Is it a good time to buy?

This seems to be the question du jour from my friends. This came up again during lunch when a friend asked if he should consider buying now. I tried various ways and reasons why I believe it is a good time to purchase by introducing reasons why buyers may have an advantage now: market has an abundance of inventory; sellers are getting into trouble due to high unemployment rate in California and in Silicon Valley thus, having to sell; distressed sales are resulting in homeowners becoming renters and the rental market is now exploding; very low interest rates; spring time selling cycle is here again. All of these mean that the buyers will have an advantage. But the look on my friend's face was that of a person who was not convinced after all of that talk. I know he believed me, but I must have lost him somewhere between unemployment and rental market. Glossy look; a new approach was needed.


I decided rather than the anecdotal approach, especially this friend and others like him in Silicon Valley who are engineers, I thought the best method would be to show them the numbers. No further explanation would be needed. I don't want to be the recipient of that look again.......


Not even a year ago, it was still common in many of the highly sought after communities in Silicon Valley to get multiple offer and sell above asking price. Is it a good time to buy? Well, let's look at the data. Let's focus particularly on the column that is labeled %LP Rec'd (percentage of Listing Price received); what percentage of the listing price did the seller receive?

Overall for Santa Clara County, last month, listings in every single city sold for less than what the sellers wanted (except for condos in Gilroy). Look at some of the higher priced communities like Saratoga and Los Altos Hills (90% and 88%, respectively). It was very common for properties in Saratoga to sell easily for 5% over list price with multiple offers within days of hitting the market.






Is it a good time to buy? What do you think?





Steve Mun, Silicon Valley Realtor
www.stevemungroup.com