Santa Clara County Real Estate Market Activity... HOT!
Santa Clara County Real Estate Market Activity...HOT!
The Santa Clara County real estate market activity continues to be very strong with escalating home prices and shrinking days on market (DOM) to sell the norm. A quick research of the past year's sales data from the MLSListings.com, the listing site for professional Realtors, indicates the fast downward trends for days on market that remind me of the peak seller market activity from 2005-2007... meaning the Santa Clara County real estate market is HOT!
One particularly active niche are the houses for sale in the $450-650K range. Some of my buyer clients are in this price range and are experiencing tremendous competition to secure a home, and with multiple offers the norm, they are unfortunately in the extreme category of activity so knowing the market is one key to successfully navigate through the real estate market place. One of my buyers competed against 30+ offers, another against 59 offers and yet another against 24 offers. When you consider that the most active price range is $400-600K followed by the $601-800K range, you soon realize that the average Silicon Valley buyer must understand this point to be seriously competitive.
Thinking of jumping into the real estate market? Take a peek and check out the current Santa Clara County real estate inventory here and see what is currently available.
Here is a graph indicating the strong "seller's market" trend. You want the truth? In a seller's market, the homes sell fast, the seller does not have to do much to entice buyers, there are multiple offers, and the seller can pretty much dictate the terms of the sale. Notice that the average pending non short sale/foreclosure home is selling in 17 days, a very low number of days with the nice updated homes selling in under one week so, needless to say, we are in a very seller’s market. It is one of the strongest seller markets since the last boom. And, the current average sold price is at 105+% of asking price, and the nice homes are going for well above that percentage. Last year was a strong seller's market and as you can see from the graph, the start of 2013 may be even stronger.
As a broker for the past 25 years, in my professional opinion, the primary saving grace for home buyers in the Santa Clara County real estate market, and it is HUGE if you are a buyer, is that interest rates at roughly 2% less then the peak market so buyers are actually saving money. If you bought the same $600K Santa Clara County house in 2007 with 20% down and with 5.5% interest rate versus 3.5% today, you could actually save $514.40 on your loan per month... per month!!! Granted this is a simplified view however that is a substantial amount of money for the average person trying to earn a living with a family. I would liken this market to early appreciation, not the peak. For those that are fearful of a bubble, this is still a big difference in comparing the two periods.
With this much activity here in Santa Clara County, it doesn't take a rocket scientist to realize the market is red hot. Opportunities still abound so what to do? Be a smart buyer. Do your homework. Have a clear purpose for your purchase, understand of the market dynamics, and have successful strategies can still lead to a productive... AND smart long term purchase. The jobs market locally is gaining ground. We still have a shortage of homes for sale. The affordable and most active price range of $400-600K I am talking about here will continue to be active for the time being so as of now, I am still bullish on purchasing a home as a long term buyer and can see cautious optimism for the next few years. barring a major catastrophe.
Santa Clara County Real Estate Market Activity is hot so know your market and reap the benefits today! Feel free to send me questions here or off line and I would love to see your feedback below.