Saturday, July 12, 2008

Here's another great article from Yahoo Finance talking about how real estate in high-end communities is doing very well in contrast to the rest of the area, state and country.

http://biz.yahoo.com/bizwk/080710/jul2008bw2008078555230.html?.&.pf=real-estate

Los Altos Hills is mentioned but not Los Altos itself which is a big mistake on the reporter's part as Los Altos is doing very well so far this year.

Friday, July 11, 2008

Strong areas doing well - yeah Los Altos!

I like this article that Sue Macallister had in today's SJ Mercury News. She points out that high demand areas as seeing no price declines or actually going up (as Los Altos has) and that the drops everyone keeps hearing about come from other areas.

http://www.mercurynews.com/business/ci_9848725

The article fails to be specific about the areas that have seen the greatest declines. They are where first-time homebuyers were getting into homes they couldn't really afford (no matter how low the price seemed). Those areas typically have prices in the $500-700K range, have fair school districts and suffer other issues.

Los Altos is a prime location. Inventory has fallen in recent weeks and continues to stay relatively low. Well priced homes sell fast and go over their asking prices. A good example is 295 Vernal Court in North Los Altos. It sold after one weekend on the market and for nearly $100K over the asking price.

Tuesday, July 1, 2008

Los Altos & Hills Prices Up - SJ Mercury 6/29

As entertaining as it is to get clients who ask about declining prices and the search for bargains in Los Altos, I offer this article as further evidence that no such declines have occurred or are likely to occur.

http://www.mercurynews.com/wherewelive/ci_9735111

I'm not trying to make it sound like it is impossible for prices to drop in Los Altos or that getting a "good value" is equally difficult. What I keep trying to reinforce is that sales volumes have stayed low and that low supply combined with strong demand continues to push prices up.

You will see lots of price reductions on homes that have been on the market for a while. This is almost always the seller having unrealistic expectations of what their home is worth and an agent who won't push back. The homes offer an opportunity to get a "good value" by making an offer at or below the asking price.

Tuesday, June 24, 2008

A word on price drops...

After listening to the myriad buyers who have come through recent open houses looking for "bargains", I think it's time to clarify the Los Altos (and Los Altos Hills) markets. There are NO bargains in this area! I say that firmly so that those who will actually listen understand that this area is NOT SAN JOSE! The average selling price in Los Altos went up 9% last year and over 4% so far this year.

Now, I will tell you that there are some GOOD VALUES in the Los Altos market but there's a difference between value and bargain. The key is understanding that the "market value" of a home is what someone will pay for it, not what a seller wants to sell it for. When you see a home that starts at $3.5M and then ultimately sells for $3M it's primarily because the seller had high expectations and overpriced the home. A well priced home typically sells quickly. A high priced home will sit on the market for weeks or months and finally sell and the "market value". Most homes in Los Altos are priced well and sell quickly. The exceptions are homes are the very high end (over $4M) which typically take longer to sell.

So, if you're out looking for a home and frustrated by being outbid (multiple offers are still common) and an unwillingness of sellers to reduce their price, then bear in mind that inventory is very low in Los Altos, demand is high, and prices continue to rise. Find the best home you can afford and get in as soon as possible.

Tuesday, May 6, 2008

SJ Mercury article on Zillow market trends

In today's SJ Mercury News (www.sjmercury.com) there was a story on the drop in area prices and how Zillow offers a tool to track the changes over time. While the story was focused on the negative aspects of the market, it completely failed to point out the areas where prices have risen. One town enjoying another year-over-year gain in average sales price is... LOS ALTOS!

In the data offered by Zillow, Los Altos has seen a 3.2% average sales price increase in 2008 vs. 2007. Assuming that the data only reflects the first 4 months of the year (Jan-April) that translates to an annualized increase of 9.6% which is about what the increase was for Los Altos last year! That tells, and should tell my readers here that Los Altos has been and continues to be a strong market.

For buyers, you can feel confident that your investment will increase in value. For sellers, it ensures plenty of demand and a fair sales price.

Wednesday, April 23, 2008

March Statistics



Click the image to enlarge and see details.

I'm a little late to the game with these but better late than never. The trend is higher inventory, year over year, but with higher prices in general. There is also more inventory in the $1.5-$2.5M range than there has been in the last year. This means sellers of homes in the higher price ranges have less competition and a better shot at getting their asking price or higher. It also means that sellers in the $1.5-2.5M range are seeing more interest (more potential buyers) because there is more to chose from. Even more interesting is that Average Days on Market is down substantially from last year. The key to remember is that if you like a home, more fast.

Thursday, April 17, 2008

Homes are selling and there is some weakness

My projection of selling 10 homes last week was close. There were 9 homes in contract and a handful of new ones came on the market. What I'm seeing with buyers is an expection that prices should drop. The appearance is that they are dropping but in reality, homes that were overpriced are simply coming back down to earth.

A recent sharp drop in price was at 1084 Parma Way. This is a nice house but they had a $400K price drop from $3.195M to $2.795M. Why? Good question. But I am seeing a few homes where sellers don't have the time or patience and they drop the price on their property substantially to drive a sale.

I've seen this in Atherton a lot lately. A one acre lot in a nice location sold at just under $2M in 12 days when it was priced at $2.2M. Why? Just to get it sold.

This actually hurts the market for sellers and potentially buyers because we really want to maintain a balanced market. If the market is weak on the buy side you might get a deal, but when it comes time to sell your own home to buy the new one, you'll take a hit on that sale. strong demand and reasonable pricing will help keep the balance and be a win-win for everyone.

Friday, April 4, 2008

What's Moving - What's Not

The old saying goes, "location, location, location" and this still holds true in the current market. the mitigating factor is also price.

There are currently 64 homes on the market and most of those are priced under $2.5M. Homes are not moving as fast as I would have expected but I believe that's due to current press about the economy and less about Los Altos in general. I will make a predication that the market sees at least 10 available homes get offers by next Friday. There are too many good opportunities out there to pass up.

Monday, March 31, 2008

Inventory update

Inventory in Los Altos is at 60 single-family homes which is low for this time of year. There have been a significant number of homes listed under $2M (older homes) and a handful of homes listed at $2.8-3.5M that are new.

This is up only slightly from last week (55 homes).

Friday, March 28, 2008

An update from Randall Hull

We had a presention at the local realtors broker meeting from Randall Hull of the Los Altos Planning Commission. He had a chance to outline some of the recent changes in the downtown building codes (previously discussed here) as well as the new building going up at the corner of Main Street and San Antonio.

This new 2-story building is envisioned to have retail (preferably a "hot spot" where people can "see and be seen") on the ground floor and office space upstairs. The commission hopes that the developer will break ground this spring.

Randall also pointed out that the city council will vote to remove a restriction on the lot at First and Main (along Foothill) that could only be used as a hotel. Once that restriction is removed, the property could be any of several "mixed use" options.

The post office downtown does not currently have a "home" to relocate to once they begin reconstruction. Options are still be explored but at this point it may be down to operating out of trailers. I'll keep you posted on that.

Monday, March 24, 2008

Multiple offers are still the rule, not the exception

For those who doubt that this area is still very much in demand, let's review a few recent transactions:

Spencer Court: 16 offers
Berry Ave: 3 offeres
Stanley Drive: 2 offers

just to name a few...

The point is, Los Altos does not have the same issues the rest of the country or the general area have with price erosion and drops in demand. Homes are still selling quickly, most in the first 2 weeks they're on the market. Those that don't sell right away are typically sold reasonably close to their asking price or at a price consistent with the dollars-per-square-foot for their neighborhood.

The key to getting a home is to be prepared. You have to know what you want, what you're willing to pay, which neighborhood(s) you want to be in, and if you'll have a contingency (selling an existing home). If you have a home to sell, do so FIRST! Get your home ready and put it on the market before making an offer on another home. That way, you have less risk of losing the deal.

Here's why this is important. If you make an offer on a home and the sellers accept it, you're in contract. However, until you release the contingency (sell your existing home) the new home will show as "Pending Release" in the MLS. That means that the sellers can take other offers and if they get an offer they like, they can tell you that you have 3 days to release your contingency or forfeit your offer. If that happens and your existing home isn't in contract with someone else, you most likely will have to forfeit your offer and lose the new home.

This is less of an issue if you're downgrading from a more expensive home to a less expensive home or selling a home in a high-demand area (Los Altos, Palo Alto, etc). No matter what, you should be prepared.

Saturday, March 8, 2008

Buzz from the open houses and tour

There are several new homes in the $2.5M to $3.5M range that have come on in the last week particularly the two homes on Riverside Drive. These are both new homes just recently completed. What I'm seeing in the market are several homes in good locations with good floor plans, good lot sizes, and large enough for a big family. Most homes that are coming on are selling relatively quickly with 2-4 offers, mostly cash or all cash, and no contingencies.

The foot traffic at open houses in the area has been strong. I've spoken with several agents who see 30-40 people through their open houses in recent weeks on each day. Contrary to the media, the market is strong in Los Altos because we have very little inventory (only 37 SFR homes in Los Altos as of today).

Will It Finally Sell?
One home that has been on the market a while is on Estate Drive. This home has received four previous offers that have fallen out of contract. Hopefully this time, the fifth, will be the real deal.

Politics
Unfortunately, I have to report that my run for the Los Altos Planning Commission was unsuccessful. The position went to Mike Abram. I wasn't surprised but a bit disappointed. That said, there's always next time.

Downtown Real Estate
Yves de Lorme is not moving down the street to the former Los Altos Camera location. Their corporate headquarters decided that such a move, in the current economic climate, was unwarranted.

Easter In Los Altos and Other Downtown Stuff
As many of you know, we have two big Easter events in Los Altos. The egg hunt by the Chamber of Commerce and the egg hunt and craft event by the Los Altos Village Association (LAVA). New this year will be the addition of a ride to LAVA event, sponsored by local businesses.

The final line-up of movies has been selected for this years Movie Night series downtown. The collection includes a lot of recent box-office blockbusters and Disney/Pixar flicks from 2007. If you haven't been to Movie Night, you should. The downtown area really comes alive.

Friday, January 25, 2008

Busy, busy, busy

OK, I apologize for such a large gap between posts. The market has been very active which means I've been really busy.

Los Altos Is A COOL CITY!
On Tuesday night the Los Altos City Council voted to have the mayor sign the US Mayors Climate Protection Agreement which has been signed by nearly all of our neighbor cities. The council also agreed to spend $15,000 on a study on Los Altos use of energy and other resources. The purpose of agreement and the study will be to enable Los Altos to take a leadership role in conserving resources, saving money, and protecting the environment.

For more information on the Cool Cities initiative go here http://coolcities.us


Market Update
Several homes that have come on the market sold quickly including 11 Middlebury and 1509 Country Club Drive. Both sold with multiple offers after their first weekend open. Middlebury was on at $2.3M and probably sold for $2.4 or $2.5. Country Club was on for $2.2M and probably sold for $2.2M or maybe $2.25M.

Inventory is still low with only xx homes on the market. We should see another 5-6 homes come on the market this coming week pushing our available homes up to the low 30s. Open house activity has been brisk. The new home on Guadalupe had over 50 visitors on Saturday. My open house on Stanley had close to 20 visitors (not including neighbors or agents) over the weekend.

The two newest listings are 287 Marich Way ($2.2M) and 556 Cuesta Drive ($1.4M). Marich has seen a lot of activity in the last year including two sales in the last 2 months. Cuesta should sell quickly since it's in the "sweet spot" of Los Altos locations and price.

Downtown Events and Openings
The Los Altos Village Association will launch the Los Altos Valentine's Experience next week. This is your chance to "buy local" and get your sweetheart a first-class valentine's surprise with goodies from town. Look to next weeks Town Crier for details.

Also, last Friday the new restuarant, L'Acquolina, opened at First and Main Streets. This new hotspot features regional European cuisine (northern Italian / southern French), a great atmosphere, and exceptional service. The owner and head chef, Fernando Urroz, is highly regarded for his work at Tre Scalini and brings those talents to Los Altos. Stop by for dinner as soon as you can.

Thursday, January 3, 2008

Happy New Year! Hot Market Coming!

The final numbers are in and the average sales price of a single-family home in Los Altos rose 9% in 2007. For those buyers who are waiting for a price drop, stop waiting. Prices will continue to rise in 2008. I'll make my estimate now that prices will rise 5-7% in 2008.

Why are prices so high and still rising when the rest of the Bay Area is dropping or holding steady? Simple - demand. There are effectively 19 houses on the market and only one that I know of coming on next week (there will probably be another 4-5 new listings next week). However, there are dozens of buyers looking for homes here because of the excellent schools and overall quality of life.

What hasn't sold are homes that are overpriced with stubborn sellers. Sellers will often have an idea of what their home is worth and will hold firm regardless of what else happens. Getting a home with a stubborn seller is difficult, if not impossible.

Most of the other homes that haven't sold are in poor locations or offer little room for improvement (small lots are a challenge).

If you plan to buy, do so before the end of February because March onward is when the buyers swarm and multiple bids occur. If you plan to sell, it isn't a bad time to list because there are a LOT of buyers out there.