What Is A Patio Home?

Most homebuyers and sellers in Los Gatos and Silicon Valley generally are familiar with the terms "condo" or "condominium", "townhouse" or "townhome" and "single family home". But what about "patio home"?  What type of residence is that?  It's an unknown to many consumers - and many real estate professionals too!

A patio home is sometimes referred to as a zero lot line home. It is a house (not attached to any other home) in which the structure is built against one of the property lines.

In a regular single family home, the building has a few feet on each side between the structure and the property line. In other words, you can walk around all four sides of the home without going on anyone else's property.

That isn't the case with a patio home.

A patio home is build up against the property line such that the owner cannot walk all the way around the house without going on someone else's property.

There are advantages and disadvantages of patio homes. Advantages include more privacy than a townhome or condo would offer, and better use of land adjacent to the home since there aren't small 5-8 foot side yards, but instead something more sizeable and useable.

Disadvantages include the lack of windows on the side of the home which is built on the property line and the inability to protect the side of the home that functions as a fence or boundary for the neighbors.

By way of example, if the side of your patio home that lines the boundary gets excessive moisture because the neighbors vigorously water their plants and don't worry about hitting your house, that's a problem. Additionally, since you cannot see what's happening without asking the neighbors if you can go on their land to keep an eye on your exterior wall, there's a risk that the structure could be getting damaged and you'd never know it. So there's a loss of control and a loss of information that's intrinsic to this type of home.

Additionally, many patio home communities have an association fee and that also needs to be factored in.

Should you buy a patio home? It's on a continuum between townhomes and single family homes. It may be the best compromise for you, or it could be a big headache. My thinking, generally, is that if you can buy a single family home for the same amount, your money is better spent there. But if you're in the market for a townhome, this is definitely a step up and worth a little stretch.

How Does the Los Gatos Real Estate Market Compare This Year to Last Year?

The Los Gatos real estate market is composed of many micro-markets in housing type, location, price point and condition. A Los Gatos condo in one school district may be in an entirely different type of market than an estate home with a view of the Santa Clara Valley or a golf course, of course.

Overall, though, the market here in Los Gatos is healthier than in many other areas within Silicon Valley. One one of measuring the health of the housing market is to follow the absorption rate. The absorption rate reflects the amount of time it would take for the current inventory of homes for sale to be bought up if no new homes came on the market and sales continued at their current pace. It can be days of inventory, weeks of inventory, or months of inventory tracked.

The National Association of Realtors uses 6 months of inventory as the tipping point between the market favoring buyers vs sellers. Under 6 months' inventory is said to be a sellers' market, and over 6 months is said to be a buyers' market. In the San Jose area, though, we are behind on housing starts and are used to homes selling fairly quickly, so most sellers will not feel as though 4, 5, or nearly 6 months' of inventory is really a market in their favor. They expect to sell in a few weeks, not a few months.

Here's a graph I did of the months of inventory in the Los Gatos real estate market for the first half of 2008 (in green) and also, for comparison's sake, the first half of 2007:

As you can see, the market was worse for buyers (better for sellers) in the same timeframe in 2007 as it is now. Since the months of inventory is a ratio of that month's closed sales to its active inventory, this data really reflects the month or so prior in terms of when purchase agreements were signed and accepted.  So looking at the numbers in April really shows you what was happening appx 30 days earlier (most of our escrows are about 30 days long).  In 2008, then, May and June were much better than the 4 months prior, and they reflect contracts written in April and May. June 2008 wasn't bad compared to earlier in the year, but clearly, the peak of the market was April because May's closings were the best.

Other data supports this too. I have a subscription to the Real Estate Report and the numbers there suggest that the highest median and average sales prices for single family homes peaked in April too (go to the page for Los Gatos and view the graphs).

Much of 2008 has been off in terms of the usual sales patterns but most years, the peak of the market is somewhere around March or April. At that point, prices frequently hit their high point of the year - great for sellers, not so great for buyers. By summer, the market cools down most years and sellers may be frustrated that they are not seeing the prices from a couple of months earlier in the year. For buyers, though, summer can be ideal since inventory is good and sales are a little lower.

No one can predict if the market will go one way or the other, but I would say that buyers are in a good position now if they want to get into a nice Los Gatos home.  The loan situation has calmed down and market conditions are favorable for most segments of the Los Gatos real estate market and there's a nice selection now. My advice to Los Gatos home buyers is simple: don't wait!

John N. Pope, Obituary

John N Pope, Jr (2-27-1930 to 6-29-2008)

John and Pat raised three children in Santa Clara and Saratoga. John was very supportive of Pat’s real estate career, which she began in 1956 (when very few women were selling real estate).

John’s passions were travel, history, politics, family and faith. When the family was young, John and Pat made many frequent trips to the east coast to see the Pope relatives. The travels later expanded to include Europe, Great Britain, central America, the Virgin Islands, and elsewhere.

There will be a funeral Mass at St. Lucy’s Catholic Church in Campbell on July 9^th at 11am, followed by burial at the Santa Clara Mission Cemetary and a reception afterwards. A memorial Mass was held in his hometown of Morristown, New Jersey, on July 2nd as his only sibling, Helen, and her family live nearby and many other relatives were assembled in Cape May, NJ, for a family reunion, when he died.

Donations in John’s honor can be made to ARH Recovery Homes, Inc.
1101 S. Winchester Blvd.,Suite J-220 San Jose, CA 95128  Phone: 408-236-6657 info@arhinc.org.  He had been very involved with this alcohol recovery home, at one time serving on its board, and would love to have its good work furthered on his behalf.

Congratulations to Jewish Family Services for Overwhelming Success with the First Annual Silicon Valley Duck Race!

See the Moonrise in Los Gatos Tonight!

Campbell Fire Near Los Gatos Border Fills Sky with Smoke

Image of the Martin Fire Smoke from Los Gatos Border

This is a photo of the hills over Los Gatos at about 5:45pm this evening. The smoke is from the "Martin Fire" (so named for Martin Road, close to the fire), which began a little before 3pm near Bonny Doon.

Currently, it's burned through about 300 acres and caused 1400 people to evacuate, but because of the hot, dry weather and winds, it could easy grow to 1000 or 2000 acres.

Firefighters do not yet know what caused this fire.