The Silicon Valley housing market continues its fast-paced recovery, ending 2012 with strong gains in sales and median price compared to the previous year.
The California Association of REALTORS® reports December 2012's sales of existing, single-family detached homes in Santa Clara County rose 8.8 percent from the previous year. Sales dipped slightly by 0.4 percent from November. Meanwhile, the December median price of a Santa Clara County single-family home was $681,000, up 0.3 percent from the November median of $679,000 in 2012, and up 27.3 percent from $535,000 in December 2011.
Information from MLSListings Inc., the multiple listing service of the Silicon Valley Association of REALTORS®, shows an active local market. There were 32 single-family home sales in Los Gatos in December 2012, up from 26 in the previous month and 25 in December 2011. Saratoga had 31 closed sales of single-family homes in December 2012, down from 34 in November, but up from just 22 in December 2011.
The median sales price of a single-family home in Los Gatos was $1,290,000 in December 2012 and $1,130,000 in December 2011. In Saratoga, the December 2012 median was $1,660,000, up from $1,593,000 in the previous year.
Silicon Valley Association of REALTORS® president Carolyn Miller said the region's market is active, but the tight inventory is a concern. "The spirits of many potential home buyers are dampened because there just aren't many homes for sale. Even buyers who have the cash are being outbid several times by other cash buyers," said Miller.
According to MLSListings, inventory of single-family homes in Silicon Valley continues its drop from December 2011 levels, with Santa Clara County's inventory down 57 percent and neighboring San Mateo County following closely down 52 percent. In December 2012, Los Gatos had a current inventory of 53 single-family homes on the MLS, compared with 81 in the previous month and 80 in December 2011. Saratoga had a current inventory of 47 single-family homes in December 2012, compared with 64 in November 2012 and 89 in December 2011.
The statewide housing market appears to have ended 2012 on a high note, as well, with home sales and prices both posting gains in December. According to information collected by the California Association of REALTORS® (C.A.R.) from more than 90 local REALTOR® associations and MLSs statewide, closed escrow sales of existing, single-family detached homes in the state totaled 522,510 units in December, up 0.9 percent from December 2011.
The statewide median price $366,930 for an existing, single-family detached home was up 5 percent from November's median of $349,300, and 27 percent higher than the December 2011 median of $288,950. C.A.R. attributes the substantial increase in price largely to the significant increase of higher-priced properties, while inventory constraints continued to constrict sales of lower-priced homes.
The state's housing inventory for existing, single-family detached homes in December was 2.6 months, down from 3.1 months in November and a revised 4.3 months in December 2011. The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate. A six- to seven-month supply is considered normal.
"The story is the same statewide and in other parts of the nation. Inventory is incredibly tight," said Miller. "I don't see the picture changing anytime soon. If you are looking to buy, get ready to face a multiple offer situation and perhaps, a bidding war. You definitely need to realize what you're up against."
Miller tells buyers, "Be ready to come in with your best price and also be realistic. It's important to know what is of good value in specific areas. An experienced REALTOR® can guide buyers to making the decision that is right for them."
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please contact Rose Meily at SILVAR Public Affairs, email , or phone (408) 200-0109.