The article below is a snapshot in time for the Cambrian real estate market. Want to see what’s happening now? Please check this article for the current market conditions and absorption rate for Cambrian:
Cambrian Park is a district of San Jose which borders Los Gatos, Campbell, Almaden Valley and Willow Glen (the last two are also part of the city of San Jose). It’s got a population of about 77,000 between the two main zip codes, 95214 (about 45,000) and 95118 (about 32,000 residents). (There’s also a little sliver of 95008, but most of that area is covered by Campbell.) The 95124 area tends to be a little more expensive and a ittle less densely populated (7075 people per square mile in 95124 vs 7595 per sq. mile in 95118).
How’s the Cambrian real estate market? Right now, it is a strong seller’s market. This doesn’t mean that all homes are selling or that prices have returned to their peak, but in general, homes are selling briskly, much faster than a few months ago. As you can see from the Altos chart below, the average “days on market” has been falling over the last 90 days. It is interesting to note that in the last 90 days, the more expensive area of Cambrian (95124) is selling a bit better than the more affordable. This is a switch from the not so distant past, as you will see in the chart following this first one. (Charts below from Altos Research, to which I have a subscription.)
We can look back further and see that the market does seem to have changed in recent months from the trends of the last few years. The longer time frame below also visually accentuates the change in the DOM. (Please note that from about 2007 to 2008 the 95118 area was selling faster – then the two areas were in a dead heat – and now 95124 is selling quicker.)
Cambrian home buyers will tell you that homes are selling a lot faster than they used to, but also that prices are rising, especially among entry level priced homes. It is getting harder and harder, especially for first time home buyers, to get their foot in the door in Cambrian.
For those actively involved in the Cambrian Park real estate market, it’s no surprise that the sellers are now in the stronger position – especially if their homes are in good shape and well priced.
Perhaps the very best tool for understanding the realty market, though, is not a chart showing pricing or inventory or sales, but rather is the absorption rate. This number factors the available homes or inventory to those which have closed in a recent period of time (it can be by days, weeks or months).
Next we’ll focus on the Cambrian absorption rate, particularly the “months of inventory“. According to the National Association of Realtors, 6 months of inventory is a balanced market, less is a seller’s market and more is a buyer’s market. Today I ran the numbers from MLSListings.com using the sales recorded in the last 30 days to bring you current info on the Cambrian market and those are the figures we’ll use next. (“Sold” refers to homes which have closed escrow.)
For our MLS area 14, which corresponds to Cambrian Park, right now there are a mere 2 months of inventory for houses & duet homes. By itself, this means that it’s a strong seller’s market in Cambrian. That doesn’t tell the whole story, though. If we break it down to “type of sale” (regular, short sale, bank owned) we get even better information. Here’s how these categories line up for the absorption rates or months of inventory:
Absorption Rate of Cambrian Houses for Sale
Months of Inventory
|Bank Owned Homes||8/7||1.1|
As you can see, it’s twice as hard to get a “short sale listing” sold vs a regular sale type of property in Cambrian – regular sales are at 1.9 months of inventory while short sales are 3.8 months. But the hottest segment of the market is bank owned homes, which are flying off the market (thanks to their bargain basement prices) at 1.1 months of inventory.
Want even more info? Next, let’s look now at more of the info on listings and sales in Cambrian right now. Again, I ran these numbers earlier today from MLSListings.com (deemed reliable but not guaranteed).
Area 14 (primarily 95124 and 95118)
|Available – currently for sale (Status 1)
|(not under contract)||Short Sale||19|
|Pending with Release Clause (Status 2)||All||47|
|(short sale bank approval or||Short Sale||41|
|subject to sale of buyer’s home)||Bank Owned||0|
|Pending with Regular Contingencies (Status 3)||All||39|
|(regular buyer contingencies for||Short Sale||2|
|inspections, loan & appraisal)||Bank Owned||4|
|Pending with all Contingencies Removed (Status 4)||All||31|
|(should become a closed sale soon)||Short Sale||11|
|Sold & Closed (Status 5)||All||63|
|(within the last 30 days)||Short Sale||5|
*The numbers reported usually add up to the “all” figure, but not always as there are a couple more categories not displayed here (referring to court confirmation required or not required for probate sales).
Takeaways on the Cambrian Market today:
If you are a home buyer wishing to purchase a house in the Cambrian area of San Jose, be advised, then, that the competition will be extremely steep on bank owned homes for sale, and that they generally go fast! Conversely, the “softest” part of the market is short sales, so you may well get your best deal there – if you’re patient and can stand the wait. Even the softest part of the market is still a seller’s market, though. To have a good chance of success you need great financing (at least 20% down or smaller down but with a conventional – not FHA – loan). FHA home buyers are simply getting creamed in this market – they cannot compete unless they are willing to pay above market value for a home (and most are not).
Home sellers, this info should help you with pricing strategies too. If there are a lot of short sales or bank owned homes on the market near your property, it will pull values down and the bank owned sales, especially, will siphon off traffic you’d like to have come through your doors. But if your home is in an area with few of these properties, you should be seeing some recovery in pricing. If you get your home into top selling condition and price it aggressively, it should sell in well under a month’s time, possibly with multiple offers.
If you’re interested in buying or selling a home in Cambrian or anywhere in the “west valley”, please contact me today.