for the home you own or want to purchase because real estate is always very local.

Let’s start with the months of inventory, or the absorption rate. I ran the numbers from MLSListings.com, our mls provider, this afternoon. The numbers below reflect all houses (or duet homes) in Saratoga, CA 95070. With months of inventory, the lower the figure the “hotter” the market or the more in the seller’s favor it is. Six months is said to be balanced. For Saratoga as a whole, there are 4.17 months of inventory or MOI right now. That’s not bad. It’s a seller’s market but not strongly so. But what if we look at subsets of the market? Let’s try it by price point.

We could drill this data down by any number of factors to see what the hyper local’s market climate would be like. The mix could include sale type (distressed properties, short sales, bank owned homes vs “regular sales”), various school districts, a “walk to town” location, horse properties, homes with views, newer construction, historic homes. etc.

Schools are always a big deal in terms of market drivers. Saratoga has 3 high school districts and 4 elementary school districts, and understanding those boundaries can make buyers a little crazy. Anyway let’s tease this out just a tad by looking at the MOI for Saratoga by high school district to see what we get.

• Homes feeding to the Los Gatos – Saratoga Joint Union High School District (Saratoga High) have 4.71 months of inventory (a bit cool but still in the seller’s favor)
• Houses which belong to the Campbell Union High School District (Prospect High School) have 3.71 months of inventory
• Properties in the attendance area of the Fremont Union High School District (Cupertino school, Lynbrook High School in Saratoga) enjoy 2.5 months of inventory (a pretty good, strong seller’s market)

Why such a big discrepancy, and why are homes in the Prospect High area selling so much better than those in the Saratoga High area? I believe that the answer has to do with the graph above – most of the homes in the Prospect and Lynbrook attendance areas are more affordable than those in the Saratoga High area, and as we know, the more expensive houses for sale in Saratoga are having some trouble selling. Unless we pulled these out by both school district and price point (and perhaps more factors, too), we can’t be sure but I think it’s the most likely cause.

Overall, though, we can see that in Saratoga right now it’s a whole lot easier to sell homes under $2,000,000 than over. Interestingly, it’s slightly easier to sell a home between $1 million and $2 million rather than lower than that. I believe that’s because homes under that price point are not in the highly prized Saratoga (or Cupertino) school area.

Right now, high end or luxury homes in Saratoga are difficult to sell. This will be more true if there are any “issues” (such as being too close to high voltage power lines or a noisy location). This may change. With the recent IPO of LinkedIn, there may be some newly minted millionaires who will not find the commute from Saratoga to be too far. They cannot buy just yet, but in a few months we may see an improvement in the market of these upper tier price levels. Watch this spot!

Luxury or estate home buyers: if you are looking to purchase a home upwards of $2,000,000, you might consider doing it before you are competing with Linked In money. Just a thought.

Next, let’s look at the most current REReport for Saratoga, using the closed sales from April. This month’s closed numbers will be available about 6-10 days into next month.

It has been a mixed bag in the Saratoga real estate market with both the median sales price and average sales price slipping until recently; pending sales were up, though, and closed sales were flat. Overall, it’s still a buyer’s market there. (Click on the link for a full report.)

Median List Prices of Saratoga Homes for Sale

First, a graph displaying the overview of the median list prices for condominiums and single family homes in Saratoga – all price quartiles combined:

In general, the seller’s market is showing itself for houses in the fact that list prices are rising. Not so with condo and townhouse pricing. That’s a much cooler market.

Next, the median list prices for single family homes with a breakdown by price quartile. (Please note that the info would be even more precise if broken down by school district, but this particular program doesn’t yet filter by schools.)

In most price points, the list prices are now rising slightly, but most of all in entry level homes. In the last few months we’ve seen the high end home sales start to pick up in Saratoga, with a good run up in late 2010 before sliding earlier. Starting to improve now, though.

And now, list price of condos by price quartiles.

Interestingly, the condo market is not enjoying at all the decent seller’s market seen among houses in this city. Every price point appears to be suffering, but the high end most of all.

Inventory of both houses & condos in Saratoga

It’s seasonally typical to have more inventory in summer than other times of the year. Going back a few more years (see below), please note where the peaks are found – always sometime in summer. (Single family homes only.)

It’s less clear, but still visible, with condominiums and townhouses in Saratoga:

Average Days on Market for Saratoga Homes for Sale

Houses by quartile is not much different – DOM was rising across all price points and has been since August until spring, when the bottom and two quartiles (blue and green) reversed the trend. These are the “hotter”or improving segments of the market right now.

It is strangely disjointed in the Saratoga Condo market, though. I can’t explain why this had been so “all over the board” based on just this data. But since August, all four groups appear to be following the same general trend.

My suspicion is that the homes with the better schools are faring the best, but that’s just a hunch based on how well homes usually sell – it’s not provable with this info at hand.

If you’re interested in buying or selling a Saratoga home, please contact me. I’ll be happy to meet with you for a no obligation initial consultation.

Saratoga Real Estate Listings – Saratoga Homes for Sale – Condos, Townhouses & Houses for Sale in Saratoga

If you’d like to browse Saratoga homes for sale, I invite you to have a look here! Below please find all properties currently listed as available on our local MLS. Please be advised that there are a number of different property types and school districts listed here. For more precise information on houses, condos or town houses on the market, please contact me via email or complete a form at SiliconValleyHomeHunt.com or on my popehandy.com website. Either way it will come to me and I will personally set up your search for a Saratoga property. (If you are moving to the South Bay area from far away, please also see my Silicon Valley relocation website for helpful tips.)

Showing properties 1 - 5 of 68. See more city of Saratoga real estate.
(all data current as of 2/10/2012)

1. $3,285,000 : 14982 Sobey Rd, Saratoga
   
   6 beds, 5 full, 1 part baths

   Home size: 4,895 sq ft

   Lot size: 1.04 ac
   
2. $915,000 : 18775 Mcfarland Av, Saratoga
   
   4 beds, 2 full baths

   Home size: 1,894 sq ft

   Lot size: 10,000 sq ft
   
3. $2,495,000 : 12888 Chiquita Ct, Saratoga
   
   4 beds, 3 full, 1 part baths

   Home size: 4,400 sq ft

   Lot size: 1.01 ac
   
4. $890,000 : 14451 Oak Pl, Saratoga
   
   2 beds, 2 full baths

   Home size: 913 sq ft

   Lot size: 8,925 sq ft
   
5. $625,000 : 14660 Big Basin Wy #C, Saratoga
   
   3 beds, 2 full baths

   Home size: 1,408 sq ft

   Lot size: 1,496 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

The exquisite Saratoga Oaks neighborhood is nestled between downtown Saratoga and the beautiful coastal foothills, close to the famed Hakone Gardens.  With both pools and tennis courts and a location just a block or so from tony Saratoga Village (click to see slide show), it is resort living in Silicon Valley at its finest. But this is not just a place for retirees who want to downsize, though they are also drawn here – families with kids also move to Saratoga Oaks to make use of the top rated schools

.

Which public schools serve this neighborhood?

Saratoga Oaks is within the very highly regarded Saratoga Union School District.  Although many other school districts in Santa Clara County assign children in homes to particular schools, Saratoga does not – it is an “open” school district. If there’s space and if the home is within the district, you may be able to chose which of the excellent Saratoga schools you wish for your student to attend. The nearest public school is Saratoga Elementary on Oak Street (API 958) but alternatively you may find enrollment instead at Foothill Elementary (API 943) or Argonaut (API 974).  The higher level schools are Redwood Middle School (API 972) and Saratoga High School (API 932).  All API scores listed here are from the 2010 County List of Schools. Additionally, there are two excellent private elementary schools nearby: Sacred Heart (Catholic) and St. Andrew’s (Episcopalian).

Where is Saratoga Oaks?

The Saratoga Oaks community is within the city of Saratoga, California, and is a part of Silicon Valley and what’s locally referred to as “the south bay” area.  It can be reached either via Springer Avenue, off of 4th Street in Saratoga or from Springer off of Big Basin Way (aka Hwy 9 or Congress Springs Road). This townhouse complex is literally where the town meets the hills – so it is not at all uncommon to find deer in the open spaces! Click on the map image to go to the live, interactable Google map.

What are the homes like in Saratoga Oaks?

Each residence is a townhouse, but size and condition of every property varies. In general, the layout inside is very good and “feels like” a house indoors rather than a townhouse. Most are two story units (there are a few single level homes) and many of them have the garage below the living areas since this is a hilly region. Most are close to 2,200 square feet in size (but it ranges from 1950 to over 2600 SF), with 2-3 bedrooms on average (though many include a sitting room as part of the master bedroom suite also).

Many of these homes have great views.  Some streets enjoy a higher elevation than others (Stoneridge is the highest) while others look out onto trees or other roofs, either of the two pools or the tennis courts. In general, homes here have a lot of windows – some models have glass floor to ceiling – to take full advantage of the vistas. This development was built between about 1973 and 1975.  So it’s not uncommon to find “popcorn ceilings”, original plumbing, single pane windows and other items which may need replacing. (If the furnace is original, it’s probably time to replace it.)

In some of the floorplans there are really large laundry rooms so many owners have moved the utilities to either a closet upstairs to to the garage and reclaimed the laundry room as a small office or computer room. Although this is not a “gated community”, Saratoga Oaks is quiet and there’s not a lot of traffic.  The noise that you might hear will likely come from exuberance at the pool or a vehicle on Big Basin Way.

Finally, these homes are located in a slightly hilly area, so some of the usual concerns around hillside homes apply here too. If you’d like to read more on this topic, please check out the following posts:

What To Consider When Buying a Hillside Home in Silicon Valley

Cracked Foundations, Adobe Clay Soils and Water in Silicon Valley

What does it cost to purchase a Saratoga Oaks Townhome?

Depending on the precise location (whether or not there’s a view, if it’s an end unit etc.), size, and condition of the townhouse, sales prices vary between the 700s to about 1.2 or more million. The Saratoga condo and townhouse real estate market is a cold buyer’s market right now, so it’s very tough for properties to push the upper limits of value at this time.

HOA Dues: I should add something that is sometimes a bit of a hidden cost, and that’s the home owner association dues, which are steep.  Because this communities has not just private roads and landscaping, but also tennis courts, two pools, beautiful oak trees to maintain, regular blanket insurance and also earthquake insurance, the amount of money paid to the HOA each month, if you include everything (insurance and dues) runs between $550/month to high 6s or more.  You could be paying $685 per month, in other words – larger units are charged more than the smaller ones.  If you see a very low (relatively) HOA fee, it probably is not including the required insurance fees, which are both “blanket” insurance and earthquake insurance for the complex. Head’s up on that.

In order to not miss any, I will include below all townhouses in Saratoga in this price range (displaying more than just Saratoga Oaks rather than missing any).  Sorry in advance for any confusion this may cause!

Showing properties 1 - 2 of 2. See more city of Saratoga real estate.
(all data current as of 2/10/2012)

1. $775,000 : 12630 Biarritz Ln, Saratoga
   
   3 beds, 3 full baths

   Home size: 1,991 sq ft

   Lot size: 3,192 sq ft
   
2. $948,000 : 14679 Springer Av, Saratoga
   
   2 beds, 2 full, 1 part baths

   Home size: 2,163 sq ft

   Lot size: 1,377 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Yesterday we looked at the types of home sales around Silicon Valley by price point.  Not terribly surprising, most of the short sales and bank owned homes were in the lowest price ranges.  Today we’ll look at this type of information not by pricing tier but instead by geography – in other words, by either town, city or district of San Jose (area).  This post will not cover every area but will be a sampling a few communities, mostly on the west side of the valley (since that’s primarily where I work).

By way of reminder, the small image to the left reflects Santa Clara County’s houses for sale as a whole – all areas and all price points. (You can see the full sized image by clicking on it.) The green area represents “regular home sales” and the brick red and light orange signify distressed  properties listed on the MLS for sale (red is short sales and orange is bank owned or REOs). Next let’s see a few regions within the county to see how things are faring geographically.

1. Almaden Valley area of San Jose – homes listed for sale by type – very few distressed properties on the market!

Almaden is a lovely southwest San Jose suburban community (zip code 95120) that grew up initially with the cinnabar or mercury mining activity.  Today it’s an upscale area of more expensive homes than most of the county, it enjoys really good schools and scenic views of the coastal range as well as the Santa Teresa Foothills.  Housing here is costly but residents love the quality of life. Since the cost of homes for sale here is high, it’s not super surprising, after seeing yesterday’s post, that there are very few distressed homes on the market here. Next we’ll check the other extreme….

2. Alum Rock area of San Jose – this is a less wealthy part of Santa Clara County and generally has been harder hit by the mortgage and housing crisis.

In this east San Jose neighborhood of Alum Rock (near beautiful Alum Rock Park), almost half the homes listed for sale are either short sales or bank owned properties.  That said, Alum Rock has some areas which are much more upscale (and elevated), some with many many acres of land and those pricier properties are not quite so badly hit with the distressed property deluge.

3. Cambrian area of San Jose – a west valley community that often closely reflects Santa Clara County as a whole

The Cambrian or Cambrian Park district of San Jose often has prices, days on market and other trends which are very similar to Santa Clara County so it’s often a good “gauge” of how the area is doing generally.  If you compare this graph to the one at the top of this post, you’ll find them very similar – about 2/3 of listed houses and duet homes for sale are “regular” or non-distressed sales.

5.  Campbell -a little more expensive, great downtown, popular area

Campbell is exceedingly popular as it’s got a charming downtown, enjoys light rail access and is part of the Los Gatos Creek Trail. It’s close to Los Gatos, but more affordable. Here about 70% of the homes listed for sale on our multiple listing service or MLS are regular sales, so a little healthier than most of Silicon Valley.

6. Los Gatos – a more expensive community, fewer distressed houses for sale

In Los Gatos, there are right now just 3 short sales on the market (for houses and duet homes) and NO bank owned homes. As you can see, it’s overwhelmingly “normal sales” and this helps a lot with home values.

A year or so ago, we had a cluster of short sales in one particular east Los Gatos neighborhood and it was really damaging the property values of the “regular sellers’” homes. It’s encouraging to see this correct a bit.

7. Monte Sereno – more expensive still – no distressed houses for sale right now!

Monte Sereno is a tiny city with 4,000 residents. It’s more expensive then neighboring Los Gatos, with whom it shares police, schools, library and more.

With no businesses or commercial buildings, Monte Sereno enjoys a quieter lifestyle.  Most of the activity is either around Daves Avenue School, the post office/city building or the horse trails!

8. Palo Alto -home to Stanford and classy luxury homes

Stately and vibrant Palo Alto is home to Stanford University (and the Lucille Packard Hospital, which is a world class facility).  Schools in this city are top-rated in Silicon Valley.  The city is beautiful and there’s lots to do.  For many reasons, then, Palo Alto is probably the most sought after address in the region, and home prices reflect its desireability. Not surprisingly, then, it’s not likely that home buyers will find many low-cost distressed properties on the market.  When they do appear, they tend to go fast.  As of this writing, there’s just one short sale and no bank owned homes available there.

9. Saratoga – great schools, scenic vista, highly regarded Silicon Valley community

Saratoga is not as costly as Palo Alto, but within Santa Clara County it’s right up there near the top for least affordable.

What I find most interesting here is not the small number of distressed properties on the MLS in Saratoga, but rather that there’s an equal number of short sales as there are REOs (bank owned).  Usually the ratio is more 2 – to – 1.  Maybe it’s a fluke? We’ll have to check and see down the road!

What we see when looking at Silicon Valley houses listed for sale by sale type is that the geographical differences largely mimic the pricing tiers.  The more expensive the area – or the home within it – the less likely you are to find that bargain priced property.

For more info on Silicon Valley Communities, please also see my website’s community information page.

A key ingredient in understanding how the Silicon Valley real estate market is faring is the ratio of regular sales to distressed properties on the market (Bank owned or REO listings and short sale listings). Today we’ll study Los Gatos and four areas or districts of San Jose: Almaden Valley, Willow Glen, Cambrian Park, and Blossom Valley.

First, let’s look at the county numbers as a general overview.  In all of Santa Clara County, there are 3537 houses, duet homes, condominiums & townhouses for sale and available (“status 1″ for my Realtor readers) on our multiple listing service. Of those, merely 1964 are “regular sales” (56%), 1105 are short sales (31%) and 375 are bank owned homes or REOs (11%).

Now let’s drill down to a few areas: Los Gatos, Almaden Valley, Willow Glen, Cambrian Park and Blossom Valley.  We’ll check out the ratio of regular sales of houses and condos in each of these areas.  How do these compare to the county average of 56%? Have a look:

This is helpful information for both home buyers & home sellers.  Home sellers need to understand the challenges that come with selling in an area with more short sales or REOs, if they are in one of those parts of the valley.  Or vice versa: if there are few distressed properties on the market, this makes it easier to sell (with less downward pressure on pricing).  Buyers need to appreciate that they will have better luck negotiating in areas where many homes are being sold under some pressure.

A quick disclaimer - if we narrowed this study by school district and even neighborhood school, we might find that these “general numbers” are actually quite different at the hyper-local level.  For example, if you visit a post of mine about the Los Gatos real estate market on my Live in Los Gatos blog, you’d find that when we separated out the various school districts, and even price points, the ratio of distressed properties and their absorption rates change very dramatically.  To see those, scroll down until you see the blue and yellow boxes.

The condo market in San Jose and nearby areas has taken a beating throughout our downturn.  Even so, condos in Los Gatos, Almaden and Willow Glen are faring pretty decently.

Now let’s hone in on each of these five areas and the two main housing types to see the ratio in each of regular sales, short sales, and REOs.
Los Gatos short sales, bank owned homes, and regular sales are next.  Green represents regular sales.  In most areas, it seems that there are about 3 times as many short sales as REOs – but not always. (Read more on the Los Gatos real estate market here.)

It is very dramatic – there are very few distressed houses for buyers to consider in Los Gatos right now: just 5 short sales and no REOs.  (The REOs do come on the market but are gobbled up quickly.)

What about condos for sale in Los Gatos?

This is still pretty healthy compared to most areas we’re considering today, but about 1/3 of the homes for sale are short sales or bank owned homes.

San Jose’s Almaden Valley is another pretty healthy market with relatively few distressed homes. Next I’ll post the graph for houses, then condos, in Almaden.

One of the driving factors for both Almaden and Los Gatos are the great schools. (More reading: check out the Almaden school district and school boundary maps & API scores for all of the Almaden Valley schools.)

Willow Glen, also part of the city of San Jose, is charming, convenient, has great community involvement – it’s always been a highly desirable place in which to live.  Next are the two graphs for Willow Glen houses and then Willow Glen condos:

Cambrian Park, also in San Jose and adjacent to all of the other areas we’re reviewing today, has become more prized over the years, first after highway 85 made it more accessible in the early 90s, and then again recently as the Union Schools began to trend up strongly in the API scores.  (Cambrian has 3 different elementary school districts, ranging from good to great. Read about the Cambrian Park real estate market in more detail here.) Most houses are still normal sales – making it a lot easier for home sellers than is the case for condo owners hoping to sell in the same neighborhoods.

Blossom Valley, yet another San Jose district, is burdened with the most distressed properties by ratio of any of these five places.  For home sellers in the 95123 and 95136 areas, it may well feel like an uphill battle to get a property sold and closed. With condominiums and townhouses especially, this is difficult for sellers there.

Earlier in this article, I gave a “quick disclaimer” about the hyper-local marke.  In Blossom Valley, Sakamoto Elementary School has fabulous API scores.  I have not pulled these numbers out, but I believe that because the school is an enormous draw, homes in that area are probably selling far better than the average in Blossom Valley (and distressed homes are probably selling far faster).

What to do with this information?  If you are buying in a part of Santa Clara County in which there are a lot of distressed homes for sale, you may get a great bargain right now. But be prepared because as more come onto the market, it may hurt your home’s market value.  Conversely, if you wish to purchase in an area with few distressed properties on the market, you may not be able to negotiate as much as you’d like – but those areas may be more insulated from further drops in value.

Downsizing? It may be a dream time for you to move from Los Gatos, Almaden Valley or Willow Glen to other areas where the market is softer.

Moving up?  That may be a little painful, especially if you’re going from an area with more short sales and REOs to another with fewer of them!

No matter what your situation, if you’re interested in buying or selling in any of these areas or nearby, please contact me for a private, confidential consultation.  I’m happy to meet with you and learn if we can work together to help you achieve your goals.

Lately I am seeing a trend with short sale listings which is anecdotal but, I think, significant.  More and more, I am seeing and hearing about lenders which are requiring an unrealistic sales price in order to approve short sales.  When I say “unrealistic”, I mean more than the market can bear in many cases.

I personally had this experience in recent months: I had a short sale listing in Sunnyvale which was priced at market value last summer.  We got three offers, all within 2-3% of each other.  This is a pretty good indicator of market value. (Had we been underpriced, the contracts would have come in higher.)  The bank wanted about 15% more – an absolutely unjustifiable figure.

What to do?  I ran the comps and submitted them.  No impact.  I then paid an agent to do a BPO (broker price opion).  That number came in about 1.5% more than my sales price.  The lender, in turn, ordered an appraisal (which we appreciated), and that came in another 1.5% higher than the BPO (or about 3% higher than the sales price my seller had accepted).  Common sense would dictate that the lender would accept as authoritative the appraisal price, right?  Not so.  They wanted another 1.5% higher still – higher than their own appraisal value, certainly higher than market value.  Needless to say, the buyer did not want to overpay for the property.  Fast forward a six months and the bank now has taken back that townhouse at foreclosure.  It could have been avoided had the lender been willing to be realistic.

As I speak to my colleagues in the real estate industry here in Silicon Valley, I am finding that my story with this one listing is not so unique. I see homes on the market in various west valley communities (Almaden, Cambrian, Los Gatos, Saratoga, Campbell and nearby San Jose areas) that are listed at a reasonable price and then speak with the Realtor and learn that the banks 10 to 15% more than the list price.  At best, this is at the high end of market value (but in many cases is higher still and completely crazy). The agents know that if the house is listed at the bank’s number, they’ll never even get an offer.

It looks as though many of the banks would rather just take the short sale properties back in foreclosure.  Why? There are incentives for them: they can write off losses, they don’t have to deal with second or third lein holders, and they may even have silent mortgage insurance, which doesn’t help if they accept a short sale – it only helps if there’s a foreclosure.

Some numbers:

Closed in the last month, just 26 short sale houses and condos and townhouses in Almaden, Cambrian, Los Gatos, Monte Sereno, Saratoga and Cupertino closed escrow.  In the same areas, there are 129 short sales on the market and available!   That’s 4.96 months of inventory….

Average days on market of these solds = 143   Average length of escrow for these solds = 110 (longest was 253!)

For non distressed listings in the same area it’s 555 available and 132 sold for 4.2 months of inventory.

The US government has tried to make short sales more appealing by offering cash incentives to lenders (and consumers), but it seems to me that right now, the banks are only appearing interested – they aren’t truly working to make short sales happen in many cases. This is not a good trend and it will hurt a lot of people.

The luxury homes market often behaves very differently than the rest of the real estate market as a whole.  If interest rates jump around, the impact is often far less since the home buyers of estate properties may not be nearly as dependent upon financing.  Many of these fine homes & estates are paid for “all cash”.  (In some cases they do this but later arrange financing, perhaps funding a “charitable remainder” trust rather than a more typical institutional loan.)

How’s the real estate market for high end homes in Los Gatos, Monte Sereno and the Los Gatos Mountain communities?  Defining “luxury homes” is a bit tricky because what constitutes luxury can vary from area to area (check out these estate homes for sale in the Buffalo NY area). For now let’s use prices of $2 million or greater as we first look at the Months of Inventory or Absorption Rate – though in fairness, the luxury price point is a little lower in the mountains.  (Six months is considered balanced by the National Association of Realtor, less is a sellers market and more is a buyers market.)

As of this writing (Jan 21, 2010) here are the numbers for homes over $2,000,000:

Los Gatos, 95030 for sale (active) = 20    Sold in the last month = 1  Months of inventory = 20

Los Gatos, 95032 for sale (active) = 14    Sold in the last month = 1  Months of inventory = 14

LG Mtns, 950303 for sale (active) = 2    Sold in the last month =0  Months of inventory = infinite

Monte Sereno   for sale (active) = 7    Sold in the last month = 0  Months of inventory = infinite

So right now, it is a deep buyers market in the luxury home strata in Monte Sereno, Los Gatos and the Los Gatos Mountains.

Next we’ll change gears and use Altos Research and quartiles to evaluate the most expensive listings.  We will look at the top quartile of list prices, the high end listings in Los Gatos (zip codes 95030 and 95032 in town), in the Los Gatos Mountains (unincorporated, 95033) and Monte Sereno (99.9% of which is in 95030 but a tiny sliver has the 95032 zip code).   The charts I’m using are live and will be continuously updated by Altos Research, to which I have a subscription.

List prices of homes for sale in the topmost price quartile in Los Gatos, Monte Sereno and the Los Gatos Mountains

The most expensive of these four areas is Monte Sereno.

Notice, for a moment, the “dip” in the last year in each area. For Monte Sereno, it came early, around April. For Los Gatos 95030 (the area closest to downtown), it came a bit later, in around June. For Los Gatos 95032 it was later still, and much milder, with the low point in about September. And the Los Gatos Mountains, which tend to move very slowly in the best of markets, had a gentle downward drop that appears to have hit bottom in November. It as if there had been a rolling wave…. Monte Sereno got hit, and then recovered, the fastest. The lower the prices, the gentler the fall and rise. Interesting!

Also of interest is that the list prices in the mountains and in Monte Sereno are as good as or better than a year ago, but not so in Los Gatos 95030 or Los Gatos 95032.

Average Days on Market for Los Gatos, Monte Sereno & the Los Gatos Mountains among the top tier of pricing in each

Over the course of the last year, it appears that homes were selling faster (or perhaps being yanked off the market faster) such that it was easier to sell last summer than it is today for luxury homes in these parts of Silicon Valley.

Let’s look at the patterns.  For the most part, these four areas all have a “V” type of movement with days on market. Visually, we again see dramatically different level of drop, though, almost exactly like we saw with the list prices. Monte Sereno sees a sharp drop – very low, very fast. Los Gatos 95030 is just behind it in terms of the type of falloff of DOM and then Los Gatos 95032 a little less. In the mountains, though, we don’t see a dramatic change at all. There’s a little dip, but nothing like what we see in Monte Sereno.

Inventory of the most expensive quartile of homes in Los Gatos, the Los Gatos Mountains and Monte Sereno

Again, we find that although these are four different (but adjacent) areas, all follow the same pattern for inventory, which was at a height last summer and is fairly low now. That seems to be somewhat seasonal, though. Let’s see how it looks over more time.

We can note that there are dips in inventory levels each winter. Even so, what we see more recently is a lot more dramatic – or volatile – than what we’ve seen prior to 2010.  Year over year, inventory is up – and that doesn’t help to sell a luxury property.

Luxury house buyers, this is a great opportunity for you to get the best home for the money!

Luxury home sellers, you need to be serious about selling if you want to be effective in this market.  There are lots of ways to get qualified traffic through the door, and just as many to make those same buyers not bother. It’s imperative to leverage everything you’ve got going for your property if you’re serious about selling.

View a Sampling Silicon Valley Luxury & Estate Homes Online Now!

Browse fine homes & estates listed for sale in Los Gatos

Showing properties 1 - 5 of 32. See more city of Los Gatos real estate.
(all data current as of 2/10/2012)

1. $19,995,000 : 16450 Aztec Ridge Dr, Los Gatos
   
   6 beds, 7 full, 2 part baths

   Home size: 11,257 sq ft

   Lot size: 50 sq ft
   
2. $8,995,000 : 18550 Black Rd, Los Gatos
   
   5 beds, 8 full baths

   Home size: 18,000 sq ft

   Lot size: 11.09 ac
   
3. $8,495,000 : Shannon Rd, Los Gatos
   
   6 beds, 7 full, 2 part baths

   Home size: 6,138 sq ft

   Lot size: 31.53 ac
   
4. $7,750,000 : 15215 Shannon Rd, Los Gatos
   
   5 beds, 5 full, 1 part baths

   Home size: 5,419 sq ft

   Lot size: 12 sq ft
   
5. $6,950,000 : 19730 Glen Una Dr, Los Gatos
   
   5 beds, 4 full, 1 part baths

   Home size: 5,461 sq ft

   Lot size: 2.80 ac
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Browse high end properties for sale in Monte Sereno

Showing properties 1 - 5 of 5. See more city of Monte Sereno real estate.
(all data current as of 2/10/2012)

1. $5,050,000 : 16036 Greenwood Rd, Monte Sereno
   
   7 beds, 7 full, 1 part baths

   Home size: 7,336 sq ft

   Lot size: 1.17 ac
   
2. $4,575,000 : 18325 Lexington Dr, Monte Sereno
   
   5 beds, 5 full, 1 part baths

   Home size: 4,640 sq ft

   Lot size: 43,560 sq ft
   
3. $3,899,999 : 15981 Grandview Av, Monte Sereno
   
   6 beds, 3 full, 1 part baths

   Home size: 5,300 sq ft

   Lot size: 43,560 sq ft
   
4. $3,298,000 : 18641 Withey Rd, Monte Sereno
   
   5 beds, 3 full, 1 part baths

   Home size: 5,744 sq ft

   Lot size: 1.71 ac
   
5. $2,595,000 : 16131 Viewfield Rd, Monte Sereno
   
   4 beds, 3 full, 2 part baths

   Home size: 4,890 sq ft

   Lot size: 18,837 sq ft
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Browse luxury houses for sale in the Los Gatos Mountains

Showing properties 1 - 2 of 2. See more city of Los Gatos Mtns real estate.
(all data current as of 2/10/2012)

1. $3,499,000 : 18807 Bear Creek Rd, Los Gatos Mtns
   
   2 beds, 2 full baths

   Home size: 1,440 sq ft

   Lot size: 2.65 ac
   
2. $3,499,000 : 18805 Bear Creek Rd, Los Gatos Mtns
   
   4 beds, 2 full baths

   Home size: 1,440 sq ft

   Lot size: 2.65 ac
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Browse estates and fine homes for sale in Saratoga, CA

Showing properties 1 - 5 of 34. See more city of Saratoga real estate.
(all data current as of 2/10/2012)

1. $17,500,000 : 22030 Mount Eden Rd, Saratoga
   
   6 beds, 6 full, 2 part baths

   Home size: 13,459 sq ft

   Lot size: 14.00 ac
   
2. $9,988,000 : 13388 Surrey Ln, Saratoga
   
   4 beds, 5 full, 1 part baths

   Home size: 8,500 sq ft

   Lot size: 1.05 ac
   
3. $6,900,000 : 19370 Saratoga Los Gatos Rd, Saratoga
   
   6 beds, 5 full, 3 part baths

   Home size: 6,570 sq ft

   Lot size: 4.47 ac
   
4. $6,000,000 : 15480 Peach Hill Rd, Saratoga
   
   3 beds, 3 full baths

   Home size: 2,789 sq ft

   Lot size: 7 sq ft
   
5. $5,500,000 : 19501 Rue De Glen Una, Saratoga
   
   5 beds, 6 full, 1 part baths

   Home size: 5,325 sq ft

   Lot size: 1.06 ac
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Please call or email me if you’d like assistance with buying or selling high end real estate in the west valley.  I’m happy to meet with you confidentially.

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!