Entering the Spring Selling Season
March 2019 Report
Spring 2018 was one of the hottest markets in San Mateo County and around the Bay Area over the last 2 decades. The market began to cool in summer and autumn - demand, sales and appreciation rates generally dropping, while supply and price reductions increased. Then the mid-winter doldrums took hold. The magnitude of these changes varied by region, and San Mateo was less affected than many other local counties - but it was still affected.
Since the recovery began in 2012, spring has typically been the most active season of the year, and often the period during which appreciation gains have been the largest. The spring 2019 market is just getting started amid a diverse set of economic indicators. Financial markets have, so far, recovered in 2019, interest rates have dropped, and big local IPOs loom. We will know much more soon.
Long-Term, Annual Trends in Median Home
Short-Term, Monthly Median Price Changes
The February median house sales price was well down on a year-over-year basis, but February is one of the lowest sales-volume months of the year. Looking at first and second quarter price data will be a much more meaningful indicator of home price trends, as we compare spring 2019 to spring 2018 (which saw a dramatic spike in median home prices).
Median House Price Appreciation
by City, 1998 - 2018
Markets appreciate due to a wide variety of local and macro-economic reasons: economic cycles, industry booms, inflation, consumer confidence, interest rates, employment, gentrification, new construction, comparative affordability (to other nearby markets), population growth, buyers’ median age, proximity to major company HQs, commuting, fashion, and so forth. The combination of factors affecting any particular area is often specific to that market.
Around the Bay Area, more expensive homes have generally appreciated less than more affordable homes, especially over the last 3-4 years, but the picture in Silicon Valley is more complicated. For example, in San Mateo, Atherton has the second highest 20-year appreciation rate, and it is the most expensive city in the Bay Area. The city with the highest rate is East Palo Alto, the most affordable city in the county. (In Santa Clara County, Palo Alto came in first.) These percentages should be considered very approximate.
For more context on the appreciation percentages above, below is a chart from last month's report delineating 2018 median sales prices.
Inventory Levels in January-February
January-February inventory was well up from the abnormally low levels seen during the same months of recent years, but was not particularly high from a historical perspective.
Active Listings on Market
as of March 1, 2019
The number of active listings fluctuates daily, and the numbers below are rapidly increasing as more new listings come on market. These next 2 charts are snapshots of active listings on March 1st.
Listings on Market
by Price Segment, 3/1/19
Active Listings by City
& Median LIST Prices, 3/1/19
The supply of listings available to purchase varies widely between cities, which can be a simple reflection of market size and/or an indicator of supply and demand dynamics. If median LIST prices (below) are well above median SALES prices (charted earlier in this report), it is typically a sign that the balance in listings for sale is disproportionately weighted towards higher priced properties, which take longer to sell - and/or a sign of systemic overpricing beyond what buyers consider fair market value.
As of March 1st, Atherton had a median house list price of $11 million for its 18 active MLS listings - far and away the highest median asking price in the Bay Area.
New Listings Coming on Market
New inventory usually starts pouring into the market right now, in early spring, to fuel the biggest selling season of the year. It also spikes dramatically in September for the shorter autumn season.
Home Sales Volume
So far in 2019, monthly sales volumes are very comparable to the beginning of 2018, however these are typically the lowest sales-volume months of the year. March is usually the month in which the big spike in spring sales starts to show up, following the jump in new listings.
Listings Priced $3 Million+
Accepting Offers, by Month
If anything, the luxury home market in Silicon Valley is even more fiercely seasonal than the general market.
Market Statistics by City
Many of the cities ranked at the top of the market-heat scale - as measured by 2 standard statistics below (for the second half of 2018) - are among the most affordable. But there are certainly other factors, as mentioned in the paragraph on appreciation rates.
Sales Price to Original List Price %
Any percentages over 100% reflect overbidding of asking prices. Though these percentages have been declining since mid-2018, many of them are still very high compared to other markets.
Average Days on Market
Many of these days-on-market figures are among the lowest in the Bay Area. Note that it is not unusual for more expensive homes to take longer to sell, though, again, that is not always the case.
Comparing Bay Area County Markets
Listings for Sale by Price Segment
Median Home Prices, Q4 2018
San Mateo and San Francisco Counties have been alternating by quarter for the title of having the highest median house sales price in the Bay Area.
Active Listings Priced under $1 Million
Luxury Home Listings by County
Santa Clara County has the largest market in the state for homes priced $3 million and above, but San Mateo County has more listings priced at $10 million+.
County to County Migration
Coming to & Leaving San Mateo
People move to San Mateo County from all over the country and the world, and people leave to move to a vast number of locations, for differing reasons. This analysis looks at those counties with the greatest number of people moving to and from San Mateo. In many cases, there is a large exchange between 2 counties, with residents going in both directions. Often, but not always, the outward flow is greater to counties with more affordable home prices, but there are many factors - such as schools, employment, commuting and other quality of life issues - at play.
Silicon Valley vs. U.S.
Unsurprisingly, Silicon Valley is one of the most educated places on the planet.
Education & Income
Disparities between the Sexes
An indicator of the income-generating value of education, along with an unhappy indicator of where progress remains to be made in income equality. (As an aside, real estate is certainly one of the first professions that saw income equality established between the sexes: Women have been holding their own and, indeed, often dominating rankings of top Bay Area agents for many decades.)
The statistics in this report are very general and approximate indicators based upon listing and sales data pertaining to assortments, of varying size, of relatively unique homes across a broad spectrum of locations and qualities. How these statistics apply to the current value, appreciation trend, and prevailing market conditions of any particular property is unknown without a specific comparative market analysis.