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Elena Talis' Blog

By Elena Talis | Broker in Palo Alto, CA
  • A Strong Recovery or a New Real Estate Bubble?

    Posted Under: Market Conditions in California, Home Buying in California, Home Selling in California  |  April 16, 2013 10:50 PM  |  503 views  |  No comments

    Bay Area real estate prices are soaring to new heights.  According to Realtor.com, 6 of 7 US metro areas with the fastest rising median list prices are in California, and 3 of those are right here in the Bay Area.  Oakland recorded a 31 percent year-over-year increase, followed by San Jose (29 percent) and San Francisco (26 percent).  While these are welcome statistics for many homeowners, the rapid rise in prices leads some to question whether we are entering a new real estate bubble.

    The current price surge is fueled by a shortage of inventory: there are simply not enough homes available for sale while demand is supported by record low interest rates.  The shortage of inventory is most severe in the single family home sector of the market as throughout California the majority of new construction permits are being issued for multi-family development projects.  In general, California’s regulatory climate slows down the market’s response to the housing shortage, both for single family and multi-family construction projects.

    In the meantime, income in Silicon Valley is not increasing as quickly as are housing prices.  The home affordability index (median home price to the median family income ratio, with a lower index number indicating more affordable housing) is on the rise again.  After reaching 9.3 in 2006 in the Silicon Valley, the index dropped to 6.7 in the middle of the recession.  Today Silicon Valley’s home affordability index stands at 7.9.  Keep in mind that national average for the home affordability index in United States is only 2.8.

    Being optimistic, we lean toward the point of view that current market conditions are only the first stage of a long-term real estate recovery rather than a market bubble.  The combination of increased housing supply as well as a gradual increase in the interest rates will help control runaway prices and will produce more balanced market conditions.  Recovery or bubble, we will have more visibility into longer term market trends as the spring selling season moves forward.

  • March 2013 — Palo Alto Median Price Stays Over $2M Mark

    Posted Under: Market Conditions in Palo Alto, Home Buying in Palo Alto, Home Selling in Palo Alto  |  April 8, 2013 11:32 AM  |  558 views  |  No comments

    The Palo Alto Alto real estate market has firmly stepped into $2M territory.  While the median price decreased slightly from last month, year-over-year growth was more than 29 percent.  The market continues to be very robust and most properties are being sold in record-short times.  Average time on market dropped to 17 days, the lowest number since August of 2012.

    The majority of homes are being sold for values significantly above the asking price.  In March, only 4 homes in Palo Alto were sold below the asking price; the average overbid was 14.3 percent.  Two homes, both in our area, stood out: a house on 2750 Bryant St. was sold for $1,730,000, 39 percent over the asking price.  Another home at 3985 Bibbits Dr. went for $1,838,000 or 32 percent over the asking price.  The highest overbid in March was for a property on 131 Washington Ave. — a whopping 55 percent (listed at $949,950 and sold for $1,470,000).

    We expect the shortage of inventory to keep sellers firmly in the driving seat for the foreseeable future.  While 39 new single family homes were put on the market in March, there were 46 new offers accepted, indicating that buyers’ demand significantly outpaces the rate of new listings.

    Call Elena and Michael at 650.714.4784 to talk more about these unique market conditions and how real estate can help you achieve your financial goals.

    Month-Over-Month



    Month, Year Listed Sold Median Price DOM
    Dec. 2012 9 42 $1,835,000 24
    January 2013 23 14 $2,250,000 38
    February 2013 39 16 $2,330,000 19
    March 2013 39 28 $2,200,000 17





    Year-Over-Year



    Month, Year Listed Sold Median Price DOM
    March 2010 51 28 $1,410,000 60
    March 2011 84 44 $1,590,000 21
    March 2012 53 42 $1,700,000 16
    March 2013 39 28 $2,200,000 17
  • Palo Alto Shortage of Inventory Continues Into Spring

    Posted Under: Market Conditions in Palo Alto, Home Buying in Palo Alto, Home Selling in Palo Alto  |  April 3, 2013 10:30 PM  |  472 views  |  2 comments
    Property Sales: March property sales were 27, down from 42 in March of 2012 and 68.8% higher than the 16 sales last month. March 2013 sales were at their lowest level compared to March of 2012 and 2011. March YTD sales of 57 are running -33.7% behind last year's year-to-date sales of 86.

    Prices:
    The median sales price in March was $2,190,000, up 29.6% from $1,690,000 in March of 2012 and down -1.1% from $2,215,000 last month. The average sales price in March was $2,447,333, up 27.4% from $1,921,489 in March of 2012 and up 6.5% from $2,298,750 last month. March 2013 ASP was at highest level compared to March of 2012 and 2011.

    Inventory & MSI: The total inventory of properties available for sale as of March was 17, down -43.3% from 30 last month and down -52.8% from 36 in March of last year. March 2013 Inventory was at the lowest level compared to March of 2012 and 2011.

    A comparatively lower MSI is more beneficial for sellers while a higher MSI is better for buyers. The March 2013 MSI of 0.6 months was at its lowest level compared with March of 2012 and 2011.

    Market Time: The average Days On Market (DOM) shows how many days the average property is on the market before it sells. An upward trend in DOM tends to indicate a move towards more of a buyer's market, a downward trend a move towards more of a seller's market. The DOM for March was 12, down from 19 days last month and down from 16 days in March of last year. The March 2013 DOM was at its lowest level compared with March of 2012 and 2011.

    Selling Price Per Square Foot: The selling price per square foot is a great indicator for the direction of property values. Since median sales price and average sales price can be impacted by the 'mix' of high or low end properties in the market, the selling price per square foot is a more normalized indicator on the direction of property values. The March 2013 selling price per square foot of $1,143 was down -0.7% from $1,151 last month and up 22.4% from $934 in March of last year.

    Selling Price vs Listing Price: The selling price vs listing price reveals the average amount that sellers are agreeing to come down from their list price. The lower the ratio is below 100% the more of a buyer's market exists, a ratio at or above 100% indicates more of a seller's market. The March 2013 selling price vs list price of 114.8% was up from 113.4% last month and up from 109.1% in March of last year.
  • February 2013 — Demand Drives Prices Even Higher

    Posted Under: Market Conditions in Palo Alto, Home Buying in Palo Alto, Home Selling in Palo Alto  |  March 19, 2013 11:04 AM  |  586 views  |  No comments

    For the second month in a row the median sale price in Palo Alto has held above $2M.  The February median price reached $2,330,000, a 3.6 percent increase from just a month ago and a 19.5 percent jump from the same month last year.  The average price per square foot reached a record level of $1,151 and on average the sale price was 13.4 percent higher than the listing price.  At the risk of sounding like a broken record, we again have to repeat that the real estate market continues to experience a shortage of inventory, creating conditions strongly favorable to sellers.

    Similar conditions persist in the cities up and down the Peninsula.  During February there were 28 active listings in Menlo Park, while a year ago there were 39 active listings.  In Mountain View, there were 19 listings this February compared with 27 a year ago, in Los Altos 48 compared with 75 last year, and 18 in Sunnyvale compared with 60 last year.

    The skyrocketing prices of local real estate as well as high rental prices have attracted the attention of investors across the world that are looking for secure investments with high return rates.  This increased competition for available homes on the market between the investors and traditional family buyers have contributed to the uncommonly strong current seller’s market.  Furthermore, ongoing record-low interest rates are adding fuel to the buying frenzy.

    Call Elena and Michael at 650.714.4784 to talk more about these unique market conditions and how real estate can help you achieve your financial goals.

    Month-Over-Month



    Month, Year Listed Sold Median Price DOM
    Nov. 2012 27 51 $1,698,000 21
    Dec. 2012 9 42 $1,835,000 24
    January 2013 23 14 $2,250,000 38
    February 2013 41 16 $2,330,000 19





    Year-Over-Year



    Month, Year Listed Sold Median Price DOM
    February 2010 40 23 $1,505,000 48
    February 2011 44 24 $1,617,000 29
    February 2012 42 24 $1,950,000 29
    February 2013 41 16 $2,330,000 19
  • Palo Alto Home Prices Continue to Grow While Lack of Inventory Stuns The Sales

    Posted Under: Market Conditions in Palo Alto, Home Buying in Palo Alto, Home Selling in Palo Alto  |  March 2, 2013 11:11 PM  |  518 views  |  No comments
    Property Sales: February property sales were 15, down from 24 in February of 2012 and 7.1% higher than the 14 sales last month. February 2013 sales were at their lowest level compared to February of 2012 and 2011. February YTD sales of 29 are running -34.1% behind last year's year-to-date sales of 44.

    Prices: The median sales price in February was $2,330,000, up 19.8% from $1,945,000 in February of 2012 and up 5.7% from $2,203,500 last month. The average sales price in February was $2,325,333, up 11.7% from $2,081,417 in February of 2012 and down -6.4% from $2,483,786 last month. February 2013 ASP was at highest level compared to February of 2012 and 2011.

    Inventory & MSI: The total inventory of properties available for sale as of February was 29, up 26.1% from 23 last month and down -17.1% from 35 in February of last year. February 2013 Inventory was at the lowest level compared to February of 2012 and 2011.

    A comparatively lower MSI is more beneficial for sellers while a higher MSI is better for buyers. The February 2013 MSI of 1.9 months was at a mid range compared with February of 2012 and 2011.


    Market Time: The average Days On Market (DOM) shows how many days the average property is on the market before it sells. An upward trend in DOM tends to indicate a move towards more of a buyer's market, a downward trend a move towards more of a seller's market. The DOM for February was 19, down from 38 days last month and down from 29 days in February of last year. The February 2013 DOM was at its lowest level compared with February of 2012 and 2011.

    Selling Price Per Square Foot: The selling price per square foot is a great indicator for the direction of property values. Since median sales price and average sales price can be impacted by the 'mix' of high or low end properties in the market, the selling price per square foot is a more normalized indicator on the direction of property values. The February 2013 selling price per square foot of $1,177 was up 30.9% from $899 last month and up 24.7% from $944 in February of last year.

    Selling Price vs Listing Price: The selling price vs listing price reveals the average amount that sellers are agreeing to come down from their list price. The lower the ratio is below 100% the more of a buyer's market exists, a ratio at or above 100% indicates more of a seller's market. The February 2013 selling price vs list price of 113.0% was up from 101.1% last month and up from 105.1% in February of last year.
  • Week of 3/1/2013 - Homes Listed and Sold in Palo Alto

    Posted Under: Market Conditions in Palo Alto, Home Buying in Palo Alto, Home Selling in Palo Alto  |  February 28, 2013 11:43 PM  |  463 views  |  No comments

    This week in numbers:

    • 18 new homes were put on the market this week in Palo Alto - 15 single family homes and 3 condos.  Same week last year 16 homes were listed.  The inventory continues to increase - 37 units are currently available for sale (29 single family homes and 8 condos). 
    • 14 new contracts were accepted this week.  Same week last year 10 homes went into pending state.
    • 6 escrows were closed this week.  Same week last year 10 home went to the new owners.
    • 3 home failed to sell and were taken off the market.

    Contact Elena or Michael Talis at 650.714.4784 to talk more about current market condition.
    To see all current Palo Alto listings go to TalisRealEstate.com.
    Use this link to see all Palo Alto Real Estate Market Weekly Reports.

  • January 2013 — Palo Alto Housing Drought Continues

    Posted Under: Market Conditions in Palo Alto, Home Buying in Palo Alto, Home Selling in Palo Alto  |  February 16, 2013 12:13 AM  |  316 views  |  No comments

    The rush to close home purchases before the end of the year cleared up the inventory of houses available for sale to levels not seen for a while. In January only 23 homes were listed — a 36.1 percent drop from last year.

    With so few homes coming to the market, the prices continued to be driven up. The median price of a single family home went over $2M in January reaching $2,157,000, a 17.5 percent jump from December of 2012 and a 42.3 percent jump from January of last year.

    While the Silicon Valley economy continuing to perform and the DOW reaching 14,000 on February 1st for the first time since October 2007 there seems to be no shortage of willing buyers being able to afford homes at the new price levels. A home in downtown area was listed at $1,795,000 and was sold for $2,150,000, a 19.8 percent jump.

    What we experiencing now is a strong seller’s market. Multiple offer situations rule the day and buyers are jumping on well prepared homes in move-in condition. If you are thinking about selling you have to budget both time and money to prepare the home for the new owners. Most probably they will be a family with kids with both parents being working professionals. Making them feel at home will go long way to getting the best price for your property.

    Call Elena and Michael at 650.714.4784 to talk more about market conditions and the best ways of preparing homes for sale.

    Month-Over-Month



    Month, Year Listed Sold Median Price DOM
    October 2012 52 44 $1,845,000 25
    Nov. 2012 27 51 $1,698,000 21
    Dec. 2012 9 42 $1,835,000 24
    January 2013 23 13 $2,157,000 34





    Year-Over-Year



    Month, Year Listed Sold Median Price DOM
    January 2010 42 23 $1,325,000 65
    January 2011 33 16 $1,220,000 64
    January 2012 36 20 $1,515,000 35
    January 2013 23 13 $2,157,000 34
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