The Silicon Valley real estate market is a mixed bag and home buyers and sellers here may read the headlines and wonder why things seem so different in the news than in their own personal reality!
Here are a few quick facts and observations about the San Jose and Santa Clara County real estate market for houses, condos and townhouses:
- It is a seller’s market for both houses and condominiums in Santa Clara County (homes are selling well and very close to list price on average)
- The average and median sales price for houses & duet homes is down month over month and year over year (properties that are selling are those which are priced lower)
- For condos and townhomes, prices are up month over month (but down year over year). The condo market here has taken a huge beating in recent years.
- The market is not equally hot everywhere! It’s red hot in Palo Alto, Los Altos, Cupertino, and areas nearby (Santa Clara, Sunnyvale, Mountain View). It is also hot where there are low priced foreclosure houses which can be bought at bargain rates. The move-up market has been tough entry level houses in the best school areas are very sought after right now. (The market is decidedly cooler in Los Gatos and Almaden Valley.)
- Homes that are selling best are completely remodeled and have no “issues” (such as high voltage lines, poor floorplan, proximity to something undesirable etc.) and priced aggressively OR are distressed sales with great pricing
In the best areas, or those with the hottest markets, we are seeing some multiple offers with overbidding. At the same time, we are finding homes that look great but languish on the market due to some issue or another or pricing that’s not as competitive as it needs to be for today’s market (or both).
Sellers: if your home isn’t selling and it’s had good exposure, plenty of photos etc. and been on the market for a month or more, see if there’s an issue that you can fix or mitigate. Obviously you cannot move high voltage lines or a freeway, but if there are odors, clutter, or landscaping issues, it would be wise to fix them. That failing, to get your house sold it will probably require a significant price cut. The longer it’s been on the market without a price change, probably the deeper the adjustment will need to be.
Buyers: tired of losing out on multiple offers? That “perfect home” is the one that gets all the attention – but sometimes, just around the corner, there’s a property that with a little fixing could be just as sweet and that one can be purchased without so much competition or overbidding, so ultimately will cost you a lot less. Every other buyer wants what you want: a turnkey home that needs nothing (inside or out). But if you will push yourself a little and buy one which only needs one or two changes, you will find that your offer would be most welcome!
For instance, we know that right now (in these frugal times), many buyers do not want a pool – probably because of the ongoing maintenance costs. An in-ground pool can be filled for anywhere from $8000 to $20,000 or $25,000, depending on a lot of variables. If you want to buy a home with less competition, find the house with a pool and be willing to take on removing or filling it and re-landscaping. This is a fixable issue!
For more reading see:
A summary of tips for multiple offer situations in Silicon Valley real estate contracts
(links to multiple posts on various aspects of competing in multiples)