HIGHLIGHTS for May 2010
– Home sales increased, year-over-year, by 8.5% in May. Year-to-date, home sales are up 26.7%.
– The median price for single-family, re-sale homes gained 4.5% from April, down 35.8% year-over-year.
– Days of Inventory now stands at 93.
The aftermath of the Fed tax credit, which expired April 30th, won’t be completely known until the end of June. Although the tax credit expired at the end of April, when buyers needed to be in escrow, buyers have until June 30th to close the sale.
The effect of the tax credit was complicated by the new state tax credit which started May 1st. Many buyers delayed escrow so they could take advantage of both credits, stealing sales from April, down 1.4% year-over-year, and pushing them into May, where home sales were up 21.1% year-over-year.
Pending home sales, goosed by the tax credits, continued to be near the record high recorded in April. We expect home sales to be strong in June.
The median price for single-family, re-sale homes edged upward in May by 0.2% from April. It was up 29.1% from last May. This is the eighth month in a row the median price has been higher than the year before.
Although inventory grew 2.4% from April, it was down 19% year-over-year. This is the eighteenth month in a row inventory has been lower than the year before, putting upward pressure on prices.
The sales price to list price ratio stayed over 100% for the eleventh month in a row: 100.9%. This signifies that well-priced homes in the best areas are receiving multiple offers.
ARE WE THERE YET?
If the previous numbers don’t convince you the real estate market in Santa Clara County has bottomed out, let’s look at some other statistics.
First, foreclosures levels: they dipped by 2% in April year-over-year. That’s the first annual decrease in more than five years, according to report issuer RealtyTrac.
Second, shorter marketing time: in May, average days on market was 39. That’s the shortest time since July 2007.
Third, Case-Shiller Home Price Index: often considered the gold standard for real estate statistics, the index for the San Francisco Bay Area was up for the eleventh month in a row, according to their latest statistics reported for March 2010. I expect when they report on April and May, we will see the index continue rising.