I'm excited to announce my mid year reviews of the Burlingame and Hillsborough real estate markets have been released. Below are summaries of the reports, which can be downloaded by clicking on the images.
In the past 12 months, prices have risen by about 15%. They are now at least 15% above where they were at the previous market peak in late 2007/early 2008. Buyers continued to regularly bid above list prices, even as sellers update their asking prices to match recent comps. The average home sold in Burlingame in 2014 has sold 6.6% above the final list price. Multiple offers are the norm, not the exception, as buyers compete in a market where supply (measured in terms of inventory of unsold homes) remains at the lowest level in over ten years.
» 20 homes sold above $1,000 per square foot (versus 11 in all of 2013, and just one in 2012).
» The average price per square foot of $865 is exactly $100 above full-year 2013.
» June 2014 saw the highest ever average price (just above $1.9 million), the highest ever median price ($1.85 million) and the 2nd highest ever average price per square foot ($901).
» The sub $1 million single family home is almost extinct. There were less than 5 such sales.
The imbalance between strong demand (buyers) and low supply (sellers) is likely to be in the favor of sellers at least through the end of the year. A jump in mortgage rates or a sudden weakening of the economy are always potential pitfalls. Longer term, I offer the following thoughts. The current rate of price appreciation, which would mean a doubling of home values every 5 years, seems unsustainable. However, the current level of pricing seems sustainable, as the majority of today’s buyers are making strong down payments of more than 20% and the local economic climate remains robust.
In the past 12 months, prices have risen by about 10%. They are now at least 10% above where they were at the previous market peak in late 2007/early 2008.
Inventory levels have fallen to their lowest levels in years. This means that more buyers are increasingly competing for the same home. While the Hillsborough market is not typically known for regular bidding wars, we have seen the average home sold in 2014 go for 100.7% of the final list price. The ratio of sales price to list price has never been above 100% for a full year in the past 10 years.
» More homes have sold above $1,000 per square foot in the first six months (18 homes) than in all of 2013 (17 homes).
» The sub $2 million single family home is almost extinct. There were less than 5 such sales.