The Numbers
SINGLE FAMILY HOMES
After two months of closings at about 97% of asking price for single-family homes in the Scotts Valley area, October closings came in at a crisp .998 of asking price. That is almost as close to 100% as you can get, and about a 3% difference upwards versus closings in August and September of this year. In other words, homes that closed in October sold for almost exactly what the home sellers were asking for.
There were a total of 17 closings, five more than in September. The average sales price for single family homes was $1,104,456 with average days on market (DOM) of 53. However, two sales closed for $2,950,000 and $1,799,000 respectively, which brought up the average sales price. If you take away those two sales, the average sales price comes down to $938,053. But you can’t give and take away real stats if you want true averages and the true overall average was in fact $1,104,456.
What is even more of a trend is the fact that 8 out of the 17 closings were over $1 million, roughly 47%. This means that higher priced homes are in fact selling quicker than normal, as I have been reporting for some time now. People will pay high dollars to be in the Scotts Valley area. A $1 million home is almost the norm nowadays.
Did home values go up by around $200,000 in just one month? Of course not. This just means that higher priced homes are selling more and this changes the average sales price because you have to factor all sales, lower and higher end, in order to determine a true average sales price. The home that sold for $925,000 two months ago will still sell for about the same, if not a little more depending on inventory, so we are continuing to see a constant and steady appreciation rate. But more and more people are also now buying higher end homes in Scotts Valley with many buyers coming from Silicon Valley looking for a great family neighborhood with great schools and other amenities, which our town has.
There are still single-family homes in the low to mid $700,000 range, and on occasion you will see one lower than $700,000. You just have to be ready, be diligent and be informed of what not only comes on the market, but what “may” come on the market in the near future. Work with a local, knowledgeable and connected REALTOR® so that you know the moment something comes up or could be coming up on the market before anyone else knows about it.
CONDO-TOWNHOUSES
A total of 4 condo-townhouses closed in October with an average of 101% of list price to sales price ratio, meaning they averaged selling at above asking price. That is the norm for condo-townhouses as they are more affordable and the lack of inventory in this sector brings in very high demand.
NEW INVENTORY
The month of October had a low amount of new inventory come on the market, a total of 13 homes went on the market versus 22 in the month of September. That is a substantial drop of about 41%. At this time, about 1 in 3 listings in October are already pending sales.
Look for this trend to continue as we hit the holiday season as homes on the market during the holidays will be limited. With the continued high demand and interest rates that keep dropping, it could be slim pickings for some home buyers looking for a great deal. Traditionally, the holidays meant that homes on the market at that time were desperate sellers and were wiling to reduce the price substantially, but not so much this holiday season.
I think that well priced homes right now and through the end of the year will still sell at or close to asking price, if not more depending on the home and neighborhood.
What’s Hot?
There are a few things that are really in high demand right now. What are they?
THE VINEYARDS: This development is a very desirable neighborhood with nothing on the market right now other than 28 Riesling Way which went pending with multiple offers. The last sale did the same thing. There is a long list of home buyers that want in on this neighborhood. A LONG LIST. And I don’t blame them!
SKYPARK: This community is a hot seller as it is so close to Skypark and within walking distance to shopping, restaurants and entertainment. A well priced and well marketed home in this neighborhood will sell at TOP DOLLAR.
SINGLE STORY HOMES: Many home-owners are looking to buy down in size with single stories being really high on the wish list of many. If you have a single story home in SV, you have something a lot of people want and need!
SINGLE-FAMILY HOMES: Inventory is down at this time and a large percentage of single-family homes on the market are already pending sales. Even hotter are single-family homes under $1 million.
TURN-KEY HOMES: Many home sellers who have bigger homes that are looking to sell and downsize are looking for homes that are in excellent condition and almost move-in ready. I have a fair amount of home owners that are moving down from 2,500+ houses and are looking for 1,500-1,800 square foot homes in excellent condition.
The same holds true for many move-up buyers who are wanting to buy a bigger, more expensive home that is in “ready to move in” condition.
Mortgage Rates Still Low
What can I say about interest rates that has not already been said before? They come down, go up and come down again. Just recently you could get a 30 year fixed rate mortgage under 4% and a 15 year fixed rate mortgage at just over 3%. Depending on the day and the latest news, look for rates to fluctuate up and down, but not too much in either direction. Any way you slice it, rates are just phenomenal.