The train keeps a-rollin’, with the median home price in Santa Clara County up almost 20 percent from August 2016, and in San Mateo County up a paltry 10 percent, according to the latest California Association of REALTORS data.
Statewide, the median price shot up 7.2 percent year over year, close to the performance Silicon Valley turns in in a “normal” year, while the Bay Area rose 6.5 percent.
To put those percent increases in perspective, in August 2016 the median San Mateo County home price was $1,250,000. This August it was $1,375,000. The numbers for Santa Clara County are $975k and $1.150M.
At $863/sq. ft., San Mateo County ranks second in the state in sales price per square foot (behind San Francisco), with Santa Clara third at $668/sq. ft.
The tempo of local real estate also increased significantly, with San Mateo County homes selling in an average of 11 days last month, compared to 14 days in August of last year. Santa Clara County accelerated even faster, from 15 to 10 days. Blink and you’ll miss them.
Inventory declined sharply year to year. San Mateo County had two months of unsold inventory in August 2016, itself a very low number, but only 1.7 months last month. Santa Clara County declined even more precipitously, from 2.4 months of inventory to 1.5.
But hey! it’s not all doom and gloom for home buyers. Median prices in the two counties actually declined from July to August 2017, a trend that doesn’t show in the statistics I use in my monthly newsletter. This suggests that either CAR and I use different methodology, probably in defining date of sale (contract date or close date?) or that the market stayed strong in the core Silicon Valley cities and neighborhoods I cover, while softening elsewhere in the two counties. Anecdotal evidence suggests the latter, proving for the umpteenth time since 1998 that Valley real estate marches to its own drummer.
Any lessons here? First, that “I’m waiting for the market to cool down” is a chancy proposition. Even the people who chant “this can’t last” must be having secret doubts.
Second, that a month does not a market make. Are the declines in CAR’s median price last month the beginning of the end of this boom, or just a seasonal glitch? Did it affect the neighborhoods everyone wants, or just the neighborhoods that are everyone’s Plan B?
Late last year the market did cool down, for several months, then re-ignited in January. Did the market timers jump in last November when the getting was good, or did they feel safer standing on the sidelines waiting for more certainty and perhaps even a full-on buyer’s market?
Meanwhile, where it really matters–year over year–the train keeps a-rollin’.
copyright © John Fyten 2017