San Mateo Real Estate - June 2012

Raziel Ungar

July 22nd, 2012 - 2 min read
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Second Month of Selling Values Above List Prices

The average ratio of selling price to list price in the San Mateo real estate market continues to be over 100%. It was 103% in June 2012, the fifth straight month above 100%. For the year, the ratio is the highest since 2005, in the middle of the last boom in real estate prices.

This is a hugely positive sign for sellers and a strong indication that many properties are receiving offers from multiple buyers. It is a sign that prices are poised to rise. We are seeing similar experiences in other Peninsula communities like Burlingame and San Carlos.

Inventory Remains at Historically Low Levels

While inventory levels appear to have hit bottom in the past few months, they remain at the lowest mid-year levels in many, many years. There were about 75 homes for sale in San Mateo at the end of June 2012. At the end of June 2011 there were 186 homes for sale. To put that into perspective, a buyer that was choosing between 15 homes on which to make an offer last year, now only has 6 homes to choose from this year! This is a big driver of multiple offers on the same property. There are not enough listings to go around for all of the buyers out there....

Sales Activity Continues to be Strong

Continuing the theme of a red hot market, sales activity has been robust in the past two months, with over 75 homes sold each month. In fact, both May and June 2012 have had the highest sales totals of any month since August 2006.  Through the first six months of 2012, there have been 353 homes sold, as compared to 275 homes sold in the first six months of 2011. At the current rate, we could see 700 homes sold in San Mateo for the first time since 2006. There hasn't even been more than 600 homes sold in a year since 2006. Higher sales have been a contributing factor to lower inventory. Another factor is that there have been fewer new listings. In 2011, new listings were down seven percent from 2010. So far in 2012, they are down another five percent.

 

Prices Firm, Likely to Rise

With the exception of a slight upturn in the average price per square foot the classic measure of price levels, average price, median price and average price per square foot, show no solid signs of increase, yet. But with buyers bidding above asking prices that is likely to change. How can we be so confident? Well, most sellers set their asking prices based on past comps, maybe a little higher or a little lower depending on how motivated they are to sell or what their read of the market is. If selling values are above list prices then this suggests that selling values are above past comps, hence prices are rising.

In a small real estate market like San Mateo, on a month-to-month basis prices fluctuate more based on what happens to sell that month (bigger or smaller homes, etc...) than on changes in the underlying price level. This issue is exacerbated in San Mateo because of the wide range of neighborhoods in the city. Some neighborhoods have homes that sell for less than $500,000, while others are mostly $1 million+ listings.

We will continue to monitor selling values and see if price trends end up confirming our hypothesis about rising price levels.

By The Numbers - San Mateo Real Estate for 2012

Current Month YTD Total or Average
June 2011 June 2012 Jan - Jun 2011 Jan - Jun 2012
Sales 65 76 275 353
Days on Market 36 26 49 39
Months of Supply 2.9 1.0 3.4 1.4
Average Price $859,000 $872,000 $824,222 $842,856
Median Price $685,000 $810,000 $733,902 $737,031

Thinking of buying or selling a home in San Mateo?

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.

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