According to MLS Listings Inc. data, 24 single family homes closed escrow in August within the city of Los Altos zip codes of 94024 and 94022. This is slightly below the 12 year average (for the month of August) of 36 closed sales of single family homes. The graph below documents the last 12 years of listings and sales figures for the month of July.
Homes listed at the lower end of our market (if one could call homes listed between 900K and 1.5 million, the “lower end”) continue to sell well. In August, there were 6 homes sold that were listed at 1.5 million and below. There was a slight shift relative to July in that the price range between 1.5 and 2.0 million had more sales than that of below 1.5 million. 11 homes in this price range sold, 5 homes listed between 2.0 and 3.0 million and 2 homes listed above 3.0 million sold. Note: these were the asking prices for the homes not the selling prices.
The homes that were listed under 1.5 million sold at an average of 97.6% of list price. The homes listed between 1.5 and 2.0 million sold at an average of 100% of list price. The homes listed between 2.0 million and 3.0 million sold at an average of 93.6% of list price. Lastly, the homes priced above 3.0 million sold at an average of 86.7% of list price (ouch!).
Note: the actual list price to sales price ratios are probably a little less because I have have included only the latest/current list price in the calculations. Some of the higher priced homes have been listed and re-listed at a lower price. Had I used their original list price, the ratios would be lower.
The chart below shows a 12 year history of the average sales price versus the median sale price of single family homes that closed escrow in the month of August.
The list price to sales price ratio for the month of August (95.81%) is approximately 4% below it’s 12 year average. See below.
Total sales volume for the month of August is the lowest it has been in the last 8 years.
Lastly, in addition to softer home prices and less sales volume, on average homes in Los Altos are taking longer to sell. In August 2009, it took on average 53 days to sell a home in Los Altos. That is approximately 1/3 longer than the 12 year average in August of 40 days. See details below.
All in all, the MLS sales figures for August indicate that the Los Altos real estate market (at least those homes that closed escrow in August) was the worst in recent memory. Since we’re not dealing with a large sample size, one can’t assume the overall market is in the toilet. Buyers, for the most part, can negotiate a favorable deal.
Sellers should look seriously at whether now is the right time to sell. Should home sellers decide it is the time, proper pricing, home preparation and a sound marketing strategy mixed with realistic expectations will make for a better experience.