With the Silicon Valley real estate market reaching for some balance, the fear is that leveling off will turn into a market crash. So far, we are not hearing of prices going down. Conversely, they appear to continue their upward march! But in Santa Clara County and San Jose now, we are not hearing so much about high numbers of bidders on properties. Some homes which might have gone under contract with multiple offers a few months ago quietly march past offer due dates with no bids presented. Even open houses seem quieter.
Some of what we are seeing is surely seasonal. Some has to do with rising interest rates. And some, predictably, from buyers tired of giving away their rights when dozens of competing offers vie for the same property. They are voting with their feet and waiting for more calm in the market.
But have sales slowed? This morning I turned to MLSListings.com and ran the “sale pending” or “under contract” dates for single family homes in Santa Clara County by week since the begging of June. I wasn’t sure what I’d find. Interestingly, the total of the 7 weeks shows home sales pretty consistent with what we had last year, even though inventory is tighter now. Have a look at the sale dates (pendings, not closings) for 2013, 2012 and 2011.
From this set of data, it appears that there is no cause for alarm – real estate sales seem to be at a healthy level despite what is happening with interest rates. Sales in 2013 took a little dip the week of July 4th for all three years. In 2013, it was a far bigger drop in sales the week after that, but those were more than compensated for the week after that.
Not tracked here, of course, are any of the other data points such as days to sell, sale price to list price ratio, or what happens if we tease out the real estate market by school districts, zip code, price point, etc. All of these areas, and many more, can make the real estate market conditions where you live (or where you want to buy) very different.
