Everyone is still trying to get a handle on the condition of the current real estate market. We are seeing mixed messages throughout Santa Clara, Santa Cruz and San Benito Counties as well as throughout the bay area.
Santa Clara County inventory is not climbing rapidly and buyers are being more selective about existing inventory. We currently have approximately 2550 properties on the market in Santa Clara County. Although this is nearly twice as much as we had on the market during the same time period in 2005 (approx. 1385), it is historically, very low.
In 2005, the buyers were buying up and competing for almost every property on the market. This year, we see buyers competing mostly for homes that are very well priced, in good condition and/or in a great location.
Basically, January started off relatively slow but picked up in the last week or two of the month. February started out strong for the first week or two and has since been slower. We are expecting another push as we enter into March but it seems as though the 2006 market has not yet found it's rhythm.
One of the biggest differences so far this year is the number of sales (total units) changing hands versus 2005. We are seeing a decline of anywhere between 10 to 25% fewer properties being sold so far this year versus 2005 (depending on the market area). The average sale price seems to be holding fairly steady and we are certainly seeing a variety of multiple offer situations but it is somewhat mixed and not across the board. Buyers are certainly out there and many open houses have been filled with 100 or more visitors over the course of one weekend.
Reports from around the region suggest the same. Inventory is increasing ever so slightly and buyers are going after well priced homes. One office had multiple offers on 50% of their sales during the week of Feb. 5th-11th and on all their sales during the week of Feb. 12th-18th.
Other offices experienced a large percentage of multiple offers over the past few weeks on properties listed between $620k and $1.6 million during the week of Feb. 12th-18th. One office saw 12 offers on a property listed over $1 million in Sunnyvale and a property listed in Los Altos at $1,499,000 received 12 offers and went well over list price.
Again, in most situations, properties seem to be sitting a bit longer and if/when they do receive multiple offers it's usually around 2 or 3.
Having said all that, this is still a good market and perhaps much more balanced than we've experienced over the past year or two. Most economists have predicted a more "normal" market and a "soft landing" for the real estate in 2006.
Expect more inventory and somewhat increasing buyer demand as we move into March.
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