Some interesting pivots in the San Jose real estate market in March of 2023. For the first time in quite a few months, the inventory in San Jose has actually gone DOWN when compared to the same time last year!
That now leaves us with only 1 months worth of inventory in March! If buyer demand rises just a bit, we will quickly see yourselves in a buyers market – and for some parts of San Jose, that has already happened! We are now seeing homes selling for 2.3% ABOVE asking price! So clearly, there is enough buyer demand in the San Jose market to result in multiple offers that are generating these sales prices above list price.
Inventory drops – for the first time in months!.
The San Jose real estate market saw a 11% decrease in inventory when compared to the same time last year. This is a reversal of a months long trend of inventory increasing in San Jose – and across the county . San Jose is very unique in this change as Santa Clara County and the rest of the South County area all saw overall inventory increases.
Interestingly, the San Jose real estate market currently only has 1 month worth of inventory on hand. If we were only looking at that statistic, we would assume we are in a strong seller’s market. Market balance is usually considered to be 4.5-5.5 months of inventory in our area. Given that, it becomes clear that it would take a very minor increase in buyer activity to flip this market strongly toward sellers.
New Listings Down.
New listings are down compared to the same time last year – so fewer sellers are willing to put their home on the market. With a 38% drop in new listings – and a drop in the number of homes sold, San Jose added just 202 homes to the market.
The San Jose real estate market saw a drop of 43% of homes sold when comparing to the same time last year. It will be interesting to continue to monitor these numbers from here on since March was the month when interest rates began their dramatic rise.
This month, the number of homes that went into a contract for sale declined by 44% when compared to the same time last year. That gave us 510 sellers that accepted an offer on their home. Keep an eye out for homes sold numbers next month to see how many of them actually ended up closing escrow and resulting in a sold home. This is a crucial metric to watch, as it can give us a better idea of how the market is performing in terms of actual sales.
Sellers continue to expect to get more for their homes than they did last year. The average home list price was up 5.3% compared to the same time last year. This is down from last month’s 6.3% increase in what sellers were expecting to get for their home. This is a clear indication that sellers are still feeling confident about the market and are believe their homes appreciation is perhaps more than what the market will actually withstand.
While seller expectations increased over the year, actual sales prices decreased by 9.2% over the year. The good news is that sellers in the San Jose real estate market seem to be getting better calibrated to the correct market values in today’s values. However, given that big drop in average sales price, there is clearly more to be done here. Sellers need to be more realistic about the prices they are asking for their homes, especially in a market where there is such a low inventory.
Percent Of List Price.
Sellers have been seeing their homes sell for 102.3% of asking price – down from 111.8% at the same time last year. This is the second month in a row when sellers have been getting over asking price in San Jose. This indicates that at least in some parts of San Jose, homes are getting multiple offers and buyers are willing to pay a premium.
Days On Market.
It is taking 127% longer for home to sell in this month than at the same time last year. That comes to 25 days this year and just 11 days during the same month last year. On a month to month basis, this is down but is also what we would expect at this time of the year.
Source: All data is extracted from the MLS system for Santa Clara County – mlslisting.com
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