We’ve got bidding wars, outrageously high sales prices, record low interest rates and we have memes comparing homes to apples going viral. What does it all mean? Is the housing market showing any signs that could point to a slowdown?
As of April 28th, there were 649 homes, condos & townhouses available for sale across the city of San Jose. In March, there were 578 active listings. As to be expected during this time of the year, we are seeing an increase in the number of homes coming to market, which is good news for those looking to purchase as increased inventory leads to increased choice for buyers. However, when compared to a year ago when there were 810 homes for sale, buyers today have 20% fewer homes available for them. Hopefully, as we head closer into summer, we’ll continue to see an increase in homes coming to market.
Now, to get a general sense of whether the market is moving quickly, or slowing down, let’s check out how buyer demand has been behaving lately.
In April, there were a total of 997 homes, condos & townhouses under contract of sale. Compared to March, when we had 836 listings under contract, indicating that demand is not showing any signs of slowing yet. And, with pending contracts still outpacing inventory levels, the market is moving VERY quickly and continuing to favor those looking to sell, as home prices tend to rise when inventory is gobbled up by demand.
To give you a better sense of just how quickly our market is moving, if no new properties were listed to the market, we’d run out of inventory to sell in less than 30-days! But just how quickly are prices on the rise from the imbalance in supply and demand? The median sales price is currently hovering around $1,212,000 up 3.0% from March, and up 19% year-over-year.
The last market indicator that we track, is the sales-to-list-price ratio, which is the difference between the price that a home sells for versus the price it was listed at. This statistic provides us a glimpse into what buyers and sellers can expect when negotiating on a home’s pricing. In April, the average sales-to-list-price ratio ran at 109%, slightly up from the ratio of 107.5% in March, we’re continuing to see buyers offer much more than a home’s listed price, indicating increased levels of competition.
The bottom line
It may be easier to sell houses in San Jose than apples! We are continuing to see inventory levels struggle to keep up with demand, which is being fueled by record-low interest rates. This is resulting in the majority of homes for sale selling well above the asking price, within 7-10 days on market, and with multiple offers!
- If you’re looking to buy now, you’ve got your work cut out for you.
- You should have your pre-approval completed, or, better yet, ask a lender to fully underwrite your application in advance
- Be prepared to make several offers on numerous properties
- And, do your homework, or work with an agent willing to scope out the competition on your behalf
- If you’re looking to sell, the market is favoring you, but it doesn’t mean that we’re not seeing homes that don’t sell
- Be sure to price your home correctly and competitively
- Take time to thoughtfully prepare your home by completing some maintenance or even cosmetic updates, especially if you want very favorable terms
- If you do this, then you’re likely to sell quickly with multiple offers