Things are getting interesting in the Santa Clara County real estate market. Inventory has grown and new listings are way down.
February 2023 is not showing the same kind of growth we have seen in past years. Of course, the market a year ago was very different. This is the case since interest rates started their crazy jump in March of 2022. As we review the latest real estate data for Santa Clara County real estate, we will also see if we can predict what kind of market we might see in the coming months.
Santa Clara County Inventory
Inventory has risen 9.7% compared to February of 2022. That is a relatively mild jump compared to some past months. In addition, increases between December 2022 and January 2023 were far less dramatic than the increase between December 2021 and January 2022. In fact, this is a low point in the amount of growth we have seen in inventory for the county.
Santa Clara County New Listings
While YoY the new listings in February 2023 were down by 37%, this was a bigger drop than in January – which is interesting since usually we see an increase in new listings from January to February. Sellers I have talked to will bring up not wanting to buy a new home at current rates since the loan they currently have is in many cases below 3%.
Santa Clara County Homes Sold
The number of sold homes in February of 2023 was down 40% compared to the same time last year. It is also important to note that in addition to a drop in sales, the number of homes sold also is far fewer than the number of homes listed. This resulted in a net of 439 homes being added to the inventory.
Santa Clara County List Price
The original list price of homes – or the amount that sellers first agreed to list their home for – was up 24% (Which is not really the number – what the video for the details on that one!). So this indicates that when compared to the same time last year, the average seller is expecting to make 24% more than a year ago. On average, sellers in February 2023 were expecting their homes to sell for $2,123,401 (Again, NOT real – watch the video!).
Santa Clara County Sales Price
As we discuss sales prices for February of 2023, keep in mind the original list price noted above. Overall, the average price of a home in Santa Clara County dropped by 10.2%. So while sellers are expecting to get MORE than last year, they are – on average – getting 10.2% LESS than last year. This will mean continuing price reductions as homes stay on the market longer and longer. The average sales price was $1,546,546.
Santa Clara County Percent Of List Price
While the original list price gives us some insights into what sellers expectations are, the percent of list price gives us a little insight into what buyers are doing when faced with a list price. In this case, the percent of list price is based on what the listed price of the home was at the time the offer was accepted – not what the price might have been when it was originally listed. In February 2023, sellers were getting and buyers were offering 100.9% of the list price.
In February of 2022, that number was 113.7% – so 13.7% over asking price. Given the growth in inventory, which will put additional stress on sellers to get their homes sold and the continuing trend of sellers to price their homes too high for the current market, we can expect this number to continue to move downward. That is a net drop of 10.2% from last year!
Santa Clara County Days On The Market
There is not much nuance in the data relating to days on market. Since April of 2022, they have simply increased each and every month – until this month. In February 2023, the average days on market stood at 33. That is up 120% from the same time last year. However, it is down from the 35 days on market recorded last month. As I have mentioned before, I think 30 days is kind of a ‘magic’ number. There is a certain psychology to realizing your home has been on the market for a month without selling. At that point, most sellers will start to re-think their list price if they have not already.
On a side not, if you are currently trying to sell your home, please have conversations about list price with your real estate agent at least weekly. You should be paying close attention to how many buyers are viewing, liking, sharing or favoriting your property. How many showings have their been? How many calls for more information. If you have gotten the expected level of attention but no offers or not a level of attention appropriate for your local market, you should consider changing your list price.
Santa Clara County Price Reductions
In February 2023, 19.2% of the homes on the market reduced their price. The average price reduction was $172,827 – which is down from last months $237,717. The median reductions was $100,000 – unchanged from January. The average days on the market for all homes that had a price reduction was 73. The highest was 553 days.
Check out last months analysis
You can also check out the latest Coffee & Real Estate Live Chat for February Below!