Mountain View’s real estate market has cooled just a little more as compared to April, and April was cooler than March. Some of that can be seasonally normal, however, prices are down from 12 months ago. That is not seasonally normal at all.
- Prices are down month-over-month (appx 14-15%) and also year-over-year (just a little)
- Properties are selling quickly with 12 days on the market, however, this is up from last month’s 11 days on the market.
- The sales to list price ratio rose a tad to 116.5% of asking
Many home sales here are powered by the stock market, and most stocks are faring poorly now. At some point, this will impact what buyers can or will do, and prices should level off or decline at that point.
The Mountain View Real Estate Market
How’s the Mountain View CA real estate market? This is one of the hottest areas within Silicon Valley and is home to a myriad of high tech companies and is a stone’s throw from others. With a charming and walk-able downtown, easy access to CalTrain, and a vibrant atmosphere conducive to both work and play, it is no wonder that people relocating to the San Francisco Bay Area or Silicon Valley place Mountain View squarely in their target. (Also popular are adjacent municipalities: Sunnyvale, Cupertino, Los Altos, and Palo Alto.)
Overview of the city of Mountain View’s residential real estate market for houses:
First let’s have a look at the Real Estate Report with sales data taken directly from the MLS. These numbers for May are softer than they were for April (and April was softer than March). Last month the prices were still up year over year. In May, though, they are now off from the same time last year.
Trends at a Glance
|Trends At a Glance
|No. of Sales
|Sale vs. List Price
|Days on Market
|Days of Inventory
How can you tell if it’s really a buyer’s market or seller’s market? One important data point is the months or inventory, also known as the absorption rate.
The months of inventory (MOI) tells us how long it would take for the current inventory to be absorbed if sales continue at the same rate and no new inventory were to be added.
What is the months of inventory?
The best explanation given to me for the absorption rate uses the analogy of a bathtub draining. If the tub has water in it, and no new water is added, and the drain is opened (and drains at a constant rate), how long will it take for the water to all be eliminated?
So too with Silicon Valley homes for sale. How long would it take for the current supply to be bought up if no new listings came on the market? That’s the question. It can be days of inventory, weeks of inventory, or months of inventory – or any other chunk of time you want to use. My monthly Silicon Valley RE Report uses days of inventory, referenced via DOI in the chart below, where you can see that the average days of inventory for the county is 61, or about 2 months. A quick scan down that column will provide a sense of the market for each city and town.
The faster the absorption rate, the easier it is for sellers to sell and the harder it is for buyers to buy. In the U.S., about 5- 6 months of inventory is a balanced market. Here in Silicon Valley, balanced is probably closer to 4 months of inventory.
Readers of this blog know that I really like the multi year view of data, and I think with the months of inventory that’s also really helpful. Here’s the rate for Santa Clara County, single family homes, from January 2014 to May 2020 (needs a full month to be accurate).
For the month of may, the months of inventory was 2.2, which is significantly more than most of the last six years, and double the height of the market in 2017 and 2018. Translation: buyers, this is the best it’s been for you to buy in years. Yes there may be multiple offers – but if so, it is very likely to be much calmer than this time last year or at any other time for this same season in years.
It can be really challenging for people moving to Silicon Valley to get a sense of real estate prices, and perhaps more, comparing cost of from one town or district to another.
One question I get a lot is this: what does it cost to buy a 4 bedroom, 2 bath house of about 2000 square feet?
So to answer this question, let’s see what houses like this are selling for (4 bed, 2 bath, appx 2000 SF or 185 square meters) and see how the cost looks in one Santa Clara County / Silicon Valley area versus another.
Today I compared several areas and cities using this criteria: single family homes of 1800 – 2200 SF, 3-5 bedrooms, 2-3 bathrooms, on lot sizes of 6000 SF to 10,000 SF. Normally I would chart this over the last 2 months, or 60 days, but because of the low inventory causing the sellers market I have expanded the search to the last 3 months, or 90 days, for a better range. Because some areas have had a scarcity of inventory, I’ve added an addition to the chart titled NoS for Number of Sales within the given range.
Here’s how it shakes out in the “west valley areas” along the Highway 85 corridor, most of which are known to have good to great public schools. What areas are most affordable? One way of analyzing this is the “price per square foot” figure. Whenever I update the chart, I re-arrange the order of the cities from high to low based on the price per square foot, although there’s usually minimal movement.
Within this range, Campbell only had one sale over the last 90 days, so data for that segment may or may not be a good average. Both Los Altos and Saratoga had no sales within the last 90 days within these criteria, so their searches have been expanded to 0-180 days (or 6 months / half a year) and 0-120 days (or 4 months / a quarter year) respectively to provide data for comparison for this chart. Now that we have the data, let’s analyze it!
It’s a seller’s market in Silicon Valley right now. Many sellers are getting multiple offers and overbids, especially in Cupertino, Sunnyvale, Mountain View, Palo Alto and Menlo Park. For home owners trying to maximize their sales price, does it make sense to have an “offer deadline”?
If you are pretty confident that you can get multiple offers, the deadline helps in a few ways.
- it prevents the offer situation from being a mere “foot race” (fastest one wins, rather than highest offer and best terms)
- it allows everyone enough time to see the house, read the inspections, disclosures etc.
- it provides enough time for the sellers and agents to plan
As with all strategic plans, this one can backfire too. If you or your agent publishes an offer deadline and then no bids are forthcoming, it’s more than just a let down. It’s a market signal that this home is overvalued by its owner and agent. Then, suddenly, it can appear to be an old or stale listing, even if it’s just been on the market 7 to 10 days.
Many real estate agents take a middle path, saying nothing about offers until agents ask. If they are asked, they will give a date in the future – usually a couple of days after the open house. But the MLS won’t say it for these agents unless they hear many buyers’ agents asking about offer presentation. They don’t want to look bad, they don’t want your house to look bad.
We never know until a property goes on the market how it will fare. It is wise to be cautious about advertising an offer date unless you are very certain that you will be seeing multiples! The market right now is a little funny. Homes priced aggressively are getting multiple offers. Homes priced AT value are not moving quite so fast. And homes price for values in spring of 2018 are not selling well at all.
Delicious French food and great service are the order of the day at Le Petit Bistro in Mountain View. Recently, my extended family and I celebrated a milestone birthday there for one of the relatives. Apparently this is not uncommon, as we heard two other tables sing Happy Birthday to You during our time there, also.
The restaurant is comfortable, on the small side and the service is personal. We found that our needs were promptly addressed for water, more bread, ordering, or anything else that we might need, but it was done in a very friendly and unhurried manner.
A good sized selection of foods and preparation styles were offered: fish, pork, beef, lamb and vegetarian entrees were available. There was something for everyone. Between us, we enjoyed soups, salads and mussels for the first course. The main courses that we ordered included beautifully presented lamb chops, pepper steak, and pork medallions. At our table, we savored a variety of desserts, too: a fruit crepe (inside had fresh fruit and whipped cream), chocoloate mousse, and apple pie. All of it was absolutely delicious.
By all means, I would go back, and not just to celebrate a birthday. For that reason, I’m happy to write about it here – go give it a try, if you haven’t been already! You will not be disappointed.
Le Petite Bistro
1405 W El Camino Real, Mountain View, CA 94040
(As always, there is no compensation for my endorsement of this or any other business which I might write about from time to time. The folks at this eatery don’t even know that this article is being written, and of course it was my idea to write it, not theirs.)
A meeting will take place on Saturday, May 10th, 2014 at 10 a.m. at the Almaden Community Library ( 6445 Camden Ave, San Jose) to discuss the Guadalupe Landfilll’s “Gas Recovery Facility Relocation Project”. Currently there is in place such a system to recover the gas which is naturally emitted as the items in the landfill decompose. (Long timers in the area may recall problems at Shoreline in Mountain View when there were surprise combustion fires from the same sort of activity when the gas wasn’t being handled well.) This gas must be captured and dealt with one way or the other. But for various reasons, the powers that be at the landfill would like to shut down the current one and put a new one up in a different location, still at the landfill of course. Some locals are concerned about a variety of problems that may arise with this change. This landfill or dump is also known as the Guadalupe Recycling and Disposal Facility
For more info, please see the city’s website: http://www.sanjoseca.gov/index.aspx?NID=2434
The beautiful Beckwith Building in downtown Los Gatos, California
I have been fortunate to have made 5 trips to Europe, one of them lasting 9 months, and will be returning again before the end of 2013 (this time to Belgium). It is so diverse, beautiful and compelling! Having experienced a little culture shock myself (when living in Florence, Italy, for one year of university), I’m very sympathetic about how hard an international move can be, and I understand that for Europeans moving to Silicon Valley, there can be an acute culture shock, particularly for those coming from more rural areas.
The bulk of Silicon Valley is located in Santa Clara County, which is at the southern end of the San Francisco Bay. In this county, there are approximately 1.8 million people, almost a million of them in the city of San Jose. Some areas, or districts, of San Jose have a distinctive character and are almost like towns or small cities themselves. So in this article I’ll mention both cities and towns, but also areas or districts of San Jose, which might appeal to our European transplants. Most of my comments will reference Santa Clara County or “south bay” locations, but I will also mention others on the San Francisco Peninsula and SF Bay Area too.
Architecture, Urban Centers and Charm
It is an unfortunate negative in Silicon Valley that much of our housing consists of ranch style tract homes, and truthfully, they are not exactly a work of art. New or newer homes tend to be on very tiny parcels of land (or “lots”) and for many people may simply feel too congested or crowded. But there are beautiful residential neighborhoods – you just need to know where to look! In many ways, the areas with higher charm can make our global home buyers feel more comfortable than if they were faced with only track, ranch neighborhoods.
Do you value unique, older architecture with Victorian, Craftsman, Tudor or other home styles? Then check out these areas:
- Within San Jose: the Japantown, Vendome, and Naglee Park areas of downtown San Jose. Also in central San Jose are the Rosegarden, Shasta Hanchett and Burbank neighborhoods which all boast some lovely older homes. Or, if you love classic Spanish Revival style homes with views, consider the old Alum Rock area of San Jose near the country club (golf course). The Willow Glen area of SJ (zip code 95120) is full of lovely old established neighborhoods with historic homes and tree lined streets. If your job takes you to downtown San Jose, all of these areas will be fairly close.
Please read the rest of this article on the Move2SiliconValley.com website:
The other day I had a medical appointment in Mountain View near El Camino Hospital, and at the time I wasn’t initially so happy that the parking garage was filled up on the lower levels. To my surprise and delight, though, from the top of the structure was a lovely view of the coastal mountains with St. Francis High School in the foreground.
Mountain View, California (St. Francis High School)
When I think of the City of Mountain View, what comes to mind is often not mountains at all, but Moffett Field, Castro Street with its incredibly diverse restaurants and shops, lovely (and pricey) homes and of course some of the high tech giants that Silicon Valley is known for, such as Microsoft. Too often, though, I don’t really appreciate the proximity of the beautiful hills. On that day, though, they were unmistakably visible and beautiful.
City of Mountain View
Today let’s look at the Santa Clara County real estate market, the days on market (DOM) and the sale price to list price ratio for houses and duet homes (single family homes). This will primarily be graphs that I created using MLSListings.com (our local MLS, to which I am a paying member). We’ll consider the county as a whole and various cities or towns within it, plus areas of San Jose, as it has about a million residents.
First: Santa Clara County homes over the last year. Please note the decreasing days on market, the increasing sale price to list price ratio in recent months. This is exactly what an appreciating market looks like!
Santa Clara County average days on market and sale price to list price ratio
Next, let’s have a peek at how some of the hottest markets in Silicon Valley look, starting with Sunnyvale. It is odd to see any kind of a blip on the sale price to list price ratio. Are buyers giving some push-back? We keep hearing stories of homes selling 30% or more over list price with gobs of offers. So the SP – LP ratio change is a surprise.
Sunnyvale average days on market and sale price to list price ratio Sunnyvale
Palo Alto is always the hottest ticket in town. (more…)
Is it a good time to sell a home in Silicon Valley? One of the best ways to get a pulse on the real estate market is with the months of inventory (MOI), also known as the absorption rate. The way we calculate it is simple: find the current available inventory (not under contract or sale pending), then find the number of homes with that exact criteria which have closed escrow in the last 30 days. Divide the first by the second and you get the months of inventory.
Today I spent a little time on MLSListings.com, our local mls association (of which I am a member) and I ran the numbers for single family homes (houses and duet homes) in Cupertino, Los Altos, Los Gatos, Monte Sereno, Mountain View, Palo Alto, San Jose (all areas combined), Santa Clara, Saratoga, Sunnyvale and three of San Jose’s districts: Almaden, Cambrian, and Willow Glen. Below, please find the results of that study. (This is for single family homes of any price range or school district in each city or area named.)
Which are the hottest markets? They’re the ones with the smallest MOI – Mountain View is at .56 of a month (about 2 weeks), Sunnyvale at .66 month (about 2.5 – 3 weeks), Cupertino at .8 of a month, Palo Alto .81. All of these are very, very red hot seller’s markets. Every area, city or town studied was a hot market except for Monte Sereno, which at any given time has few listings and few sales plus a wide range of pricing, so often for this small city it’s best to look at the Los Gatos and Saratoga stats to see what’s really happening. A few very high priced listings may make the whole area look slow, when it fact it may be just a function of the pricing tier. (more…)