Silicon Valley Real Estate Info

Mary Pope-Handy 2018 photo wearing mask for smoke - same N95 mask can work for CoronavirusThis post on the coronavirus impact on real estate sales here in Silicon Valley is updated every few days, as things are changing every day or two, so please keep checking back often.

Coronavirus numbers in SCC continue to rise dramatically

As of right now, April 6, there are 1224  diagnosed cases in Santa Clara County per the county health department’s website. (Side note, the county has a new website with enhanced data, including reporting the number of hospitalizations and numbers of people in the ICU. I strongly encourage you to check it out.)  We need to see the number of new cases per day decline before we’ll see things approaching more of a normal. Hence the daily count posted. Right now, they are beginning to slow down. The daily increases are lower, which points to a flattening of the curve and the results desired. (The New York Times has an excellent article on cases by county throughout California.)

 

Santa Clara County coronavirus stats as of April 6 2020

 

Side note: You may want to pay attention to the number of cases when the Shelter in Place order was imposed, as we may need it to be less than that for the order to be lifted. Scientific American has a well written piece on what it will take to remove the restrictions. I found it useful.

Short answer about what is happening now: the real estate market is close to a full stop at the moment. A few homes are closing escrow, but fewer homes can sell or get through inspections / appraisals now. As of today, April 6th, a few restrictions have been lifted, but there are many challenges to buying or selling a home right now.  Full answer is below.

There are 3 stages now for us to consider when asking about the implications on real estate sales: the current Shelter in Place period, the period just after the Shelter in Place order has been lifted, and the long term after effects / changed reality. There are also multiple layers of restrictions that have been in play even apart from the Shelter in Place, such as a restriction on the number of people who could be in one area at the same time. When the Shelter in Place begins to lift, most likely some other restrictions will remain. It won’t be a black and white scenario, like the end of the school year. Expect nuances.

1 – During the Shelter in Place: Can real estate listings, showings, sales, and closings take place now?

The landscape for home sales is complicated and very restricted. My own opinion is that it may not be back to normal until June or July. Overall, no, it’s not broadly possible to show homes, making it tougher overall to sell them. There are a few caveats and exemptions, however.

Santa Clara County has had a Shelter in Place order for everyone since March 17 (and that order came one day earlier for those over 65 or with chronic health conditions).  Order of the Health Officer of the County of Santa Clara. Most of the other SF Bay Area and Santa Cruz County followed suit the next day.  Then the governor called for a lockdown for the whole state a few days after that (with no end date). Initially, real estate was not deemed essential, and therefore we Realtors were told that we could have no face to face appointments (and certainly no open houses).

Word "Update!"

And as of March 31, six Bay Area Counties came out with new guidelines on the concept of what is an essential business. They have loosened up the rules A LITTLE. Here is the new order:

https://www.sccgov.org/sites/phd/DiseaseInformation/novel-coronavirus/Pages/order-health-officer-033120.aspx

 
Specifically, under paragraph 13/f/x the revised order says:
 

x. Service providers that enable residential transactions (including rentals, leases, and home sales), including, but not limited to, real estate agents, escrow agents, notaries, and title companies, provided that appointments and other residential viewings must only occur virtually or, if a virtual viewing is not feasible, by appointment with no more than two visitors at a time residing within the same household or living unit and one individual showing the unit (except that in person visits are not allowed when the occupant is still residing in the residence);

To clarify, my company reached out to the county to make sure that we understood what was allowed. Only seeing vacant, non-occupied homes is permissible. That doesn’t mean that the seller lives there but steps out for a few minutes. It means the home is not being lived in at all. Further, the county relayed:

ADDED NOTE:  Nothing has changed from our original position that EVERYONE should be following the strictest interpretation of the Shelter in Place order.  The essential services re-classification has changed nothing about the restrictions on you. Showing a property should be done as a LAST RESORT.  You are expected to conduct business as you have for the past two weeks, which is in the safety of your home and all tasks and appointments should be done virtually.  

What’s new:

  • Real estate agents may show vacant homes only (not occupied homes) but this should be only after everything possible has been done virtually and as a “last resort” per the county
  • Real estate agents may show up to 2 people who currently live in the same household, no more

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The Santa Clara County real estate market slowed almost to a full stop as of the Shelter in Place order mid March. (If you haven’t read it, please check out my article on Coronavirus and Real Estate Sales.) Prices are up both month over month and year over year, but sales activity is down significantly, which is no surprise given the lockdown.

Until the market normalizes, which may not be until summer, it will be difficult to really assess the market. Below is the commentary on the stats we do have, but given all of the restrictions in place, it’s hard to know what it will be like when we emerge.

Right now, only vacant (non occupied) homes may be shown, and only up to two people at the same time who are residing in the same house. For those occupied properties for sale, it will be nearly impossible for them to be sold at this time, so next month’s stats are likely to be even less helpful. One day at a time!

Couple of quick charts that I created from the MLS first.

Here’s the multiple year over year view of inventory for single family homes in Santa Clara County. Inventory is low – much lower than all recent years except for 2018, which was a white hot market.

 

Inventory of Active Listings in SCC

 

Next, a visual for the days on market and the sale price to list price ratio. For this one, I did include April’s stats so far to give a possible sense of where the market may be going (and if that is correct, it seems to be softening some).

 

Graph - Santa Clara County days on market and sale price to list price ratio

 

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With our 300 sunny days per year in Silicon Valley (at least most years!), golf is a sport enjoyed year round here in the San Jose area.  Living near a golf course, or having a golf course view, is highly desirable as it provides scenic open space as well as convenience for avid golfers.

Silicon Valley Golf Homes, Silicon Valley Golf Properties

There are beautiful courses throughout the South Bay Area and it’s possible to find small condos with views of them at fairly affordable prices (Sunnyvale’s Sunken Gardens area is one of them).  Today, though, I want to provide a list of homes for sale near golf courses in the foothill areas of Silicon Valley.  Many of these will also be luxury homes. So the MLS list of these houses on the market which you can browse includes these areas:

San Jose areas including Evergreen & Silver Creek, Santa Teresa, Blossom Valley and Almaden; Los Gatos, Monte Sereno, Saratoga, Cupertino, and Los Altos.

There are golf courses to be found in other parts of Santa Clara County too (Mountain View, Sunnyvale, Santa Clara and more) – let me know if you are interested in these parts and I can send you a link for searching them for similar residential real estate.

Here are a available or recently sold homes near to golf clubs:

 

 

 

 

Circle with slash and words Blind offers

A blind real estate offer is a purchase contract which is written by a buyer when the property is sight unseen. There are commercial properties, such as apartment buildings, in which this is the norm, and it’s not surprising for multi-family units such as duplex to fourplex properties. It is uncommon with single units or homes.

Right now we are in the midst of a Shelter In Place order due to the coronavirus pandemic. Current restrictions do not permit the showing of homes, inspections, or appraisals – though the latter two may change or get adjusted somewhat as this order persists. If you want or even need to find a property, how can you do it with this restriction? It is not advisable, but some would-be home owners are writing blind real estate offers.

It makes sense for a multi-unit property to be sold this way because the investor cares most about the numbers. How’s the cash flow? Are the reserves good enough? When will the driveway need repaving? All of these items address the question of whether or not it’s a good investment, a good business decision.

Blind real estate offer on your own future home

Buying a home that you are going to live in needs to make sense financially, but you also need to like it. You need to see if the home has enough light, if the rooms feel crowded or spacious. You must learn if there are floors out of level or odors or other issues undetectable from a virtual tour or series of photos.

Before the broad Shelter In Place order, I showed a home in Gilroy, and one of my clients had an allergic reaction in the house. Maybe it was the new carpet? Who knows – but it was imperative that we visit the property in person.

Blind real estate offers are dangerous since they curtail the buyer’s ability to have properly vetted the property. They are also dangerous for the seller, who can get the house tied up with a buyer who may or may not be willing to go through with the sale once the home is finally seen in person. If the Shelter In Place order continues for 2 or 3 months, which Governor Newsom suggested yesterday, it’s possible that access by appraisers or real estate agents may not be permitted for a long time. Long escrows carry their own risks.

For all of these reasons, I do not suggest that homes be bought and sold  “subject to inspection“. Continue reading

The real estate market in the Los Gatos Mountains is very different from the “in town” Los Gatos housing market and really deserves its own separate treatment. The mountain area includes areas both in Santa Clara County and also Santa Cruz County. Both sides may have a Los Gatos mailing address with the 95033 zip code.

 

The Real Estate Report for the Los Gatos Mountains is updated each month and contains info for the area within Santa Clara County.

LG Mountains trends at a glance (link to the real estate report)

(If you are viewing this on a mobile device, the table below will scroll if you swipe it.)

 

Trends at a Glance

Trends At a Glance Feb 2020 Previous Month Year-over-Year
Median Price $1,087,500 (-13.7%) $1,260,000 $742,500 (+46.5%)
Average Price $1,260,000 (-9.7%) $1,395,460 $901,694 (+39.7%)
No. of Sales (-53.8%) 13 (-33.3%)
Pending 17 (+88.9%) 9 (+88.9%)
Active 25 (-3.8%) 26 30 (-16.7%)
Sale vs. List Price 96.3% (+0.1%) 96.2% 90.5% (+6.4%)
Days on Market 31 (-63.4%) 85 94 (-67.1%)
Days of Inventory 117 (+94.4%) 60 90 (+29.6%)

 

 

Sales are well up from last year, more than double what they were January 2019. As you can see from previous dates, the active inventory for Los Gatos Mountains is always significantly larger than the sales. That’s not common for communities in the valley, and makes it a calmer market for buyers. That being said, the gap seems to be growing smaller this year and the mountain market is more active than it was a year ago.

Each week, my subscription to the Altos Research Report for the Los Gatos Mountains is automatically updated. Click on the link to view it, or subscribe if you’d like an update emailed to you regularly.

As of the most recent update (2/18/2020 at the time of this writing) this market shows signs of some warming. In December, Altos reported that this market was in a slight buyer’s advantage, but now we’ve returned to a slight seller’s advantage again as market activity increases.

 

 

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Choosing Vendors when Buying and Selling Homes in Silicon ValleyRecently a friend asked me about the way in which vendors are selected when people buy and sell homes.  In some cases, Silicon Valley home buyers or home sellers know which title company, home inspector, home warranty provider or other vendor to hire.  Most of the time, though, they don’t. They are hoping that we real estate professionals can put them into contact with good providers to ease the task of choosing vendors.

Trusted Vendors

When working with my clients, for most vendors I provide a trusted  list of sorts.  For the various inspections (roof, chimney, home, pest, etc.) or other service (lender, home warranty, title company) there might be as few as two or as many as six resources listed.  Most often, my clients ask me if I have one or more which I prefer, and most of the time it is one company for each category (I have a favorite termite company, favorite home warranty company, etc.).

The home buyer or seller in Santa Clara can pick or hire anyone or any company he or she pleases for these various jobs. We agents can and will assist with sharing the names and numbers of those whom we know, like and trust, but at the end of the day, it’s the client who chooses. So really it’s up to the client – he or she can do some research or not.  But if they tell me (as they most often do) to go with my preferred vendor, there’s one in each category and I don’t tend to “spread the business around”.  Over the years, agents tend to build relationships with people in these companies and get a sense of whom they can trust and want to work with. (We agents would hate it if a client with six homes to sell picked six different Realtors to rotate through, too. We tend to want and also to give loyalty.)

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The Monte Sereno real estate market is similar to Los Gatos, but distinct - Monte Sereno shares many features with Los Gatos but is a distinct cityHow is the Monte Sereno real estate market? Because the city is small, with just about 4,000 residents, there usually are few homes listed for sale or selling, and with small numbers we can get seeming volatility.

There are no condominiums or townhomes in Monte Sereno at present (we are watching closely the proposed development at La Rinconada, which is unincorporated as of this writing). One of the major challenges for this city is to ensure that at least some housing units are deemed “affordable.” You can find the city’s housing plan here (a pdf online):  http://www.montesereno.org/DocumentCenter/Home/View/674

Below is a quick market profile for Monte Sereno. This is updated automatically weekly, so please check back often.

 

Monte Sereno Altos Real-Time Market Profile

 

As of the latest update, March 10, 2020, the Monte Sereno market is in a slight seller’s advantage.

Altos Research does weekly reports, to which I subscribe. You can see the full weekly report for Monte Sereno HERE and you can click the subscribe button there if you’d like to get it weekly (or navigate to another zip code or city and subscribe to that). Here’s the data on home descriptions per price quartile in the report, updated automatically throughout the month:

 

Median List Price for Monte Sereno By Altos

 

It looks like prices are rising right now in all but the lowest price tier! Remember, there’s less inventory in winter usually, and fewer sales mean greater swings in data.

 

Stats for recently closed home sales in Monte Sereno

Here are the quick statistics for the closed sales in the last complete month to give a sense of how things are going with the Monte Sereno real estate market. Sales data comes from my Monte Sereno Real Estate Report. Given that the supply of homes to study is tiny, what can we tell from this data?

It’s true that an average Monte Sereno house is about $2.5-3.5 million, and often higher in the current market – a little steep for most folks!

Monte Sereno Real Estate Market Trends at a Glance:

Just 2 sales in February makes this not a statistically useful pool of data. Looking back a year, however, it’s at least keeping up with last year’s market!

 

Trends At a Glance Feb 2020 Previous Month Year-over-Year
Median Price $1,828,000 (-16.9%) $2,200,000 $2,675,000 (-31.7%)
Average Price $1,828,000 (-16.9%) $2,200,000 $2,675,000 (-31.7%)
No. of Sales (+100.0%) 1 (0.0%)
Pending (-100.0%) 1 (N/A)
Active (+60.0%) 5 (+33.3%)
Sale vs. List Price 105.9% (+8.3%) 97.8% 97.3% (+8.8%)
Days on Market 32 (+540.0%) 5 (+300.0%)
Days of Inventory 112 (-25.3%) 150 81 (+38.3%)

 

And the month before:

 

Trends At a Glance Jan 2020 Previous Month Year-over-Year
Median Price $2,200,000 (-6.9%) $2,362,500 $0 (N/A)
Average Price $2,200,000 (-33.4%) $3,301,250 $0 (N/A)
No. of Sales (-75.0%) 4 (N/A)
Pending (0.0%) 1 (0.0%)
Active (0.0%) 5 (+66.7%)
Sale vs. List Price 97.8% (-2.1%) 99.9% 0.0% (N/A)
Days on Market (-77.0%) 22 (N/A)
Days of Inventory 150 (+300.0%) 38 (N/A)

 

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Mary Pope-Handy

Realtor
ABR, CIPS, CRS, SRES
Sereno Group Real Estate
214 Los Gatos-Saratoga Rd
Los Gatos, CA 95030
408 204-7673
Mary (at) PopeHandy.com
License# 01153805


Selling homes in
Silicon Valley:
Santa Clara County,
San Mateo County, and
Santa Cruz County.
:
Special focus on:
San Jose, Los Gatos,
Saratoga, Campbell,
Almaden Valley,
Cambrian Park.

Mary’s other resources

Silicon Valley real estate report
Real estate statistics and trends for Santa Clara County, San Mateo County, and Santa Cruz County

Live in Los Gatos blog
Los Gatos neighborhoods, history, businessses, parks, restaurant reviews, and more

Valley Of Heart's Delight
Santa Clara County Real Estate,
with an interest in history

Move2SiliconValley.com
Silicon Valley relocation info

popehandy.com
Silicon Valley real estate,
focus on home selling

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