Are home prices dropping in San Jose? The Bay Area housing market is cooling all over.
- Overall, yes, we have home prices dropping in San Jose month over month.
- As of now, home prices are not down year over year for the city generally.
- in some areas, price points, or select segments, year over year prices could be up or down as compared to a year ago
- in part of the market, the year over year number is flickering back and forth (see the $2 million pricing band, below)
Let’s see what the data says. I pulled this from MLS Listings just now for all of the city.
In what price points do we see home prices dropping in San Jose?
If we look at all San Jose single family homes (mostly houses, but a few duet homes), we can see that prices were higher in April 2022 than they are now. In general, values have been falling month over month since April’s peak.
We also note that prices do not only go up, that there are many movements up and down over the course of a few years. The first question we should ask is if this is seasonally normal or not. From the graph below, it appears clear that while home values do rise and fall seasonally, this is a larger drop than is typical, and it’s both faster and steeper. Please also see Seasonal Pricing Patterns on this site.
This is a lot of sales over the years – 30,691 in all.
If we view this same info in a data table of average sale prices, we can better compare any particular month to the same month in other years. This eliminates the normal seasonal fluctuation.
The peak pricing was April 2022. The average sale price for July 2022 remains above July 2021 and all previous Julys. In 2018 prices got a bump and went down in 2019, but marched upward again after that.
Are home prices dropping in San Jose in ALL price points?
- In the lowest priced houses that sell for $1 million or less, values are down slightly year over year.
- More than half of all single family homes sold between $1 million and $1,999,999, and in that price range prices are up a little year over year: in general, we are not seeing home prices dropping in San Jose (year over year) in this price range.
- For high end houses between $2 million and $2,999,999, this month prices are up compared to last year, but the average sale price has been hovering above and below last year’s prices all year – flickering back and forth.
- The luxury tier over $3 million does not consist of many homes, and therefore may be statistically questionable, but the average sale price is over where it was a year ago. Interestingly, though, it’s a bit below where it was for July 2018. What we don’t know is if the price per SF varies, or if the size of the homes purchased are larger or smaller.
Lowest priced houses in SJ
Here’s a look at the average sale prices in San Jose for the lowest priced houses sold under $1 million. Again, this is for all of San Jose. The results could change if we were studying only one area or another, such as Evergreen versus Berryessa or anyplace else. We can see home prices dropping in San Jose toward the far right of the graph. Harder is knowing how it compares to 12 months ago.
Visually, it’s interesting to see how fairly “flat” it is – we don’t have the same sort of peaks and valleys found in all price points combined! We should also note it’s less 10,000 sales, so less than 1/3 of the total in the data set for the whole city.
Next, the data table for the same info. For this part of the housing market, sale prices are down year over year a little bit in July. The peak was almost a perfect tie between March and April.
Also interesting to see is from 2017 to now, sales have mostly been somewhere in the 800s. Hence the graph looking more flat for these price points as compared to others!
Sold homes between $1 million and $1,999,999
The next group is between $1 million and $1,999,999. There are many first time home buyers purchasing in this range. It’s also more than 50% of all San Jose sales (18,642 out of 30,691 total).
Same info, but in a data table: . The peak was in March but May was a close second and April not far behind – kind of a Spring plateau, almost.
Higher priced homes between $2 million and $2,999,000
Next, the question of whether are not home prices are dropping in San Jose between $2 million and $2,999,000. Most of San Jose is not this pricey, so it’s a tiny group of sales.
This set looks quite different than most of San Jose, but it’s also a small pool of just 2599 listings.
I added a plus or minus between the 2021 and 2022 columns to indicate if 2022 is above or below the 2021 prices. It’s literally flickering back and forth, oddly enough. It does look like home prices are dropping in San Jose – or fighting to keep an equilibrium with last year. Many real estate commentators refer to the market as flattening out. That’s what this tier appears to be doing.
The few high end sales over $3 million in SJ
Far less reliable are the San Jose homes sold over 3 million. There are hardly any, just 417 sales, so please take this info with a big grain of salt. That said, it looks like there was a big burst of sales over this price point in 2018.
And the same info in a data table:
How do consumers feel about home prices dropping in San Jose?
Many residents who aren’t currently homeowners wish that real estate prices would crash so that it would be easier to buy a house or condo.
When we se home prices dropping in San Jose, instead of jumping on it, many would be home buyers hold off – hoping that the price cuts will go deeper. In 2019 we had a little pullback. Some buyers plunged ahead. Others waited and hoped that values would drop. Instead, Covid hit and we had steep appreciation in prices.
It’s almost impossible to perfectly time the market, whether we are talking about home prices, interest rates, or the stock market.
What we do know is that interest rates have recently gone down a little, the stock market has gone up a little, and unemployment is generally low. It’s the easiest time to buy a home since Covid started. In some price tiers, and in some areas, home prices are dropping in San Jose and that may be a short lived gift. I would not advise buyers to wait for lower prices or lower interest rates since we don’t know if they are coming or not.
For home sellers who are frustrated to have missed the peak of the market, now is not so bad. Most homes are still selling over list price and in under a month. That is a great situation for home owners wanting to sell!
Want to check other areas? Please visit our RE Report and click on the link near the top where it says CHANGE and then select the district of San Jose that interests you. This link will take you to the RE Report for San Jose as a whole
