It's early October - many years, we experience an influx of inventory in Los Gatos homes for sale at about this time (between Labor Day and Halloween). Not this year, though.  It seems that the uptick in available homes for sale mostly happens in years where it's a seller's market.  The Los Gatos & Monte Sereno real estate market, especially in the 95030 zip code, where prices continue to fall, has not been a seller's market in most price ranges recently.  It appears that many homeowners are holding onto their homes for now - probably until the market recovers. My buyers are noticing the lack of inventory too.

(On a side note: I do have buyers looking for a turnkey Los Gatos home with 4 bedrooms, 2 baths and a less than 10,000 sf lot for up to 1.5 million. Nothing currently on the market is a fit for them - if you have a home that might work, or know of one not currently on the market, please let me know. Either zip code or school area is OK.)

Today we'll have a look at the list prices and inventory for two zip codes, which combined generally make up the area included in the Town of Los Gatos and also the City of Monte Sereno: 95030 and 95032. 95030 is Los Gatos and also Monte Sereno. (There are some funky exceptions: one area with the 95032 zip code out by Pollard and Quito actually belongs to Campbell but has a Los Gatos address for postal reasons. Another area near National and Carlton along the Cambrian border has a San Jose, 95124 mailing address but is actually Los Gatos - same thing, for postal reasons the mailing address is off.)

Another caveat - and a big one - is that today's study does not include a breakdown by school district. This can be a leading indicator of how your particular neighborhood might be faring.  Altos does not use this criteria so I can't factor it in with this study.  On August 24th, I did a post on my Valley of Hearts Delight blog on the Los Gatos Real Estate Market that did include the school district information.  This is great data but takes many hours to assemble, so it's not something I can provide often. But have a look there too - many of the trends are unchanged, even if the exact numbers are different:

The charts below were created by me with Altos Research, to which I have a subscription and the right to publish the charts. Altos uses LIST PRICES in its data fyi.

List prices with both zip codes combined, market separated out by quartile over the last 6 months:

Just 95030 - closer to downtown, usually, than most of 95032, and almost 100% "in the schools", this is a more expensive place to live than 95032:

Now just 95032:

Now inventory - the upper cluster of quartiles is 95032, the lower one is 95030:

Combining quartiles is a little easier (a quartile is 25% of the market so of course the four tiers will always be about the name in number as each other).

What's interesting is that although the 95030 zip code is usually more in demand (due to downtown Los Gatos proximity and the famed schools), those more expensive homes have not been getting scooped up by the market quite as fast as the homes in 95032. The latter are more affordable - and affordability is key in most price points. The days on market for Los Gatos homes for sale by zip code and quartile:

Altos provides a "median market action index" (greater than 30 is a sellers market)  that is quite interesting - note the huge difference:
 

Next, by zip code and price quartile.  95030 is "all over the board, with some parts trending downward and others moving upward...

Now for Los Gatos 95032, which seems to be behaving more as a unified group than 95030:

In most of the 95032 price points, the market's been improving. It's still a buyer's market, but until August or September, it was improving steadily.

How's the market? Really needs to be, "how's your specific market?"  The lowest price points in 95030 are selling well - which has been the case for months. The most expensive homes in 95030 are lagging the most - which has also been the trend.  The less expensive homes in 95032 are faring better overall. If we were to break 95032 down by school district (as I did in the post referenced above), we'd find that the homes selling the best are the ones with Los Gatos Schools (not Moreland or Union). 

For information on your particular corner of the Los Gatos real estate market or the Monte Sereno real estate market, please contact me. I'd be happy to chat with you - no obligation.

Are you on Facebook?  If so, let's connect! 

Recently I started a business page on Facebook for Los Gatos Real Estate & Homes. Inside there are a few easy-to-navigate tabs with realty market data, a quick way to search for listed homes, photos of Los Gatos and links to information about buying & selling homes as well as living in Los Gatos.

My personal profile is there too:  www.facebook.com/popehandy. Hope to see you there!  (And yes, I'm also on Twitter - find me at www.Twitter.com/MaryPopeHandy.)

How's the Los Gatos housing market now and over the last two years?  The "supply and demand" graph gives a good visual clue as to the challenge of selling in this corner of SiliconValley. Relative to what's on the market, only a few Los Gatos homes are selling. (Charts and data per Clarus Matrix, a perk of our MLS and real estate board.)

Pricing (or "home value") is perhaps the most important thing to home owners. "What's my home worth?" is the question. Prices are improving in some segments of the market - homes "in the schools" and under about 1 million are in very high demand and that may be pushing prices upward.

The "months of inventory" or absorption rate indicates how long it would take Los Gatos homes for sale to be absorbed by buyers if homes continued to sell at the current rate per month and no new inventory came on the market. (Less than 6 months is a sellers market, more than 6 a buyers market.)

 The chart below would have us thinking that the sellers are very happy and that homes are fying off the market - the first chart, though, tells the broader picture of supply & demand. What IS happening, then? Some Los Gatos homes in some prices are selling really well, but many others languish.

Inventory is now declining. This is more acute in some price points and school districts than others, but overall, the available supply of Los Gatos real estate for sale is now noticeably less than at the peak.

The average days on market for Los Gatos homes for sale has jumped around quite a bit. We do seem to be past the peak - but with so much "up & down", it's hard to be sure. Let's hope that the worst is behind us.

A look at all the charts collectively would seem to indicate that although the market is tough on sellers and great for buyers overall, as a whole the town may have already hit its bottom.  We won't know unless things are stable and continue improving for another year or so.  And, of course, this is "general information" for our town. Your particular neighborhood could be behaving very differently since micro markets are very important here.  Please call or email me for information on your particular market.

The Museums of Los Gatos are again sponsoring the always fun & interesting Historic Homes Tours on Saturday and Sunday, November 1 and 2, 2008, from 10am - 4pm.  For more information on the tour of these Victorian-era beauties, please contact the Museums of Los Gatos at 408 395-7386 or visit them online at www.MuseumsOfLosGatos.org.

                 Open House Saturday August 9, 2pm to 4pm
               
          Great Home, Great Location, Los Gatos Schools!

Last month I listed a great home that's in an ideal Los Gatos location - close to award-winning, highly acclaimed Los Gatos Schools: Van Meter Elementary School, Blossom Hill School, and Fisher Middle School. It's also a quick jaunt to the wonderful shops, banks, grocery stores and restaurants at the intersection of Blossom Hill Road and Los Gatos Boulevard.

Recently, the house at 120 Magneson Terrace in Los Gatos got a new roof and a big price reduction. It is a tremendous value!

Details:

120 Magneson Terrace (off Magneson Loop and Los Gatos Blvd or Shannon Road)
MLS # 814262
3 Bedrooms, 2.5 Bathrooms
Living Room, Dining Room, Bonus Room (office, library, music room)
Hardwood Floors
Air Conditioning
Brand New Roof
Quiet cul-de-sac location
appx 1800 SF home
lot size appx 8700 SF

Yesterday the sellers lowered the price dramatically AGAIN, and it's now a fantastic buy at $1,250,000! Hurry!



Folks who should consider this home include those wanting:

"Walk to Schools" or "Bike To Schools" or "Two minute drive to schools"

As well as those who want to be close to buslines, close enough to shops, banks, grocery stores, and restaurants that they could get there without a car.

For more details, please visit www.PopeHandy.com and click on Mary's Featured Properties.
Click this link to see a Virtual Tour of 120 Magneson Terrace, Los Gatos, CA


Best regards,
Mary Pope-Handy

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!