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 We just cannot seem to stop setting records. Once again, we see that inventory is at its highest point for the month of October going all the way back to 1998.
Sales are down. Even the number of homes added to the market in October is up - strange when you consider the market and the time of year.
Finally, the average home price is AGAIN up in Santa Clara County.
Read on for all the details.
Supply And Demand
The total inventory of homes continued its year to year increase. The inventory is up 32.6% when compared to October 2006.
That gives us a total of 4976 homes currently for sale in Santa Clara County.
The sales numbers continue their downward trend with a 37.5% decrease when compared to the same time last year.
That gives us a total of 575 homes sold in Santa Clara County in October 2007.
Even more interesting is that in the face of all these numbers, we saw in increase in the number of homes entering the market. When compared to the same time last year, new home listings were up 18%. That gives us 1740 homes added to the inventory in October.
Given our current numbers, we have enough inventory in Santa Clara County to last for 8.6 months.
From September 2007 to October 2007, we saw the inventory of homes increase by 1.7%. When we look at last years performance, we see that inventory actually dropped over the same period last year. This is typical as sellers normally avoid listing during the holiday season. This may be an indicator of sellers that MUST sell as opposed to sellers simply entering the market under normal circumstances.
Thee is some good news in that sales actually increased by 9.7% between September and October in Santa Clara County. Again, something go defies the usual trend. Buyers also usually stop shopping during the holiday season. So this increase in sales is encouraging.
New listings were also up from last month by .3%. Not a large increase, but interesting since we usually see a drop in this number at this time of year.
Home Prices
Despite it all, Santa Clara County manages to see the average single family home price increase yet again.
The average price of a home in Santa Clara County is now $1,053,483.
That is a 10.5% increase when compared to the same time last year. Not every part of the county is enjoying an increase in average price. There are many cities and communities within cities that are seeing lower average sales prices.
The highest price paid for a home in Santa Clara County in October 2007 was $8,250,000 in Palo Alto.
The lowest price paid was $231,922 in Gilroy. 
The more short term look back at the average sales numbers shows a little fluctuation, but nothing outside what you would expect for the seasons. The one exception is the slight bump in average price that was seen in August, when average prices usually tend to drop a bit.
From September to October, the average price of a home in Santa Clara County dropped by 1.4%. This is normally for the time of year, as we enter further into the winter and holiday season.
Days On Market
When compared to last year, there has really been very little change in how long it takes to get a home sold this month.
For October 2007, it took 55 days to get a home sold in Santa Clara County. That is actually a decrease of 3.5% from the same time last year.
Also, it does not yet reach the 74 days it was taking to get homes sold back in 2001. If you recall, we had a similar set of market forces in play back in 2001. At that time, the inventory increase, sales decreased and home prices actually dropped. I would still maintain that a similar correction will have to take place here in order for the market to get back into equilibrium.
When we look at the short term numbers, we see the kind of seasonal changes we would expect. The exception here being that the summer season saw an increase, when we usually see a decrease. Between September and October, the average time it takes to get a home sold increased by 12.2%.
Perhaps the days on market is the key to bringing down prices. Once it takes sellers more time to get their home sold, the only thing left to do is drop the price. The key is having sellers in the market that must sell. It looks as if all these factors are coming together. It seems like only a matter of time before we see a drop in prices county wide as we have seen in some areas.
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