Welcome to June! We are in a new month, and this allows the opportunity to look back at May to see how the market has changed. I have been waiting for more data to indicate the condition of the South Bay Area market, beyond my own anecdotal experience with my buyer and seller clients, and the conversations I have with other Realtors and those in related industries (which is important and gives context to the numbers).
First, my opinion: An increase in buyers entering the market and fewer than expected properties coming on the market. I based this on increasing showings of my listings and my buyer clients really struggling to find new properties that fit their needs.
Then I look at the numbers: In the last week, Santa Clara County had 349 properties accept offers (The highest since Shelter In Place began) and 286 new listings came on the market (the lowest in 3 weeks, when normally inventory increases weekly through spring and summer).
As I have been saying, combining historically low interest rates with close to historically low inventory has kept prices from dropping and momentum already seems to be building. Add in more businesses opening with relaxed SIP regulations, and the typically competitive spring market seems to be upon us.
Looking back at May, the number of sales (660) is the lowest since January of 2019. The median sales price on the other hand ($1,232,500 for Single Family Homes, Townhouses and Condos) is the highest price since June of 2018. It is also a 1.4% increase from last month.
When I say historically low interest rates, I’m referring to the fact that since the early 70’s, the average interest rate for a home mortgage is 8%. Right now (and keep in mind your rate depends on factors such as credit score and Loan-to-Value ratio) rates are approximately 3.625% for a conforming loan and 3.25% for a jumbo loan (a loan amount above $765,600).
I expect June will bring more properties to the market, although fewer than we typically see, and an increase to prices as well.
Here is the breakdown for each city and MLS area in Santa Clara County by median sales price for May compared to April, 2020. Keep in mind that the low number of sales in some of these areas skews statistics to some degree. The County as a whole is somewhat more helpful, since there is more data. Some markets are healthier than the percentage change may reflect.
Area 1 (Gilroy/Morgan Hill/San Martin) $982,500 (+19%)
Area 2 (Santa Teresa) $875,500 (-4%)
Area 3 (Evergreen) $935,000 (-11%)
Area 4 (Alum Rock) $750,000 (-6%)
Area 5 (Berryessa) $880,000 (-13%)
Area 6 (Milpitas) $1,100,000 (+5%)
Area 8 (Santa Clara) $1,272,500 (-10%)
Area 9 (Central San Jose) $838,500 (-6%)
Area 10 (Willow Glen) $1,400,000 (No Change)
Area 11 (South San Jose) $850,000 (+8%)
Area 12 (Blossom Valley) $954,500 (-4%)
Area 13 (Almaden) $1,587,500 (+4%)
Area 14 (Cambrian) $1,128,888 (-8%)
Area 15 (Campbell) $1,380,000 (+2%)
Area 16 (Los Gatos) $1,917,500 (-20%)
Area 17 (Saratoga) $2,447,500 (+1%)
Area 18 (Cupertino) $1,840,000 (-12%)
Area 19 (Sunnyvale) $1,850,000 (+5%)
Area 200-210 (Mountain View) $1,658,000 (+2)
Area 211-214 (Los Altos) $2,950,000 (+7%)
Area 221 (Los Altos Hills) $3,700,000 (-1%)
Area 230-242 (Palo Alto) $2,777,000 (+9%)