U.S. Home Sales Drop in December, Bay Area Inventory Down Too
The National Association of Realtors (NAR) reported sales of existing-homes fell 1% in both November and December from 5 million and 4.94 million, respectively. The seasonally adjusted 1% drop countered economists expected projection of a 5.1 million improvement from a reported 5.04 million in November. The median price of an existing single family home rose to $180,800 in December, which is up 0.8% from November and up 11.5% from December 2011. This is the strongest year-over-year gain in seven years. These numbers are a stark contrast to Silicon Valley’s bustling real estate market. The median price for a home in Santa Clara County in December was $682,500, down 0.4% from $685,000 in November. The year-over-year gain is 28.8% at $530,000. What a difference!
According to the NAR, the supply of existing homes for sale fell in December to 1.82 million, which is the lowest level since January 2001. The current month’s supply is down 21.6 percent from a year ago. The reason for this is driven by a low inventory. One reason homeowners are reluctant to sell could be weak prices, which have only recently began to increase. Locally, the home inventory in Santa Clara County is also struggling—off 77.2% from last December. Ouch!
Bay Area Real Estate Market Promising vs. National Average
The national average of foreclosures and short sales accounted for 24% of December sales, up from 22% in November. Foreclosures sold for an average discount of 17 percent below market value in December. Short sales were discounted at 16 percent. Santa Clara County’s foreclosures and short sales accounted for only 19.9 percent of December sales. While short sales in Santa Clara County were up 11.6% from November, the number of foreclosures saw a significant improvement with a 26.5 percent decrease.
Nationally, the median time on market for all homes was 73 days in December, up from 70 days in November. Featured listings in Silicon Valley were only on the market an average of 36 days, up from 32 days in November. These stats show the intensity of demand for Bay Area homes for sale. Sellers are reluctant to sell and buyers are ready to snatch up prime Silicon Valley real estate as it comes.