In this month’s review, we focus on the markets and property types that are bucking the trend, why they are seeing growth, the niches that are providing opportunity, and what factors have created this demand.
During this review, you will see the importance of using data to recognize trends and why understanding the current market, both nationally and locally, could make a significant difference in being able to leverage a successful sale.
Never has this statement been more relevant than to homeowners looking to sell in the current real estate market as it transitions away from its previous fast pace – when we saw high demand, low inventory, and rapid price increases. Today, the market is more stable, inventory is on the rise, demand is lower, and price points are fairly consistent; giving buyers a stronger position in terms of choice and negotiation.
In comparing January 2018 to December 2018, the ratio of sold homes vs. inventory has dropped a significant 3.5-4.5% for luxury single-family and attached homes. The luxury single-family market saw an increase of 5,901 new homes entering the market over last month and attached homes saw an equally staggering increase of 2,237 homes over December 2018.
These overall decreases in sales and converse increase in inventory can be attributed to a seasonal shift, fewer listed homes toward the end of fall have resulted in fewer sales in winter and the increased inventory now helps buyers and sellers alike gear up for the traditionally fast-paced spring market.
Shifting back towards focusing on specific markets, Silicon Valley remains at the top of the charts in the luxury market reflecting the high demand on its current inventory – and this is in spite of its high median current list price tag of $4.1 million for single-family homes and $1.4 million for attached properties. Bloomberg noted that the town of Atherton is America’s richest community for the third year in a row, with an average household income of $450,696. When asked why it continues to be so popular the Mayor, Bill Widmer, said that it was a combination of privacy, large acreages, and accessibility to Silicon Valley and San Francisco that has maintained its desirability.