McKae Properties Real Estate Market Commentary

 As we have moved through the shut down, movement out of the state and cities single family homes have remained in a "seller's market".  It did not matter if prices were cut homes sold quickly indicating a seller's market.  That condition did not only exist in Silicon Valley it existed throughout the United States. As we progressed through the summer, "The Zillow Market Reports" had low to negative forecasted market values.  Those reports were focused on zip code areas.  The zip codes price values indicated the future price movement based upon current sales. Those prices values are now seeing price increases over the former forecasts. 1. 94061 one year forecast +3.5%, 2. 94061 + 3.2%, 3. 94020 +6.0% (fires be damned: price and quality of life are the winners), 4. 94062 +2.9%, 5. 94027 + 1.7%, 6. 95125  +2.1% As a result here are the sales in San Mateo and Santa Clara County as of September 26th. RESULTS . Sine the beginning of the year home prices in Califor

 I have watched with amazement on how vibrant the real estate market has been in the Luxury level.  (That level being everything over $1 million.)  So when the recent issue of the September 2020 Luxury Market Report came across my desk from the Institute for Luxury Home Marketing I took it up with abandon!   In hopes that I could get some idea of why and where we are going in the Luxury Real Estate Market for myself and my clients.  As you click on the hyper link previously you will note that the entire United State has a commonality of performance, Sales price less than List price but short days on the market.  The Days on the Market indicating a "Seller's Market"!  Irrespective on a sale less than the list buyers were active to jump on price cuts to obtain the house they desired.  The first part of the Report will explain the difference between "buyer's market", "seller's market" and "balanced market".  Then comes the premise of th

I needed a break to review our present situation and look at the various forecasts for real estate values.  The markets I follow indicate to me acceptance of buyers at levels below what has been posted.  The cuts represent the buyers reluctance to accept the idea that prices are going higher.  The buyers do want homes in areas that require move in condition and conditions that they are looking for based upon today's buyer's attitudes. The comments below are those from 2 weeks ago when I decided to stoop and re-evaluate. After the remarks I will post my closing comments based upon my research. TWO WEEKS AGO:  With the movement out of San Francisco and New York City and if we are to believe the media, out of big cities.  Where are they going? Redfin has a great site for those of you who like to do some research in price and market analysis redfin.com/blog/data-center. In the San Jose Silicon Valley market center 77.8% of the searches are within the Bay Area.  22.2% elsewhere with

 Two places I enjoyed living in my youth was New York and San Francisco, or "The City" as it was called.   Lord Toynbee wrote the HISTORY REPEATS ITSELF.     So have no fear.  What we see happening will create opportunities   New York went Bankrupt and the US bailed them out with muni bonds referred to as Big Mac's  For Municipal Assitant Corporation.  New York cleaned up their act and it became the destination spot of the world.  Have no fear it will happen again. The same is for San Francisco.  I came there in 1983 bought a flat in Pacific Heights out of foreclosure and fixed it up and 11 months later sold it for $110,000 more and bought in Woodside at same sales price of SF but $225,000 less than list.  The place in SF is worth more now than the place in Woodside. New York is a repeat of last weeks article on SF: 56% fewer sales compare to a year ago, 30.8 months of supply and 11.3% discount from list.  West Chelsea built a high end boutique condo known as the Getty an

 Some time ago I stated that the Stock Market and the Real Estate Market are related.  They move together on a longer term basis.  Looking back at that comment had me wondering why we are seeing a strong report on housing price increases nationally and how that relates to our Silicon Valley Market. To summarise the inconsistencies I can say that we are in a perfect storm situation.  It is not a buyer's market nor a seller's market.  The perfect market where sale prices are stagnant and buyers do not fight with other buyers in over bidding the home of their choice.  Pushing prices too high puts transactions at risk as lenders and appraisers are under pressure from a risk standpoint and homes do not pass.  The seller is now faced with putting the home back on the market and having to deal with a property that must cut prices to sell. In our present situation we are in a situation where there have been a record number of price cuts on a weekly basis.  Generally speaking for the Si

The San Jose Mercury News recently wrote that the Bay Area home prices continue to rise, in the face of a pandemic. WOW!  That was hard for me to fathom.  All I experienced are price cuts and selective demand.  The Ultra Luxury Market is soft. Sales occur below list and many tie the sale to a recent cut.  This Monday there were 56 price cuts in Woodside, Atherton, Palo Alto, Redwood City, Menlo Park and Portola Valley.  Palo Alto was the greatest hit with price cuts from 7-11%.  Two cities saw price to list increases.  they were Menlo Park and Los Altos.  The other took hits. The article goes on to say that the "median" sales price for an existing home rose 3.4% from last years "median" of $925000!  WAIT A SECOND!  $925,000?  Okay, where in our Silicon Valley is there a home for sale for $925,000?  When they went into various counties the number became a bit more realistic.  San Mateo median is $1.65 million.  I live in Farm Hill Estates.  The only $1.65 million sol

This past Monday I opened the MLS website for agents and hit what I call is my "Hot List".  The "Hot List" is a summary of all the new listing, pendings, solds, price cuts or raises, withdrawn and expired properties for that day. or week.  24 price cuts for my universe of real estate.  11 price cuts in Redwood City, for an average 5.62% price cut for an average list price of $1,830,000.  A 6.78% price cut in Palo Alto in 5 listings at an average list price of  $3,756,000.  Menlo Park has 3 cuts to average 5.63% on an average list of $2,498,000.  Atherton has 3 cuts to average 7% on an average list of $7,848,000 and 2 transaction fell through. Summer clean up of inventory?  With inventories low it would seem that prices would remain stable.  Too many cuts to warrant a low inventory market.  The week has been loaded with news articles on renters, both residential and commercial.  The jury is out on this one.  Stories abound on landlords that will not relent on ren