Silicon Valley Housing Inventory Expands

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By Neil Gonzales

Inventory has grown in the still-steaming Silicon Valley single-family housing market. But don’t be fooled.

“The increase certainly is partially seasonal,” said Jeff Hansen, a Campbell-based agent with Keller Williams Realty. “But don’t take it as a sign that it’s a buyer’s market.”

According to the MLSListings report for April, inventory in Santa Clara County reached 2,264 houses on the market—up 9 percent from March and 44 percent from a year ago. That’s a huge jump “in an area that has been struggling recently with low inventory,” the report said.

Inventory typically picks up toward the spring and summer as people return to the market wanting to sell following the winter seasonal downtime, Hansen said.

“It’s a transition period,” said Joe Garcia, broker and owner of Camino Real Realty in Santa Clara. “Kids are out of school, and this is the time to make a move. So the market is going to see people who want to move, sell and buy another home.”

In San Mateo County, the 860 houses on the market represented an inventory dip of 3 percent from March but was still an increase of 34 percent year-over-year, according to the report.

The expanded inventory could signal a general leveling out of median home prices but “shouldn’t slow down Silicon Valley’s growth as the market saw increased closed sales, more total dollars sold and shorter days on market in April,” the report said.

Although the rate of appreciation is projected to ease up compared to past recent years, local real estate experts say, the general outlook for the rest of 2015 is that median prices will continue to rise and possibly surpass the $1 million mark in Santa Clara County.

“It’s still going to go up but not as rapidly,” Garcia said.

Part of the reason for the slowdown is mortgage interest rates creeping up, Hansen said. Still, he believes Santa Clara County will reach the $1 million milestone.

According to the MLSListings report, the median price in Santa Clara County was $965,500 in April—up 3 percent from March and 7 percent from a year ago. San Mateo County has already exceeded the $1 million threshold, climbing about 25 percent year-over-year to $1.3 million.

Homes in Santa Clara County are selling nearly 8 percent over the list price on average, Hansen added. “That’s the highest I’ve ever seen in the county,” he said. “It’s pretty incredible.”

Among other signs indicating the housing real estate will remain robust for the foreseeable future, he noted that the market is also still seeing plenty of multiple offers, lots of all-cash deals and a hefty flow of investment capital coming from overseas.

Photo courtesy of Pixar/Disney

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