Are Los Gatos Real Estate Prices Holding Amidst the Financial Meltdown?

December 19, 2008

The Los Gatos real estate market has had a difficult year in 2008. Are things improving now, levelling off, or worsening? What Los Gatos homeowners care about most is value: what’s my home worth now? Today we will look at what list prices are doing among Los Gatos proerties for sale: both single family homes (houses) and condominums and townhomes in both the 95030 and 95032 zip codes.

The data, care of Altos Research, pretty much speaks for itself. The situation varies from one area to the next and one price point to the next. For more detailed information than is presented here, please contact me directly.

I. Broad Overview of Los Gatos homes for sale

First let’s see an overview of list prices for single family homes in Los Gatos by zip code (all price quartiles combined).

 

Los Gatos single family homes for sale (houses), both 95030 and 95032 zip codes, median list price

Next, same type of data but for Los Gatos condominiums and townhomes for sale (both zip codes, median list price).

 

Los Gatos homes for sale, condos, both 95030 and 95032, median list prices of all quartiles combined

II. Closer look at houses for sale in Los Gatos

Next we’ll look more closely at single family homes by zip code and by price point or quartile.

Los Gatos houses in the 95030 zip code area by quartile:

 

Los Gatos single family homes for sale in 95030 by quartile

Los Gatos houses in the 95032 zip code area by quartile:

 

Los Gatos houses for sale in 95032 area, list prices by quartile.

III. Condominiums and Townhomes for Sale in Los Gatos

Next the list pricing for condos in 95030 by quartile

 

List prices of Los Gatos condos for sale in 95030 area by quartile.

And finally, list prices of condos and townhouses for sale in the 95032 area by quartile

 

List prices of Los Gatos condos for sale in 95032 area by quartile.

In summary, it looks as though condo prices have done fairly well overall. In 95030, they are up year over year across the board, and in 95032 they two top quartiles are up. The entry level condos in 95032 appear to have lost value year over year. The reason may be that buyers in these price points are purchasing single family homes outside of Los Gatos instead.

Among houses, the slippage in pricing is fairly slight in both zip codes among the three lower quartiles, but the market difficulties are much more pronounced among the most expensive homes in both of the Los Gatos areas. The Los Gatos luxury market has taken more of a beating than more midrange homes this year? Why is that? There are a number of possibilities, but the bottom line is that if you are a luxury home buyer looking in the west side of Silicon Valley, this may be a great opportunity for you!

Please call or email me if you’d like more information on Los Gatos real estate market conditions.

 

November Los Gatos Real Estate Market Update

November 17, 2008

How’s the Los Gatos Real Estate Market Faring?

There are many ways of viewing the Los Gatos real estate market. One approach includes looking at the homes which are currently for sale, or the “active listings”. Altos Research, to which I subscribe, uses this data in analyzing the state of things for the realty market in various cities, towns, and zip codes. Today we’ll look at these active listings in all Los Gatos zip codes, both single family homes and condominiums, and view the data by price quartile whenever the trends seem quite divergent from one price point to the next.

Los Gatos Real Estate Pricing for Single Family Homes by Zip Code

First, let’s look at Los Gatos houses in the 95030 area. We’ll begin by viewing list prices by quartile.

Real Estate Market Chart by Altos Research www.altosresearch.com

Except for the highest priced homes, it seems that asking prices are close to flat in this part of Los Gatos. It doesn’t appear to be a market crash when these numbers are viewed.

Next, let’s see how prices are looking in 95032 among single family homes in Los Gatos:

Real Estate Market Chart by Altos Research www.altosresearch.com

Again, it’s fairly close to flat pricing now (after clear declines earlier this year) except in the most expensive homes, which really constitute the luxury or estate market, which looks to be having steeper declines. The luxury market in both 95032 and 95030 appears to be hurting the most.

And finally, the same type of data but for the Los Gatos Mountains (zip code 95033 – this is a broad area which is not actually in the Town of Los Gatos but instead is county area).

Real Estate Market Chart by Altos Research www.altosresearch.com

Interestingly, the luxury homes in the mountains seem to be holding their own better than those “in town”. It appears that all price points in the mountains are doing approximately the same in this realm.

Los Gatos Real Estate Pricing for Condos and Townhomes by Zip Code

The Silicon Valley condominium and townhouse market is often a little different than the market for single family homes, and this is true in Los Gatos as well as in much of San Jose. Below, please note the more chaotic path that pricing has taken in the Los Gatos condo market this year:

Real Estate Market Chart by Altos Research www.altosresearch.com

And oddly, much different in 95032: Real Estate Market Chart by Altos Research www.altosresearch.com

Although these two Los Gatos zip codes are quite different from each other, both have been seeing some rises from a low spot earlier this year. The 95030 prices are higher than they were at the beginning of the year in all quartiles. The 95032 prices are higher for the most expensive condos but lower for the bottom two quartiles. I believe that this is because of school districts – the lowest priced condos (except for The Commons, a senior condominium complex) are most all in the Campbell Union High School District rather than in the Los Gatos – Saratoga High School District. (All of 95030 is in the Los Gatos schools area, and perhaps half of 95032 is in the same district and half is in CUHSD instead.)

Inventory of Los Gatos Homes for Sale

Inventory of Los Gatos homes has been rising in most segments of the market. (There are no townhouses or condominiums in the 95033 zip code.)

Real Estate Market Chart by Altos Research www.altosresearch.com

The lowest priced condos in the 95030 part of Los Gatos seem to be getting absorbed decently – inventory has barely risen there at all this year.

Days on Market for Los Gatos Homes for Sale – All Zip Codes

Los Gatos Houses in 95030:

Real Estate Market Chart by Altos Research www.altosresearch.com

Los Gatos Houses in 95032 are seeing declines in the average days on market:

Real Estate Market Chart by Altos Research www.altosresearch.com

And for condos and townhomes in Los Gatos, 95030, it looks bizarre, with lots of volatility and large ups and downs (not unlike the stock market of late):

Real Estate Market Chart by Altos Research www.altosresearch.com

Lastly, Los Gatos days on market for condos in 95032:

Real Estate Market Chart by Altos Research www.altosresearch.com

So what can we say of the general trends in Los Gatos homes for sale? For most Los Gatos homes:

  • inventory is rising
  • days on market are rising
  • the condo market was faring worse earlier this year, but is improving now
  • the single family home market has been sliding this year, but overall, it has not been steep

How does this compare to nearby areas? The “median market action index” combines the key factors to come up with a market pulse (higher is in the sellers favor, and lower is in the buyers favor). If we look at just single family homes in the two Los Gatos areas plus Saratoga (95070) and the Almaden Valley area of San Jose (95120), it looks like “we’re all in the same boat”:

Real Estate Market Chart by Altos Research www.altosresearch.com

The two Los Gatos zip codes are now in the same place. San Jose is doing a little better and Saratoga better still. But the general trends for almost all nearby Silicon Valley real estate markets is a deepening buyers market.

Please call or email me if you’d like to discuss your particular situation.

Closed Sales of Homes in Los Gatos: Yes, The Numbers Are Down

November 03, 2008

How is the Los Gatos real estate market doing?

For many homesellers in Los Gatos (and Silicon Valley generally), and for their Realtors, the real estate market is extremely challenging right now. Buyers have been wary for many months already, but now they’re concerned about a recession and job losses, not just the possibility of a real estate sales price that won’t hold its value later. It is a deepening buyers market overall, but especially within the market for single family homes.

So what is happening with Los Gatos home sales?

Inventory is rising among single family homes and condos and townhomes. Right now there are 197 single family homes for sale (it was over 200 last week) and 44 condominiums or townhomes. A year ago, it was 113 houses and 23 condos. A month ago it was 184 SFH and 45 condos, and a year ago October it was 104 SFH and 22 condos.

Sales were down in October. We had a surge of sales in September, but then the meltdown on Wall Street happened and buyers put on the brakes. In Oct 2007 there were 12 condos closed, but in Oct 2008 just 9 (and with far more inventory).  In Oct 2007 there were 17 houses closed, but in Oct 2008 just 13 (and again, more inventory).

Buy a home in Los GatosThe real estate market in Los Gatos is mixed, depending on the type of housing (house, townhouse, mulit family dwelling, mobile home or other), the price point (entry level vs luxury), zip code, school district, and more. Of the 13 homes that closed last month, 3 were over $3 million. Surprisingly, 5 were under $1 million. Most often, the vast majority of sales is between $1 million and $2 mil or $2,5 mil, but the middle seems to be shrinking now. It’s a strange phenomena! Low priced homes are being bought because, I believe, buyers can “get into Los Gatos” at great prices. The luxury home market is often independent of financing, so those homes are still selling fairly well (despite the loss of stock value in Google and Apple) for now. The middle price range, which often represents move-up buyers who do need at least some financing, appears to be the most impacted market right now.

 

Condos vs Houses: Which Are Selling Better in Los Gatos?

The Los Gatos condo market, which was really struggling earlier this year, has been improving since May. The Los Gatos single family home market, though, is the opposite: it has been worsening steadily since May. The condo market is very small compared to the single family home market, though, so the overall picture is a deepening of the buyers market in Los Gatos.

Below, please find a bar graph that makes these trends clear:  

Absorption rate among condos and single family homes in Los Gatos, CA (Silicon Valley real estate)

The Los Gatos real estate market is made up of many micromarkets. For information on your particular home buying or home selling needs in Los Gatos, please contact me today.

 

Is The Economic Crisis Impacting Los Gatos Home Sales?

October 25, 2008

Several of my buyers have recently decided to hold off until things calm down with the economy. So I wondered if this was widespread or not. Tonight I checked the sales in Los Gatos (zips 95030 and 95032) for the period of 10/1 – 10/25 this year and last year. Sales are slower than last month but still ahead of last year, generally.

Among single family homes in Los Gatos, there have been 15 homes that went sale pending in that time frame this year, wheras there were 8 last year. For condos and townhomes it was 4 this year and 5 last year – close enough to not be significant in my opinion.

Right now, it does not look terribly bad. Sales are mostly ahead of last year at this same time. That said, we’ll know more when ALL the factors are in – price points, list price to sales price ratio, days on market, etc.

Is the Financial Crisis on Wall Street Causing Fewer Home Sales in Los Gatos?

October 12, 2008

I have never followed the stock market so much as I have in the last two weeks. [My primary concern is my kids’ 529 college savings plan, where the money is all in an index fund (that’s how CA has it set up).]And I wondered if Los Gatos home buyers have their downpayments in stocks and may also be holding back, so I took a look at very recent sales data to see if there are any new trends.

From my initial study of the pending sales in Los Gatos and Monte Sereno in the 95030 and 95032 zip codes, it does not appear that a slowdown in buying is happening over & above what we were already experiencing prior to the roller coaster ride on Wall Street.

sales initiated Houses Condos
10/1/2008 – 10/11/2008 7 3
10/1/2007 – 10/11/2007 7 3
09/20/2008 – 09/30/2008 4 5
09/20/2007 – 09/30/2007 4 4

It may be that we will see a change in the Los Gatos real estate market that later we’ll attribute to the financial catastrophe that is going on, but right now, I’m not seeing it. Perhaps the Los Gatos and Monte Sereno home buyers have their downpayment readily accessible in cash. (That is the case with my buyers.)

Condos and Townhomes in Los Gatos: Market Update

October 08, 2008

The condo market in Los Gatos is improving after a few rough months. It remains a buyer’s market, but not so deep a one as we saw in late spring and over the summer.

Although days on the market for Los Gatos condos and townhomes are considerably longer than they were a month or a year ago (78 days in Sept vs 32 in Aug and 33 a year ago), and the list price to sales price ratio is slipping (96.4% in Sept vs 98.7% in Aug and 99.2% in Sept 2007), there are some signs of improvement. The number of homes on the market is the same, 44, as last month, but the number of closed sales has risen from 6 in August to 8 in September.

Surprisingly, the sales prices are up too (both average and median), both for month over month and year over year. Here are those numbers (care of The Real Estate Report, a subscription I have):

Trends At a Glance Sep 2008 Previous Month Year-over Year
Median Price $850,000 $700,000 (+21.4%) $800,000 (+6.3%)
Average Price $768,021 $619,167 (+24.0%) $741,417 (+3.6%)

And finally, one of the most helpful ways of understanding the market is the absorption rate, which may be calculated as days, weeks, or months of inventory. It’s a reflection of how long it would take to sell off the current inventory if no new homes came on the market and homes continued to sell at the present rate. Below, please find the months of inventory for condos and townhomes in Los Gatos. N that there is recent improvement in the numbers:

Absorption rate for condos and townhomes in Los Gatos, CA (Silicon Valley real estate)

Next, here’s a view of the condo and single family home market of Los Gatos side-by-side:

Los Gatos real estate - absorption rates for single family homes and condos / townhomes.

 

If you’d like more information on how the Los Gatos townhome and Los Gatos condo market are faring, please visit my Real Estate Report for an interactive online report for all of the Silicon Valley real estate market.
Please call me if you’d like a private consultation about your real estate questions, plans, and hopes.


Request an online home valuation from Mary Pope-Handy

 

 

Los Gatos Single Family Home Absorption Rates and Market Conditions

October 07, 2008

The Los Gatos real estate market for single family homes is a bit of a mixed bag, with some indicators more positive than others, but on the whole, it’s a deepening buyers market.

Below, please see the basic sales data on the closed single family homes in Los Gatos for September 2008. Note that saes are up, but days on market are longer, prices are mostly down (except the year over year average sp), and the list price to sales price ratio is dropping.

Trends At a Glance Sep 2008 Previous Month Year-over Year
Median Price $1,205,000 $1,389,980 (-13.3%) $1,280,000 (-5.9%)
Average Price $1,609,960 $1,669,850 (-3.6%) $1,346,230 (+19.6%)
No. of Sales 27 22 (+22.7%) 17 (+58.8%)
Active 170 138 (+23.2%) 106 (+60.4%)
Sale vs. List Price 94.9% 96.5% (-1.7%) 97.6% (-2.8%)
Days on Market 71 51 (+39.0%) 44 (+61.3%)

A good way to judge the market overall is by crunching the numbers to get the months of inventory (or days, or weeks of inventory), also known as the absorption rate. Next, please view the Los Gatos area (including Monte Sereno and some parts of Cambrian Park and possibly Campbell) known as “area 16” in our MLS.  This lines up almost exactly with Los Gatos and the zip codes 95032 and 95030:

Los Gatos single family homes absorption rates January to Sept 2008 (Silicon Valley real estate)

As you can well see, it is going to take more and more time to sell off the current inventory of single family homes in the Los Gatos area. In fact, it is a strong trend that the buyers market has been deepening. The National Association of Realtors says that 6 months or less is a sellers market, but more than 6 months is a buyers market. We had a little dip in May through July where the sellers were under that threshold, but for the most part, it has not been much of a year for sellers in Los Gatos.

In most times, it’s very challenging for buyers to purchase a home in Los Gatos as there are often multiple offers and high demands from the sellers. Buyers, now is your chance to get in at a reasonable time!  Sellers, if you want to sell, make your home gorgous and price it competitively!

To learn more, please visit my Real Estate Report online, an interactive monthly report that provides information for all of Santa Clara County, including Saratoga, Monte Sereno, Campbell, Almaden Valley, Santa Clara, Cupertino, Sunnyvale, etc., and separated by single family homes and condominiums and townhomes.