Realty One Group
Silicon Valley, CA
The area is as vibrant as ever. In 2019 there has been several ipos in the works. Lyft, Uber, Printest not to mention Levi Strauss just outside the area there are already lots happy stock optioners become instant multi-millionaires.
Our craze on overbidding for the last few years seemed to run out of steam. Like the rest of country since late spring in 2018, with stock volatility people are more cautious not to overreact. Once 30 offers are reduced to a handful, the sold/asked ratio reduces exponentially to full price. After a less active winter it started seeing life again with homes sold fairly quickly. In Silicon Valley the sellers still call the shots. Very rarely I see a price lower than asked is accepted. As the last 40 years here concession is not a commonly used term as there are still more buyers than sellers.
Figure 1 Sold/asked ratio for SFH SJC
The days to market a home has been normalized. Gone are the 1 weekend 20 offers sales. Agents have to spend every week market, do open house like other cities in the US cities. 38 days was the average time to get an offer accepted by the often disappointing seller at 2018 year end. It is the market not the agent that changed the pace.
Figure 2 Marketing time for Silicon Valley(SJC)
Home prices maxed out in May of 2018 at $1,266,000 (average price for a tract home). At the end of 2018 home sellers saw -17% price drop in a few months. This trend follows most of SFBA and other urban cities as well. The more desirable neighborhood and larger homes experienced more price erosion. In March we saw some regroup and possibly more active market. It really is determined by the local economy and whether there are more high tech hiring from out of town. The ipos could precipitate higher interest in estates ourchase north west of Silicon Valley to the Peninsula through San Mateo into San Francisco. Silicon Valley consists mostly brick motar tract homes.
Figure 3 Average home sold price (1300-2000 sf SFH), SJC
I want to mention that condos, town homes are currently out of fashion. Sellers no longer can get previous stellar prices as potential home owners flock to make offers on the single family homes. A few home sellers made price adjustment(S) to get the deal closed. Last year I saw 10 offers made often way over asked price. Lately, it is just a few interested people often do not have the sufficient downpayments. Sellers want to control the price and do not take concession as before. This is Silicon Valley, N California.
The inventory currently stays between 2-2.5 months which is fairly healthy for Silicon Valley. Previous it was as low as 0.5-.8 month resulted in more sales than the supply. For this area 2 month or higher is very much a neutral (not seller or buyer) market.
I've called San Francisco South Bay home for over many years. We love this area and all it has to offer, and I enjoy sharing what I know about homes. I documented in several books about Silicon Valley history.
I have much expertise in real estate and technology...please give me a call.
Silicon Valley Realtor Sam Shueh Website Phone (4-O-8) 425-1601