Interesting question. Although I don't live in hillsborough proper, I have the impression that a large percentage of residents there are employed in banking and the finance industry. Turns out based on your question I did a little digging on the sellers currently in the market. Looking up names in linkedin did confirm this.

I would guess there is a larger percentage of sellers who bought recently because they have been more severely impacted by the recent crisis.

Thanks for the replies,

I agree the actual sales stats are not much different than the rest of the peninsula, but what struck me is the high percentage of sellers that bought within the last five years that are trying to get out. Checking on westlaw on a couple of listings, some of the purchases were financed with sizable jumbo loans that are set to reset next year.

Presumably if you don't have to sell you wouldn't have your home on the market when demand in the high end is weak.

For those of you that have info on off market sales, what has been the average $/sqft compared to transactions on the mls?

Many thanks

First, my apologies to Pa, your thread has been inadvertantly "hijacked" by Goat, who is intent on proving that the real estate market is sinking fast in all parts of California.

Goat, unfortunately, I cannot see from what source you're getting your statistics. As of this evening, there are only 73 active listings in Hillsborough, with 3 short sales and 3 REOs. Of those 73 listings, only 7 have been on the market for more than 200 days. The others are all only--at the most--100 days. Perhaps if we knew the source of your information, it might help explain why there is such an apparently huge discrepancy between what you represent is the the number of homes on the market, the number of REOs and the number of days on market and what we are seeing in the actual local database of homes for sale.

Just curious.

Sincerely,
Grace Morioka, SRES, e-Pro
Area Pro Realty

Why have 70 of those active listings been on the market for over 275 days?

Is that a testy tone? Why are you so stressed Big D?

For your info, Goat, as of 9:45 PM tonight, there are 73 active listings in Hillsborough with 3 being REO's and 3 short sales. I would say that falls way short of your estimate.

Tap

"As with any highly desirable area of the Peninsula, I think that Hillsborough will have some foreclosures, but the actual number of homes becoming REOs are, much like better sections of Palo Alto, Woodside, Menlo Park, Los Altos, going to be small...."

and

"There is a certain monied ambience that accompanies the more exclusive communities like Palo Alto (near Stanford University), the hills of Los Altos, the towns of Woodside, Atherton and Hillsborough, that will not succumb to the economic pressures that plague so many of us who live squarely in the "middle classes.."

is contradicted by the data:

23 homes in foreclosure/reo
17 homes for sale nondistressed

1.35 homes are in foreclosure for every home for sale. This is an astoundingly high foreclosure rate. Wow!

What the heck is happening in Hillsborough? Why do call this many homes in foreclosure..."small"?

We are so freaking doomed! (WASFD)

Hello Pa and thanks for your question.

As with any highly desirable area of the Peninsula, I think that Hillsborough will have some foreclosures, but the actual number of homes becoming REOs are, much like better sections of Palo Alto, Woodside, Menlo Park, Los Altos, going to be small, so I would not necessarily state that sellers here have more "pressure" than in other more exclusive sections of the peninsula. Both Dave and Brendan have done great jobs explaining the activity in this market, so I won't rehash.

Goat, you've asked why we suspect homes will remain well above the $1 million ad $2 million mark in the more desirable sections of Northern California--such as Hillsborough--we need only point to the individuals who inhabit these homes and the companies located along the peninsula, such as Oracle, Intel, Apple (Steve Jobs has a house nearby), SunMicro, Google, Adobe, AE Sports, Netflix, etc. It can be difficult for those living in other states to know this, but California--if it were a country-would be have a GDP riveling many global countries. So while we do admittedly have huge debt, we are also one of the quickest states to "turn things around" when the economic weather gets better. Many of our manufacturing concerns have left California, true, but our software designers, engineers and "think tank" mind banks (including Nobel Prize winners who live in these areas along with celebrities such as Shirley Temple Black--oh, she of the good ship lollipop) have never left.

There is a certain monied ambience that accompanies the more exclusive communities like Palo Alto (near Stanford University), the hills of Los Altos, the towns of Woodside, Atherton and Hillsborough, that will not succumb to the economic pressures that plague so many of us who live squarely in the "middle classes." This huge diversity in income that exists in Northern California and even in areas just miles from one another can be very hard to understand, which is why truly knowledgeable Realtors need to understand not just the overall market in towns where they practice their professional, but also the "micro communities" that are situated in geographical areas.

So, there will always be money in the more exclusive sections of California. Should there ever come a time when a home in Hillsborough falls to $200K, I will be front and center with cash to buy it, but as this has never happened in my lifetime, I do not anticipate leaving my lovely home in Sunnyvale anytime soon.

Thanks for your question PA and your comments, Goat.

Sincerely,
Grace Morioka, SRES, e-Pro
Area Pro Realty
San Jose, CA

Dave,

That does not answer my question.

What is going to drive income to make it possible for those million dollar homes affordable. If you are an expert in the area then please tell us what industry is in growth mode and producing the dollars for the home buyers?

Do you have a depression resistant industry there? Printing press perhaps?

Notice there are 23 foreclosures in this area starting at the $4M mark , 4 new listings and 13 price reductions. This looks really bad when foreclosures outnumber traditional sellers.

Pricing appears to be unappealing to buyers.

Goat, with all due respect, it's probably best to give real estate advice where you practice real estate. To try and determine the value of an area or city where you have no knowledge of is not kosher.

The lot values in Hillsborough are all over a million, and some lot's are worth over $3MM.

I couldn't tell someone for the life of me what a home is worth in Denmark. I would refer them to you :)

Cheers,

Tap

"Now, I have to address the comment from "Goat". You will not see homes in hillsborough for $200,000 unless maybe if it is a 10'x10' lot."

Gonna save this one and get back to you inside two years.

What industry is going to provide the income required to sustain these prices again?

Pa, the market is not going to hit Hillsborough harder than the other sectors of the market because the people who buy in the high end either have good careers and income, along with good credit and strong down payments, or they come from old money.

You don't purchase a home in Hillsborough with no money down and have bad credit. Yes, everyone has felt the economic down turn, and yes, there will be some REO (bank owned) sales, along with a some short sales, but I think you will see a much smaller figure of high end homes versus entry level homes coming on the market as distressed properties.

Around two months ago there was talk that the bubble was about to burst and there were and still are some who are not doing well because of the business sector and stock market. Then it seemed like someone hit the light switch and things started to pick up.

One listing had 7 offers, listed at $2,295,000 and sold for over $2,700,000. Another one had 3 offers, so the market is not falling apart.

Yes, some folks are in danger of losing their home and will have to sell. There are a few pocket listings where people want to sell, but would prefer it to be a quiet transaction, but the market is very close to the bottom , at least that is my opinion.

If you are interested in pocket listings, let me know.

Cheers,

Tap
Realtor
Cashin Company http://www.DavidTapper.com
650-403-6252

Hi Pa_Home_Buyer,

When I look at Hillsborough, I Look at the city as a whole; not just properties over $2,000,000. As of Monday, there were 75 Active listings in the city of Hillsborough ranging from $18,000,000 to $1,064,000 While there is a a rising number of REOs (1-2 pop up occasionally) in Hillsborough many people are trying to buy up in a down market.

Like anywhere else, homes that are priced right and marketed effectively get sold. Month to date (as of monday): 13 homes are in pending status and 7 sold. That's not that bad.

Hillsborough has been hit, but not badly. So I wouldn't say that the downturn will affect "Hillsborough more agressively". If you read my stats on TeamTapper.com for the local area (Redwood Shores to Burlingame) the number of newer listings is leveling off, pending sales are up significantly, and sold homes are now also starting to level off. Things are looking up!

Now, I have to address the comment from "Goat". You will not see homes in hillsborough for $200,000 unless maybe if it is a 10'x10' lot. Our area, California, and that United States will and is making a comeback from this economic downturn. (Looks like the anti-patrioritic pessimists from Zillow found their way to Trulia).

Brendan Aiello
650-403-6262
AielloB@gmail.com http://www.BrendanAiello.com

This price range will experience unimaginable suffering unless you can imagine $200,000 for a previously $2m property.

America has been gutted of its producers. The few that are left are relocating to countries more appreciative of businesspeople.