I just read an interesting article by Arn Cenedella, another Coldwell Banker agent located in our Menlo Park office, about inventory patterns in Menlo Park. I thought I would check if there was a similar inventory pattern in Los Altos.
If one takes a look at the graph below, Los Altos Real estate certainly has a seasonal pattern.
Inventory in January is very low. The homes that are available for sale tend to be the “leftovers” that didn’t sell during the previous fall. They are either over priced, poorly located, marketed improperly and/or a combination of all three. Inventory will gradually increase over the next several months with spikes in April/May and again in the fall months of September/October. From November through the end of the year, inventory goes dormant and then the annual real estate cycle repeats itself. Note: each year is unique as well as each neighborhood in Los Altos is unique. Please keep in mind that the statistics quoted here include homes located throughout all of Los Altos and in all price ranges. Your mileage may vary! Over the last 3 years, inventory in January averaged 33 homes, in April – 75 homes, in August – 60 homes, in December – 23 homes.
Comparing the last 9 years of Los Altos single family home sales, 2007 was an real estate inventory anomaly. Since 1998, inventory for single family homes has averaged 545 homes for sale a year. Approximately 70% of these homes sold in any given year. The highest inventory year was 2005 with 589 homes and the lowest was 2000 with 481 homes. The most productive year for sales was 1999 where 88% (463 homes) of the 524 homes sold. In 2007, approximately 410 homes were for sale (approximately because the stats for December 2007 are not yet available). Approximately 78% (320) of these homes sold. Therefore 2007 inventory dropped 25%, but the percentage of sold homes rose by 8%. What can we expect in 2008?
Hopefully more inventory. The general consensus is that we should have more inventory than 2007. Exactly how much more is anyone’s guess. Stay tuned!