Local Housing Market: What Do The Numbers Mean?

The local housing market began to slow down after the summer rally, with Los Altos seeming to do better than the higher-end market of Los Altos Hills, according to the latest home sales report.

Last month 27 single-family homes were sold in Los Altos. It is 45% more than the same time last year and was the same as the previous month. The median home price was $1,502,485, which is 2% more than last year but is lower by 9% from August.

During the same period of time, five homes were sold in Los Altos Hills, compared to seven and 11 homes sold last month and the same month last year. The median home price also dropped from $2,540,000 last year to $2,060,000.

The average day on market (DOM), another important indicator, also points to a market slowdown. In September, the average day on market went up greatly in both Los Altos and Los Altos Hills.

In Los Altos, it took an average of 45 days to sell a home, compared to 29 days the month before. In Los Altos Hills, the average day on market was 120 in September, up from 49 from the month before.

The rise in the average day on market clearly suggests a change of the market dynamic, with buyers feeling less urged to act. But the slowdown could have just been driven by a seasonal change of demand. There are usually more buyers looking before and during summer for school reasons; and those who want to move in before school begins in general are more motivated.

Despite the apparent slowdown of the market, it is important to point out that the percentage of list price received, which tells us how much buyers paid in relation to the asking price, is pretty much the same as the month before. This suggests that the market remains in good balance despite the seasonal drop in demand.

It's also worth mentioning that after a drop in August, inventory did go up in September in both Los Altos and Los Altos Hills. Hopefully it will have a positive impact on the sales next month.

The local housing market is indeed facing lots of challenges in light of the economic uncertainties. While market indicators suggest a slowdown, at least part of it is seasonal in nature. 

With the mortgage rates remaining at historic lows, and Los Altos/Los Altos Hills continuing to be one of the most desirable neighborhoods in Silicon Valley, I remain confident on the long-term prospect of the market. I think the local market will remain stable in the next couple of months, before it may slow down more toward the holiday season. Stay tuned for more!

September 2011 Home Sales Statistics

Single Family Residences

City

Sales

Change from last year

Average Day on Market

Median price

Change from last year

% listed price received

Los Altos

27

42%

45

1,502,485

2%

98.02

LAH

5

-29%

120

2,060,000

-19%

95.83

Source: MLS Listings

Information deemed reliable but not guaranteed.

Winnie Yip Fong, a Los Altos resident and a local realtor, prepares this monthly home sales report to keep readers updated on the local housing market. Email her at winniefong.realestate@gmail.com for any suggestions or comments. You can also follow her on www.twitter.com/SVHomes for more local real estate updates.