In September, the Bay Area maintained its position as California’s most in-demand region for real estate. According to the September California Association of REALTORS®report, six of nine Bay Area counties had less than three months’ supply of inventory, and of the six – two had less than a two months’ supply. The report indicated that San Mateo took the No. 1 spot with the highest price per square foot at $883/sq. ft., followed by San Francisco ($875/sq. ft.), and Santa Clara ($687/sq. ft.).
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East Bay – Oakland reported multiple offers with less contingencies in September. Home sales have slowed compared to recent months, some remaining on the market for three to four weeks as compared to a two-week period during summer. There are still motivated buyers who are looking to be settled in a new home before the holidays and sellers should not hesitate to list their homes now.
Monterey County – Monterey Peninsula closed September with an increase in both dollar and unit sales. Buyers continue to seek more options and act quickly when newly-listed properties enter the market.
North Bay – Greenbrae showed a strong September regardless of low inventory and buyer interest remains high. Year-over-year, prices were up 10.7 percent and units increased by 16.6 percent. The median price point also increased to $1,286,000 versus $1,191,500 in 2016. Properties under $1 million were especially popular and sold swiftly. Buyers do have some good news in the form of low interest rates and the ability to negotiate, especially on properties listed for over a month.
Novato had a downturn in the real estate market after the devastating fires in Sonoma and Napa counties. The fires increased demand on housing inventory for both sale and rental properties as many residents were displaced. Sellers continue to receive multiple offers, with many all cash. Buyers in Novato saw favorable conditions, such as lower interest rates and less competition.
Southern Marin experienced a slowdown following Labor Day with an increase in days-on-market and fewer multiple offers. Sellers still have a window of opportunity to list their homes before the holidays, but must be sure to price their properties competitively. Buyers have more options with an increase in inventory. In the luxury market, 16 percent of listings over $3 million are under contract.
Placer County – Tahoe saw 87 properties sold during the month of September, the third highest two-week sales period year-to-date. Twenty-eight of those properties were sold above $1 million. In 2017, there were 217 properties sold over $1 million, down 6 percent from 2016. The median sales price for luxury properties is down about 8 percent from 2016, at $1,525,000. The average sales price of luxury homes year-to-date stands at $2,262,092 as compared to $2,375,008 in 2016, which is a 5 percent decrease.
Sacramento County – Sacramento Fair Oaks saw a decrease in closed sales, but ended the month with 2,663 pending sales, a 7 percent increase compared to September 2016. Available homes decreased by 6 percent year-over-year. Due to more limited inventory, there was a 9.4 percent increase in the median sales price. Sellers should price their homes within market range and ensure their properties show well and are clutter free during open houses. Between now and Thanksgiving is the optimal time to list, as buyers are motivated and ready to make offers.
In Sierra Oaks, the market saw solid activity. In the luxury market, buyers had a lot of inventory to choose from and sellers are willing to negotiate.
San Francisco – San Francisco Lombard remained active with 80-85 percent of homes and 65 percent of condos selling for above their asking price. Buyers in San Francisco are encouraged to make offers now. If they wait, they could lose out on the equity that could eventually get them into their dream property in the future.
San Francisco Pacific Heights saw continued shortages in inventory. The luxury market had multiple properties go into contract, although many sales were executed off-market.
SF Peninsula – Half Moon Bay reported an all-time low in inventory supply. Although this makes the housing market tough for prospective buyers, many were still encouraged by low interest rates. Palo Alto downtown also saw low inventory that led to multiple offers on most, if not all properties.
Redwood City experienced a healthy demand and saw many sales exceeding asking prices. One instance was an uninhabitable house in southern San Francisco that listed for $550,000 and received 29 offers, selling well above the listing price. The luxury market remained active, although properties did not move as quickly.
San Mateo saw an increase in both inventory and prices. The luxury market was active, but slower with properties priced above $2.5 million.
Santa Cruz County – Days-on-market was at an all-time low of 40 days in Santa Cruz because of low supply and favorable conditions. The month ended with only 250 single family homes on the market as opposed to the high of 1,457 homes available in July of 2007. The sellers’ market has led to multiple offers within a few days of listing. The luxury market has remained steady over the last five years at around $1.4 million.
Silicon Valley – Cupertino saw an active market, at times with more pending sales than active listings. Buyers are encouraged to start house hunting as Silicon Valley is a uniquely strong region with exceptional demand. The luxury market remains active with several sales exceeding $6 million.
Gilroy and Morgan Hill saw low inventory and over 65 percent of the 54 available homes sold for over $1 million. Entry-level homes can be challenging to find, although the average list price of Gilroy is slightly lower. Overall, the area remains a sellers’ market with multiple offers and homes selling for above asking.
Los Altos experienced a continued sellers’ market with low inventory and multiple offers on most listings. The average days-on-market remained low, ranging from 13 days in Sunnyvale to 35 in Los Altos Hills. Sellers need to ensure their homes are priced and primed for a competitive sale. And buyers must be prepared with financing and a knowledgeable, trusted agent to represent their best interests. Buyers must also be aggressive as the market is highly competitive and sellers are more responsive to solid offers. The luxury market priced above $4.5 million in Los Altos is steady and flat. On average, time on market is 44 days. Inventory is steadily increasing and the number of sales in the high-end market is down slightly.
Los Gatos saw a sustained sellers’ market, and luxury activity remains strong and active.
San Jose saw inventory at a record low. That coupled with low interest rates has created an increasingly competitive market for buyers. Even with the strong demand, sellers are encouraged to price their home competitively – at or slightly below market price – to avoid pushback from buyers. Because of the current competitive landscape, buyers should be ready to make an offer quickly because hesitation may cost them a great opportunity.
Saratoga saw multiple offers on most of its listings and a continued sellers’ market. Buyers who are ready to make a move should have all financing in order. The high-end luxury market experienced an increase in listings with 24 properties for sale in September, a 9.1 percent increase from August 2017, and a 71.4 percent increase from September 2016.
El Dorado County – El Dorado Hills had less than two months of inventory priced under $750,000 and about a year of inventory in the $750,000 to $1 million price range. Year-over-year, sales were down 14 percent compared to 2016. Homes priced under $500,000 continue to receive multiple offers.
Market Watch is a monthly column exploring the Northern California housing market. Click here to view past issues.