September 2010 newsletter

See how local real estate is doing now.

Now simplified and expanded, with plenty of charts for the analytical types and plain explanations for everyone else, and broadened geographically to cover recent real estate trends from Burlingame to the South Bay.  Find out what's hot and not in local real estate.

Still offering hand-crafted and carefully charted statistics you won't find anywhere else, now expanded to show recent trends for these eleven local sub-markets:

And now including seven leading indicators for the Silicon Valley housing market.

First, this month's summary:  In a word, "mixed".  You'd expect real estate to slow at the tail end of summer, with buyer activity down and homes taking longer to sell.  But August 2010 wasn't that simple.  Homes did indeed take longer to sell on average than the month before, but in many markets buyer activity either picked up or maintained its previous level.  So how can activity be up (a sign of a heating market) at the same time days on market is up (a sign of a cooling market)?  One-month trends aren't always worth pondering, but this looks to me like the first stage of a recovery, with homes that have been lingering on the market finally finding buyers.  And as a rule, the low end seemed to be struggling back from its post-tax credit doldrums, while the more expensive neighborhoods continued their late-summer slump.  Prices generally held steady.  Tune in next month to find out whether real estate got its usual post-Labor Day second wind.    

Next, a look at the 13-month trend in sales prices per square foot:

Next, for historical context, a comparison of sales price per square foot between August 2005, 2009 and 2010:

Next, seven leading indicators for the Silicon Valley housing market.

indicator one-year trend short-term trend effect on real estate
San Mateo County unemployment down down good
Santa Clara County unemployment down down good
local business confidence down up good
Silicon Valley VC Index up down bad
30-year fixed mortgage rate down up bad
NASDAQ Composite up up good
Bloomberg Silicon Valley index up up good

And finally, a more in-depth look at what's hot and not in local real estate, looking at the 13-month trend in real estate's two most reliable indicators:

mid-Peninsula top-end single-family residences (SFR):

hot or not?

 13-month trend 1-month trend
so not thawing flat

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mid-Peninsula midrange SFR:

hot or not?

 13-month trend 1-month trend
cool warming cooling

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San Mateo and Burlingame upper midrange SFR:

hot or not?

 13-month trend 1-month trend
not warming mixed

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South Bay upper midrange SFR:

hot or not?

 13-month trend 1-month trend
cool warming mixed

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San Mateo and Burlingame midrange SFR:

hot or not?

 13-month trend 1-month trend
cool mixed cooling

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mid-Peninsula townhomes:

hot or not?

 13-month trend 1-month trend
cold mixed mixed

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mid-Peninsula condos:

hot or not?

 13-month trend 1-month trend
not cooling mixed

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South Bay midrange SFR:

hot or not?

 13-month trend 1-month trend
cold cooing mixed

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South Bay condos and townhomes:

hot or not?

 13-month trend 1-month trend
not mixed mixed

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mid-Peninsula affordable SFR:

hot or not?

 13-month trend 1-month trend
cold mixed mixed

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South Bay affordable SFR:

hot or not?

 13-month trend 1-month trend
warm warming mixed

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Local sub-markets:

Mid-Peninsula top-end SFR:  Homes 2001 sq.ft. or more in top-end Menlo Park, Palo Alto, Woodside and Portola Valley; Los Altos; Los Altos Hills; and Atherton.

Mid-Peninsula midrange SFR:  Homes 2000 sq.ft. or less in entry-level neighborhoods of Palo Alto and Menlo Park; all of Mountain View; and Redwood City and San Carlos west of El Camino.

San Mateo and Burlingame upper midrange SFR:  Homes in the Aragon, Baywood and San Mateo Park neighborhoods of San Mateo, plus Burlingame west of El Camino.

South Bay upper midrange SFR:  Homes in Cupertino, plus the neighborhoods of Sunnyvale, Saratoga, San Jose and Santa Clara with Cupertino schools.

San Mateo and Burlingame midrange SFR:  Homes in San Mateo neighborhoods west of El Camino (except Aragon, Baywood and San Mateo Park) and Burlingame neighborhoods east of El Camino.

Mid-Peninsula townhouses:  Two-plus level CID (Common Interest Development) 2000 sq.ft. or less in Los Altos, Menlo Park, Mountain View, Palo Alto, Redwood City, Redwood Shores and Sunnyvale.

Mid-Peninsula condos:  Single-level CID (Common Interest Development) 2000 sq.ft. or less in the same cities.

South Bay midrange SFR:  Homes in Campbell and adjacent San Jose neighborhoods (MLS Area 15) and the Cambrian area of San Jose (Area 14).

South Bay condos and townhomes:  Homes in Campbell and adjacent San Jose, Cambrian and Santa Clara.

Mid-Peninsula affordable SFR (Single-Family Residences):  Homes at least twenty years old in East Palo Alto east and west of 101; Menlo Park east of 101 (Belle Haven); Redwood City, San Carlos and Belmont east of El Camino; and San Mateo neighborhoods east of 101, plus MLS area 416 Bowie Estate west of 101 but east of El Camino.

South Bay affordable SFR:  Homes in Central (downtown) San Jose (MLS Area 9) except Rose Garden.

Methodology:  For sales price per square foot, a rolling three-month average to minimize statistically irrelevant differences from month to month yet capture the overall trend; then adjusted to the average size of the last 1000 homes sold to minimize distortions in sales price due to variations in average property size sold for each period.  For days on market, a rolling three-month average.  For absorption, the one month average.  All sales except short sales are included.

Thinking of buying or selling?  Please contact me at jfyten@cbnorcal.com.  This is not a solicitation if your home is listed with another broker.  My Department of Real Estate license number is 01044243.

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