Weekly Market Report for the Week of February 26th- March 4th, 2006:

Is the market "normal" or "mixed?"

Buyers are certainly out there and activity is healthy but moving at a significantly slower pace than last year. Buyers are being much more selective and are seeking out the best properties, in the most desirable areas and at the "right" price. Prices are holding steady and the average sale price is up over 10% this year to date in Santa Clara County. The number of sales are still lagging behind 04' and 05' figures.

Santa Clara County inventory is a little under 2700 total properties for sale. This is ahead of the same time last year (1550) and very near the 04' mark during the first week in March (2200). Some offices reported 50% of their transactions involving multiple offers while others reported none. High end homes have been moving in select areas. On the Monterey Peninsula, for example, approximately 20 properties between $2-20 million have closed escrow over the past few months. The Peninsula has also reported several properties over $30 million selling in the most prestigious locations.

Inventories throughout the bay area including Santa Cruz, Santa Clara County, the Peninsula and San Francisco are still historically low. Some agents are reporting a "pick-up" in sales activity while others are reporting that "it seems too quiet for the time of year." Whatever the case might be, demand is healthy and there is still much more demand than supply.

The mixed signals are making it difficult for the market to get into a steady rhythm. In the meantime, Sellers should be sensitive to pricing their properties while buyers are processing through the reality that the "bubble" the media has been so fixated on has not come to fruition.