HOME PRICESUp 8.8%since Q2 2016
From Pacific Union International Chief Economist Selma Hepp – July 14, 2017
While Silicon Valley’s second-quarter home sales were on par with the same period last year, homebuyers this year showed renewed enthusiasm and a willingness to engage in bidding wars. More homes sold over the asking price, particularly higher-end properties. Seven in 10 homes priced between $2 million and $3 million sold for more than original price.
Heightened buyer demand coupled with continued supply challenges led to most of the region’s inventory being absorbed, and supply levels dropped to a two-year low. Affordable homes left the market at one of the fastest rates in the Bay Area. That combination again pushed home prices higher, reversing the slowing price trend seen in the second half of last year.
Looking Forward: While the return of enthusiastic buyers bodes well for Silicon Valley’s housing market, inventory shortages will remain a concern. The summer months should bring a seasonal lull in activity, but we expect September is expected to kick off another strong fall homebuying season.
Defining Silicon Valley: Our real estate markets in the Silicon Valley region include the cities and towns of Atherton, Los Altos (excluding county area), Los Altos Hills, Menlo Park (excluding east of U.S. 101), Palo Alto, Portola Valley, and Woodside. Sales data in the charts includes all single-family homes in these communities.