San Mateo Real Estate Update November 2011 - Low Inventory

The inventory of homes for sale remains low in San Mateo. At the end of November 2011, there were 102 homes for sale, which is the lowest at any point since the beginning of 2007. It is a sign that the area is starting to work off the inventory hangover that built up due to the sharp drop in sales activity that started at the end of 2007.

Even with fewer options for buyers, sales have kept pace with last year. On a year-to-date basis, there have been 546 homes sold in the city of San Mateo, as compared to 540 at the same point last year. The most recent month for which we have complete data, November, there were 39 homes sold. While this is below last November when there were 53 homes sold, it is a typical total for the month.

The type of constrained inventory that we mentioned above often signals increasing price competition as buyers compete for a dwindling supply. However, price levels in San Mateo appear to be softer than other nearby Peninsula markets that we follow.

Prices per square foot in San Mateo have averaged $472 in the first ten months of 2011, as compared to just under $500 in the same period in 2010, a decline of about $30, or 5%. While a decline of $30 in price per square feet might not seem like a lot, it translates into a swing of $60,000 for a 2,000 square foot house. Sellers that are in a rush to sell may need to be more aggressive dropping their asking prices, if they are not getting offers.

One point of caution is that because San Mateo has such varied mico-markets with prices ranging from $450,000 to over $2,000,000, any downward change could just be a shift to a higher proportion of homes being sold in less desirable parts of the city, rather than actual selling values falling. In fact, it is quite remarkable the range in selling values for a city as small as San Mateo.  In 2011, there has been a home sold for over $3 million and for under $250,000.

A continued counterpoint to the notion of softening is that we do not see evidence of sellers dropping prices on a widespread basis. The sale price divided by list price has averaged 99% in 2011, meaning that homes sold for about 99% of their asking price. It has also been above 99% in the last two months. This is both a strong number and on par for the normal rate in San Mateo for the past few years.

If you're interested in learning more about the San Mateo real estate market, considering selling your home in San Mateo, or thinking about moving to San Mateo, please drop me a line and I'd love to connect with you.

By The Numbers - San Mateo Real Estate for November 2011