CoreLogic DataQuick, the La Jolla-based real estate information firm, reported that Bay Area home sales overall edged slightly higher in October, climbing 1.3 percent from a year ago. But the luxury segment of the market turned in a much more robust performance, soaring by as much as 55 percent in some regions, according to new Coldwell Banker Previews luxury market reports.
Marin County led the way in the high-end segment of the market, with 62 luxury sales over $1.5 million, a 55 percent increase from the same period a year ago. The county also recorded 38 sales over $2 million during October, double the number from last October. All other key indicators were strong as well with homes selling faster and at a higher percentage of list price on average.
Luxury sales also continued their torrid pace in Silicon Valley with 222 homes over $1.5 million changing hands, a 41 percent increase from a year ago. There were 109 sales over $2 million and 28 sales over $3 million, both figures up substantially from last October.
And finally, the booming luxury market continued to spill over to the East Bay, where million-dollar home sales were up 46 percent in the month and the median sale price of luxury homes jumping 13 percent. Sales of $2 million homes were also double the number from last year.
Our East Bay offices are seeing many more buyers crossing the Bay Bridge in search of more affordable prices compared to San Francisco and the Peninsula. And that’s serving to make Oakland and other parts of the East Bay perhaps the fastest growing luxury market in the Bay Area.
To be sure, the luxury market in the East Bay and all around the Bay Area is showing no signs of slowing down as we move toward the end of the year.
Demand for well-appointed, fairly priced high-end homes continues to outstrip supply. With a strong Bay Area economy, a growing number of highly compensated tech employees and other knowledge workers, and a limited supply of housing, there are just aren’t enough properties to go around. It’s as simple as that.
Below is a market-by-market report from our local San Francisco Bay Area offices:
North Bay – Greenbrae agents are definitely seeing a seasonal slowing in both open houses and new listings, yet the closings are still coming through. Our office had 11 closings the day before Thanksgiving ranging in sale prices from $430,000 to $4,250,000. Agents are seeing more properties fall out of escrow and more sellers who are unrealistic about the market value of their properties. Our office just closed a $4,250,000 listing the day before Thanksgiving. But the Previews Market is seeing a bit of seasonal slowing. The Sonoma County market is at 1.7 months of inventory and falling, according to our Santa Rosa Bicentennial office manager. The seasonal decrease in listings has outpaced the seasonal drop in buying activity putting further pressure on an already stressed inventory. The high-end second home market does not appear to be affected by the winter slowdown. All-cash buyers in the $4-$8 million range are still actively looking. Our Santa Rosa Mission office manager says the market is active, with surprising demand still. Multiple offers are increasing as inventory diminishes – a surprising number of multiple offer situations for this time of year. Our Sebastopol manager reports that the seasonal slowdown kicked in this last period. Open houses were more lightly attended then past weeks and sales were dramatically fewer.
San Francisco – The pace of new sales picked up over Thanksgiving, according to our Lakeside office manager. This is a little unusual traditionally and even more so in light of the drastically shrunken inventory. There are multiple offers on most properties but the overbids have been more modest. Though many people are swiftly moving into “Holiday Mode,” the few sellers with their homes on the market are being rewarded with multiple offers, reports our Market Street office manager. Agents representing buyers are experiencing deals that had as many as 38 offers during this period. And one of our agents offered on an $800K property that reportedly went for nearly $1M over asking. With so little available inventory, even properties that had gone ignored are seeing busy open houses after weeks on the market. Our Sunset office manager says listing inventory took a dive during this holiday period. There are still plentiful of Buyers shopping for the right property at the right price. Overall, the market appears to be slowing as fewer and fewer properties are coming on the market.
SF Peninsula – There are ready, waiting buyers to scoop up the few new listings that are coming to the local market, according to our Burlingame manager. December is a great time to be a buyer if only there is a home to buy. Hillsborough has 27 active and 10 pending listings currently. This is a very low inventory but highly reflective of the end of year, Holiday Season. There are some wonderful listings waiting for the early spring selling season. Over the past two weeks, there were 185 ratified sales of SF homes and condo/townhouses in all of San Mateo County, our Burlingame North manager reports. There were four ratified sales over $5 million. While the average sales prices declined in most areas during the third quarter, significant overbidding has reappeared again and prices are rising quickly. Inventory is as low our manager can ever recall and it appears that buyers are still in or entering the market despite the upcoming holidays. Our Menlo Park manager said there’s been a couple of sizeable sales in the Preview luxury segment of the market, but inventory is almost non-existent. It’s a very slow time, according to our Redwood City-San Carlos manager. The inventory is at an all-time low – the combination of the holiday season and the general lack of inventory. It’s creating an extremely challenging market. Our Woodside-Portola Valley office manager says agents had some good high-end sales the last 3 weeks but it’s very quiet now with no new inventory.
East Bay – Our Danville manager says inventory is disappearing, but Buyers are still active and she has seen sales and multiple offers already in December. Our Walnut Creek manager reports very low inventory. With rates still low, buyers are ready to buy but there’s virtually nothing to sell.
Silicon Valley – It’s remaining busy out there, our Cupertino manager reports. Inventory is dropping like a rock and most buyers have lots of competition. Inventory in Palo Alto, Mountain View, Los Altos, and Los Altos Hills is less than 2013 for the same month, and about 20% less than last month, our Los Altos manager reports. In the last 3 weeks, four Previews properties in Los Altos Hills that have been on the market for over 3 months are under contract. One Previews property over $4M in Los Altos that has been on market over 6 months is also pending. There’s still big pent up demand for any inventory under $2M in single family, and all condos. There are new highs in sales in all these areas still, although the number of offers in multiple offer situations is lower. Our Los Gatos manager says buyers continue to compete over a very limited amount of inventory. Low interest rates and high buyer demand continue to drive the market. Our San Jose Almaden manager said listings and sales are decreasing with the Holiday Season upon us, which is normal this time of year. The local Willow Glen market continues to experience contracting inventory. At one point during the week the active listing count went below 35, a record low for inventory for this area. There is still strong buyer demand. Open house traffic has been steady. The new open sales are just trickling in this past week. Our Saratoga manager said activity in general is HOT. Inventory is less then it was at this time last year and last year was all time lows. There is still pent up demand. Sellers seem to be holding off for the time of year reasons that we normally experience. He said people are “not buying houses any longer, they’re buying schools.” So, those areas with the best schools are white hot. As prices rise, people are digging into areas of Cambrian, Campbell and even Blossom Valley for the homes that have the higher API scores, he said.
South County – Most South County agents can agree that the market has taken a “seasonal siesta”—with very sluggish sales and listing activity. In addition to the impact of the holidays, another more serious factor that is affecting the market is the lack of affordable inventory. In Morgan Hill (as of December 2) there were only 62 single-family homes on the market AND 30 of those properties are listed for over one million dollars. That translates to just fewer than 50% of all homes available. In Gilroy there are 82 single-family homes with “active” status and 29 of those homes are priced over one million dollars (36% of all inventory). The fact that there is very little inventory coupled with very high prices certainly limits a buyer’s choice and ability to purchase. One positive factor, however, is that interest rates remain very competitive and buyer demand remains high.
Santa Cruz County – The inventory of homes on the market is low and demand is staying strong even during the holiday and rainy times. Homes priced well may receive multiple offers and the affordable price range is very competitive. The market should stay quite active during the winter as interest rates remain attractive and sellers continue to experience appreciation in value, according to our local manager. Homes over a million dollars near to or on the beach are still receiving showings and are going pending within a relatively short amount of days on market, especially if they are priced well and/or offer unique features.
Monterey Peninsula – November sales and units continued to trend upward over November 2013 and October 2014. You can say that we are in a “Bull Real Estate Market” on the Monterey Peninsula with vacation homebuyers making some significant purchases this month, according to our local manager. Agents are continuing to see out-of-area buyers purchasing vacation and future retirement properties of significance. The trade up buyer is moving up to the million-dollar price point for the Carmel and Pacific Grove school districts. Bay Area buyers are starting to take note of the value for the dollar vs. what they can purchase in their own area. The holiday season is upon us, and agents are hoping this momentum continues into the new year.
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