October Market Trends
Are Home Prices Falling?
Recently local real estate agents have been reporting that local home values are falling, and if you are planning to sell your home in the near future you better do so now. Their conclusions are based on a drop in the median price for homes that sold during the third quarter of this year. The conclusion that home values are falling is inaccurate, as the median price reflects what is selling (higher-priced homes versus low-priced homes) more than whether home values are going up or down. In determining the current direction of home values, I look at:
- Inventory levels– remain historically low in most cities at about one month of sales
- Percent of asking price received– buyers continue to pay over the asking price in a high percentage of sales
- Price appreciation calculated when the same home sells and resells within a short period of time (1-2 years)
Area home values are currently rising slowly, as local markets normally perform during the second half of any given year. Approximately 75% of appreciation happens during the first half of each year.
In the charts below, you’ll find 15 years of data for market activity and median sales price for the month of October for Los Altos, Palo Alto, Los Altos Hills, Menlo Park and Mountain View. You can’t find this level of historical data all in one place anywhere else, so if you have any questions or wish to get more info about your community, don’t hesitate to contact me.