San Mateo Real Estate Newsletter

.Since both the stock market and home prices hit bottom in December 2009, the stock market has continued to rebound whereas home prices appeared to have recovered slightly and quickly falttened out.

The events of the past few days saw some wild action in the stock market as possible techincal problems and the evetns in Europe spread uncertainty all around. This had led to the real estate and stock market correlating better to one another again.

The sale Price for all San Mateo County Single-Family Homes vs. the Dow Jones Index monthly average

SAN MATEO COUNTY
INVENTORY , CLOSED SALES, NEW LISTINGS
& DAYS ON MARKET

San Mateo County’s real estate market remains precarious. The number of single family homes sold in April are up by 17% over last year (344 v 294 homes), however new listings have also increased for this time of year by about 7%. The increase in new listings had led to a growth in inventory. Currently our inventory is about 4% higher then this same time last year, the good news for sellers is that it is still about 5% lower then April 2008. Bottom line, we remain in this rut of only selling about 60% of the new listings that come on the market and I think that we have yet to see much of the inventory that the banks own being put on the market.

Market uncertainty is present even in safer towns like San Carlos where inventory is creeping up. This backs up the stories I hear from other agents, that their buyers don’t like most of what they are seeing for sale, but the nice turnkey homes can move fast and with multiple bids. Buyers are choosing the few, well priced quality homes that are on the market and are not willing to settle for mediocre properties.

While the situation is overall better then the circumstances of 2008 when the market was crashing, we seem to have only a very precarious stable market. In the past few months where we saw average home prices increase, those homes were on average larger and sat on larger lots. Much of price increases are typically due to luxury properties beginning to sale as jumbo loans have started to reappear.

The reason I caution that this stability is precarious is that in my opinion there are far more catalysts for a downside then upside. Our stock market jut scared the hell out of everyone, many government employees and teachers are about to loose their jobs, interest rates can only increase eventually, State taxes may increase more to get us out of the fiscal mess we’re are in, and even those that can afford more expensive homes are way too nervous to buy up.

When I try to think of reasons to argue that the real estate market can only improve or at least remain stable, I can only scratch my head. The one positive comment I can make is that we survived 2008 and unlike the Stock Market, real estate prices did not rebound as much as the equity markets. Hopefully, this means that the real estate market has found a sustainable support level?

	Current Inventory	Closed Sales	New Listings	Sales YTD	Listings YTD
This Past Month	1,798	344	782	1,124	2,543
Decade Average	1,329	443	766	1,417	2,588

SAN MATEO COUNTY Graph 1 plots monthly Inventories, Closed Sales and New Listings. This graph is an excellent visual for determining the strength of the real estate market. The graph plots how over the past few years Inventories had been rising as New Listings remained fairly stable and Closed Sales keep decreasing. However, 2009 was a turn around year for inventory decreasing.	Graph 1—Monthly Inventories, Sales and New Listings for Single-Family Homes in San Mateo County

SAN MATEO COUNTY Graph 2 looks at the same type of data as Graph 1, but it compares it from a seasonable point of view. It compares the numbers for the identical month over the past decade.	Graph 2—Inventories, Sales and New Listings for Single-Family Homes in San Mateo County for a given month

SAN MATEO COUNTY Graph 3 is a cumulative look at Year-to-Date statistics for Closed Sales vs. New Listings.	Graph 3—Total Single-Family Homes Sold & New Listings Year to Date in San Mateo County

SAN CARLOS
INVENTORY, CLOSED SALES, NEW LISTINGS

The average days on the market (DOM) for homes that closed escrow in April 2010 was an amazingly low 27 days, however the homes still actively for sale have been on the market for 66 days. While there were only 20 homes sold in San Carlos in April 2010, there were 47 new listings and currently there are 57 properties for sale. While it’s not unusual for new listings to outpace sales by 2-to-1 in April, it is unusual for it happen with this much inventory on the market. San Carlos real estate did not suffer the same devaluation as the surrounding communities, but the current trend between new listings and anemic sales does concern me.

Average Monthly Stats for Single Family Homes in San Carlos

	Current Inventory	Closed Sales	New Listings	Sales YTD	New Listing YTD
This Past Month	78	20	47	56	133
Decade Average	66	31	50	98	167

Average Monthly price for Single Family Homes in San Carlos

Monthly Inventories, Sales and New Listings for Single-Family Homes in San Carlos

San CArlos real estate inventory history

Month over Month comparison of Inventories, Sales and New Listings in San Carlos	Year to Date Closed Sales and Listing in San Carlos

REDWOOD CITY
INVENTORY, CLOSED SALES, NEW LISTINGS

Redwood City’s real estate market tends to mimic the over San Mateo County market and continues to do so. In 2009, Redwood City’s home inventory was about 20% lower then the spike we saw in 2008. However, this reduction was greatly due to far fewer properties coming on the market then what would typically be considered ‘normal.’ This year we are trending towards a ‘normal’ number of new listings coming to market, this trend is feeding inventory which is not being reduced due to slow sales. If such a pattern continues, prices might remain somewhat stable, but we are still in dangerous territory in regards to a stable market.

Average Monthly Stats for Single Family Homes in Redwood City