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At an office meeting this morning, a statistic was shared that 20% of all sales in Sana Clara County are "all cash" right now. This year I've had two all cash transactions, which is more than is typical for me, so I thought it would be interesting to check it out a little more.
My next stop was MLSListings.com, where I crunched a few numbers (deemed reliable, but not guaranteed yada yada yada). I ran these numbers via what has closed within the last month (30 days), not during just October or during all of September 2011.
It's 100% true that in Santa Clara County, 20% of all closed escrows in the last month were "all cash". In San Jose, the number was even higher: 24%. Teased out further, of the distressed sales in San Jose (short sales and bank owned properties), it's a full 34% (33% short sales and 37% REOs or bank owned homes). That's huge! My hunch was that this was largely lower priced homes so I broke it out by price point also and found that of homes under $300,000 (this is houses, condominiums, townhouses and duet homes) it was a whopping 46% of sales that were all cash in the last month.
On the other side of the coin are homes in Los Gatos and Monte Sereno, where by comparison far fewer all cash deals have happened this year. (I did close one a earlier this year at 176 Kensington Way, Los Gatos, in the high 600s, but it was a fixer upper.)
In just the last month, though, in both 95030 and 95032 (both of which serve Los Gatos and Monte Sereno) there were NO all cash real estate sales for classes 1 and 2 (houses, condos etc.). One sale of six in the mountains was done without financing.
In most of the west valley communities of Silicon Valley, it appears that home sales without loans are not a huge portion of the market, with one exception: Saratoga. Last month Saratoga had 29% of its closed sales happen all cash. I'm not sure why that's the case, which of the school districts this is, if they were all condos etc. I could spend infinite hours picking that apart but it is an interesting anomaly.
It should be added that while we are discussing all cash in escrow, some, perhaps many, of these new home owners may later obtain some sort of financing after the sale is completed.
As always, the statistics may not apply to your particular home, area, school district, housing type etc. If you are interested in selling or buying a Silicon Valley home, please contact me. We can further refine the numbers that actually pertain to you and your precise situation should we work together on the purchase or sale of property.
For further reading on the topic of all cash real estate sales in Silicon Valley:
Cash offers: what do you need to know if buying “all cash”?
Q & A: Making an Offer
What’s My Silicon Valley Home Worth? Estimating the Probable Buyer’s Value (financing impacts market value)
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