SF Peninsula & Silicon Valley: How Q1-‘14 compared to: Q1-‘13, Q1-‘09, and 15yr Averages
BUYERS NERVOUSNESS INCREASES WHILE HOMES APPRECIATE RAPIDLY
Lack of homes for sale remained the greatest factor in the local housing maket in the first quarter of 2014. Warnings of an imminent “market top” and a “housing bubble” echoed throughout the various news services and media. Yet, it did little to dampen the numbers of offers on homes. Nor did it stop buyers from offering to pay greatly over the asking prices for the few homes available each week. How long will this housing market boom continue? That is now the question everyone is asking!
On average, among the cities in the charts below, during the first quarter of ’14 new listings were down by 34% from their 15 year averages. As a result, sales were down by 17%. It took half as long for a home to sell in Q1 ’14, compared to the 15 year average. Until buyers begin to balk at the asking prices – which has yet to happen with any frequency – or when a financial shock of some magnitude causes a drop in consumer confidence, we anticipate that the current “seller’s market” will continue unimpeded.
Median sales prices were up, on average, by 45% since 2009! Buyers paid 5% over asking price, on average, in 2014 compared to 5% under the asking price in 2009. The price of homes per square foot was up by 42%, on average, compared to 2009. Location, location, location: Homes that are the most volatile (that rise and fall the most in value in each cycle) are those with “unremediable issues” – negative location issues or poorly designed floor plans. There is very little discount for homes with negative attributes in today’s hot market, but they drop greatly in value in a slower market. Folks in homes with location “issues” are wise to sell now, before the market turns. Conversely, buyers must now select very carefully!
WANT MORE SPECIFIC INFORMATION?
The towns included above have diverse neighborhoods and prices. When we look at averages we get clues to the overall market, but not the details. If you would like an in-depth analysis of market trends in your particular town or neighborhood, simply call Jeff at 650/823-8057 or Steve at 650/450-0160, or email us: [email protected], or visit our website: JeffAndSteve.com. We’ll be happy to help!