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June 08, 2008

One of the benchmarks realty professionals use in determining the answer to the ever-present question of “how’s the market?” is the absorption rate, or months (or days or weeks) of inventory. The question is this: if no new inventory were to come on the market, how long would it take for the current number of listings to be absorbed by buyers?

A look at the single family home situation in the town of Los Gatos reveals an improvement over recent months. Is it possible that we’re near the bottom of the market? Maybe.

Months of inventory in Los Gatos from May 2007 to May 2008

This graph presents broad strokes in a market comprised of many micro-markets. What is happening in Blossom Manor may not be the same thing happening in the Edelen District or what’s going up in the Aztec or Maya areas, in the Sierra Azule section of town or Belwood or Bicknell Road areas. The home offered at $950,000 in the Union School District is not really “the same market” as one worth $2 million with Los Gatos schools – there are nuances that can totally change the picture!

For more information on the overall Los Gatos real estate or the market in other Silicon Valley areas such as Saratoga, Campbell, San Jose, or the many districts within San Jose such as Cambrian Park, Almaden Valley and Willow Glen, please visit my Real Estate Report online. From there you can get market statistics and trends as well as an analysis of your own home or another in the area.

To learn about your own home or area, please contact me. Or if you’d like a complimentary market analysis, request one from me at or simply call or email me with the details of your home. Please allow 24-48 hours for me to run the numbers for you.