UNDERSTANDING THE CURRENT SANTA CLARA COUNTY MARKET – IS IT A SELLERS MARKET?

As a homeowner, and a prospective seller, you may be wondering if now is a good time to put your home on the market. But how can you tell if the market is in your favor at this time? Will you lose money or make money? Is it a “sellers market”?These are all very important questions. And the answer is in the market statistics.

As a seller, one of the first things you must evaluate is the desirability of your location. Market conditions are extremely localized statistics. While the national economy and housing market tie every area of the country together to a certain degree, markets and their conditions range widely from state to state, community to community, and even neighborhood to neighborhood within a community.

You must ask yourself, and your real estate agent, “Is my neighborhood up and coming or has it already come and gone?” If you live in a neighborhood that is highly desired due to its school system such as Cupertino, or areas of status and Prestige such as Los Gatos and Saratoga, then you may find yourself in a continual sellers market, where you will always be in the advantage. 

Looking at the most recent sales in your surrounding area is very important. How much are homes selling for? And how does your home compare in size, location, upgrades, and condition?  Unfortunately, an issue completely out of your control can have a direct effect on your ability to sell your home, and for a good profit. Foreclosures in your neighborhood affect your home’s value. This isn’t fair, but it is how the market works. Buyers look for the best home for their dollar. If they are able to buy a home on your street for a foreclosure price, then suddenly your asking price must decrease in order to compete. Be sure to ask your agent for tips on how to make your home stand out again to buyers, despite this issue.  Another important statistic you should be aware of is “days on market.”  This means how long it takes a home to sell from the time it hits the market. In general terms, anything less than 6 months is considered a sellers market. If the average time is longer than 6 months, then the market is in favor of buyers.  This should be a consideration for when you look to buy your next home. Unless you are prepared to carry two mortgages, you will want to make sure your current home has sold before looking for the next. 

How is the local job market faring in your city? If you live in a town that has a healthy economy, then chances are you live in a sellers market. People who have steady jobs are more inclined to look to buy. The bigger the unemployment figures, then fewer buyers on the market. 

Another consideration is “appreciation.” In a healthy market, a home should increase in value each year. Many of the areas of the country, however, experienced a “bubble burst” after seeing years of record appreciation rates. As we all know, California and more specifically Santa Clara County was amongst these areas.  Homes bought during the bubble may very well be worth less now than their owner owes. However, it is important to understand the long term effects the market will provide. Although Santa Clara County has experienced dips in appreciation about every 10 years, the long term data shows that this market continues to consistently appreciate. 

Be sure to discuss all of these issues with your local real estate agent. They will be able to help you determine whether now is a prudent time or not to put your home on the market. 

To give you an idea of how the Santa Clara County market is currently doing we have included the most recent statistics on home appreciation and average sales price for this area.