The number of single family homes sold in Los Altos is at an 11 year low. Since 1998, the average number of number of homes sold (closed escrow) in November is 26. In November 2008, only 8 Los Altos homes closed escrow. Note: most of these purchase contracts were ratified in mid/late September.
That is a 69% drop over an 11 year average (of 26) and a whopping 78% drop from the just 2 years ago (2007 had 36 closed sales in November). 2007 was the next lowest year in sales volume with 21 closed sales. See graph below for November sales history since 1998.
The volatility in the stock market has had a huge (negative) impact on our market by reducing the amount of funds available for the down payment and financing (especially jumbo loans) continues to be difficult at best.
Over the past several weeks, I have had the opportunity to speak with many buyers who have come through my open houses. The one constant – buyers tell me they are “hunkering down.” They are in a “wait and see” mode and aren’t likely to make a home purchase until they believe the real estate market is getting stronger. In short, buyers feel our local real estate market will continue to soften.
What’s interesting is a well qualified buyer can negotiate a pretty fantastic deal, even in Los Altos. We’re talking home purchases at 2004 prices (or better). The problem is it’s tough to know “a good deal” if one doesn’t know where the market is going or when it will change. Time will tell.
I thought I would end this post with a little prediction – Investors will take the lead in December home sales. I predict 5 closed single family home sales in Los Altos for the month of December 2008.