Burlingame Real Estate - May 2012

Bidding Wars

In Burlingame, we are seeing more and more homes sold with multiple offers and offers above asking prices.  This is especially prevalent in the lower end of the market, where well-priced homes in desirable locations are sometimes getting 5 to 10 offers. The chart below shows the average monthly sales price to list price ratio.  When the ratio is above 100%, then it implies the average sale is above the final asking price. There has been an uncharacteristic spike above 100% in the last few months. The ratio in May 2012 was 104.7%, the highest in any month since the end of 2005.

This data suggests we are in a seller's market and that prices are/will be rising.

Sales Activity Strong Through May

Sales activity continued to be healthy in Burlingame in May 2012, with 22 homes sold. Through the first five months of the year, there have been 84 homes sold, up from 71 homes sold in the same period in 2011. Looking forward, June 2012 could be a blockbuster month. There were a number of homes with accepted offers in May that will not close escrow (and be counted as sold) until June.

The inventory of unsold homes remains low. At the end of May 2012, there were just 38 homes for sale. Last year at this time there were 57 homes. Without a continued flow of new listings, sales activity will be limited in the next few months. However, if May 2012 is any indication, the word has gotten out to prospective sellers about market conditions. There were 45 homes listed, the most in any month since May 2008. Sellers that have been sitting on the fence are likely seeing this as a good opportunity to sell their homes for potentially the highest price they would have likely received in the past 2 to 4 years.

Even with the new listings, the market is still inventory constrained. It can remain constrained even if inventory rises through the summer. The summer months are the most active for real estate transactions. Listings, sales and inventory are typically the highest during this time period, as many buyers and sellers are looking to move without disrupting their children's school schedules.

Signs of Upward Price Pressure

The traditional measures of selling values, median prices and average prices, appear to have hit a bottom in early 2011, with signs of price increases since then. This is most readily apparent when looking at the average price per square foot. The 12 months moving average was $617 in May 2012, up from $591 in July 2011. The average has not been this high since the end of 2009. Of course, at that time, the momentum was clearly downward, while now it is clearly upwards. In eight of the last ten months, the average price per square foot has been above $610.  In the ten months prior to that, it was above $600 only once.

Recent Home Sales in Burlingame

This is a selection of sales from May 2012, sorted by area of Burlingame.

By The Numbers - Burlingame Real Estate for May 2012