A Berkshire Hathaway Affiliate
Buy.Sell.Stay. January 2016 Market Report Mid Peninsula Atherton, Los Altos, Los Altos Hills, Menlo Park, Palo Alto, Woodside
2016 Intero Real Estate Services Inc., a Berkshire Hathaway affiliate and a wholly owned subsidiary of HomeServices of America, Inc. All rights reserved. Data provided by Trendgraphix February 2016. All information deemed reliable but not guaranteed. This is not intended as a solicitation if you are listed with another broker.
Executive Insights Introducing Intero Real Estate’s January 2016 Mid Peninsula Market Report It’s just the beginning of 2016, the year is new, there are endless possibilities, and we predict the future to be promising! At least that’s how Tom Tognoli, President & CEO of Intero Real Estate Services, Inc. feels. “I know the financial markets have been a bit rocky the last few months, but when you step back and look at the fundamentals of the Bay Area real estate market, it’s strong! Companies like Apple, LinkedIn, Netflix, Facebook, and Google are flush with massive amounts of cash, they are acquiring land and buildings to add more employees, and interest rates are still at ridiculous low levels. Combine that with the Bay Area being one of the nicest places on the planet to live and it makes me optimistic!” As January rounds out the holiday season, this year we found the Bay Area market started on a somewhat slow note – which was to be expected. As families celebrated the holidays, participated in numerous local Super Bowl events, and endured El Niño, housing sales slowed down. All of which is to be expected at this time of year. So as the weather becomes warmer and the flowers begin to bloom a natural increase in activity should present itself. Overall, we’re seeing the market to be slightly in favor of sellers. Inventory throughout the Bay Area has been somewhat low, giving buyers less to choose from and sellers more flexibility with higher prices. This can be largely attributed to the massive job growth throughout the area. California Association of Realtors (C.A.R.) projected statewide job growth to be 2.3% in California this year, creating the lowest unemployment rate we’ve seen over the past 5 years. To put it simply, more jobs means more people need houses, so as the year progresses, we will see more homes being built to accommodate new jobs, and more homes being put on the market. C.A.R. Vice President and Chief Economist Leslie Appleton Young echoes these sentiments, and provides a detailed outlook: “The foundation for California’s housing market remains strong, with moderating home prices, signs of credit easing, and the state continuing to lead the nation in economic and job growth,” she stated. “However, the global economic slowdown, financial market volatility, and the anticipation of higher interest rates are some of the challenges that may have an adverse impact on the market’s momentum in 2016. Additionally, as we see more sales shift to inland regions of the state, the changes in mix of sales will keep increases in the statewide median price tempered.” Okay – that may have been a little bit much and sounded a little confusing, we know. That’s why we’ve taken a much closer look, and broken it down into bite sized, easy to understand pieces for you. The market changes in meaningful ways each month, and we want to make sure that you’re always provided with the most accurate and up to date information possible so you’re always well informed. If you want to buy, sell, or just get a general sense of your neighborhood, this report has you covered.
Market Highlights Mid Peninsula
Total Homes for Sale
95
Luxury Homes for Sale*
57
*Homes for sale above $3 million.
Total Homes Sold
Average Days on Market
Average List Price
Average Sold Price
38
$6,311,000
38
$2,570,000
Inventory Mid Peninsula
Total Number Of Homes:
For Sale 200
200
68
38
46
40
79
82 68
77 66
60
95
92
99
116
124
130
150
145 131
130
86
100 97
80
105
120
108
138
140
151 138
166
160
158
185
180
100
Sold
20 0
14-Nov
14-Dec
15-Jan
15-Feb
15-Mar
15-Apr
15-May
15-Jun
15-Jul
15-Aug
15-Sep
15-Oct
15-Nov
15-Dec
16-Jan
Inventory Insights Like December, January’s market leaned in favor of sellers. Total property sales in January continued to lag slightly behind the number of sales this time last year and the previous month, but that’s pretty normal with seasonal factors taken into consideration. The holiday season is historically slower than the rest of the year when it comes to home sales; families want to spend time together undisturbed, the weather is less than ideal, people travel, large events like the Super Bowl happen – you get the picture.
Inventory By The Numbers Home Price Range
Homes For Sale
Year Over Year % Difference
< $500K
0
N/A
The total number of homes available for sale in January marginally increased compared to last year, and similarly compared to this time last month. This smaller inventory means that buyers who have been waiting to buy will have fewer homes to choose from, which is great news for sellers! As winter passes and spring begins, we’ll begin to see more homes on the market accompanied by more sales.
$500K $1M
5
400.00%
$1M - $3M
33
6.50%
In the luxury market, however, buyers had the upper hand – but not by much.
$3M - $5M
17
-37.00%
The total number of luxury homes available in January was slightly higher than this time last year as well as this time the previous month. Still, even the smallest increase in available homes gives buyers more variety to choose from.
$5M - $10M
23
64.30%
$10M +
18
38.50%
Similar to the non-luxury market, this advantageous time for buyers can be primarily attributed to the natural seasonal market pattern. Buyers should take notice, though, because as the year progresses and the seasons change, the market will change, too!
Pricing Mid Peninsula
Average Prices in $,000:
For Sale Price
Sold Price
8000
$7,490
7000 $6,148
$5,996 $6,096
6000
$6,039
$5,781 $5,716
$5,832
$6,221 $6,183 $5,694
$5,892
$6,311
$6,202
$5,187
5000 4000 3000 $2,858
$3,206
$3,596 $3,171
$3,374 $3,285 $3,210
$3,526 $3,072 $3,123
$3,350
$3,045
$3,340
$2,975 $2,570
2000 1000 0 14-Nov
14-Dec
15-Jan
15-Feb
15-Mar
15-Apr
15-May
15-Jun
15-Jul
15-Aug
15-Sep
15-Oct
15-Nov
15-Dec
16-Jan
Pricing Insights The average “For Sale” price in January was $6,311,000; the difference is pretty negligible compared to both last year and the previous month with a slight ebb and flow from both higher and lower prices. The average “Sold” price saw a significant decrease from both last year and the previous month at $2,570,000, making January a great month for buyers. That’s a pretty large difference between the average listing price and the average sold price, showing that low demand and the power of negotiation can be monumental in home sales. Since we are still getting over the fervor of winter and the holidays, it seems that demand has yet to catch up with supply. As the year progresses, however, demand will continue to grow, leading to more competitive pricing. So, sellers, don’t worry – your time is coming soon!
Pricing By The Numbers
Average Price Per Square Foot.
$1,209 9.5%
Month over Month
On The Market Mid Peninsula
Average Days On Market
45
41 38
40 34
35
34
30 25
23
22
23 18
20
19
21
22
22
22
19 16
15 10 5 0 14-Nov
14-Dec
15-Jan
15-Feb
15-Mar
15-Apr
15-May
15-Jun
15-Jul
15-Aug
15-Sep
15-Oct
15-Nov
15-Dec
16-Jan
Days on Market Insights The Days on Market (DOM) shows, on average, how long properties are on the market before they sell. The amount of time it takes a house to sell can help us determine whether buyers or sellers are having a more favorable month. This Januaryâ&#x20AC;&#x2122;s DOM was 38 days, just a few days longer than the previous month and a few days shorter than last year. In this sense, it was a great month for buyers; the longer a house is on the market, the more likely it is that there will be room for negotiation, and lowered prices. Sellers should not be discouraged, though! Itâ&#x20AC;&#x2122;s quite common for a house to be on the market for at least a month. And again, demand will continue to grow, eventually causing competitive bidding and much faster sales. Stay tuned, sellers!
DOM By The Numbers Home Price Range
Days on Market
Year Over Year % Difference
< $500K
0
N/A
$500K $1M
68
71%
$1M - $3M
24
-42%
$3M - $5M
69
70%
$5M - $10M
0
N/A
$10M +
0
N/A