Prices Creeping Up

Over the past few months, as many have noted, buyer demand and even prices seemed to have crept up in areas like PA, Menlo, Atherton, SOMA, Los Altos etc., with spillover effects in places like Redwood City, San Mateo, etc. In talking to potential buyers and various agents, it appears that much of the increased demand (and, one would think, higher prices) resulted from the belief that one should buy now because prices were “certain” to increase after the Facebook IPO. This also affected the psychology of sellers, who were not apt to lower prices in light the bonanza that awaited. Also, I believe, one of the reasons that prices were so strong was that inventory was low – – and that this low inventory was a direct result of many sellers waiting to list their property until after the Facebook IPO. This created a situation of high demand (better buy now before Facebook IPO hits) and low supply (wait to list until after Facebook IPO) that helped keep prices strong.

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