- Market outperforms most in the area
- Sales buoyant
- Inventory plunges
- Price indicators rise
- Still a fair amount of uncertainty
Real estate in Palo Alto outperformed most of the surrounding areas. Prices fell in most of the surrounding communities but that was not the case in Palo Alto, where the median sales price, price per square foot and sales price to list price ratio all increased. Inventory was cut in half however. Sales were surprisingly buoyant, with closed sales increasing and pending sales falling only slightly. Even with all that, uncertainty kept some buyers and sellers on the sidelines in December. The uncertainty was caused by questions about the global economy, the presidential election and rising interest rates.
December’s median sales price increased 4%, from $2.5 million in November to $2,607,000 in December. December’s medina was 16% higher than December 2014’s $2.25 million. Also increasing was the price per square foot, which was $1,451 in November and $1,482 in December. That compares to $1,288 a year ago. December’s sales were for 106% of the average list price, up from 102% in November but lower than the 110% from December 2014.
Closed sales surprisingly increased by five units, from 18 in November to 23 in December. There were also 18 closed sales in December 2014.
Two less sales went to contract in December (19) than in November (21). December had three more pending sales than a year ago. Inventory was cut by more than half, from 51 at the end of November to 23 at the end of December. That was the same inventory level as a year earlier. Those changes cut the supply relative to pending sales to 1.2 months at the end of December, comparted to 2.4 months at the end of November and 1.3 months at the end of Decmeber 2014.
December’s closed sales were on the market of 23 days, five more days than in November. One year ago, homes were listed for an average of 18 days.
Analysis by Price Range
26% of Palo Alto’s inventory at the end of December and 32% of its pending sales during the month were priced below $2 million. The inventory of homes in this segment was cut in half to six at the end of December. Pending sales fell by two to six in December. That left a one month supply at the end of December, down from 1.5 months at the end of November.
In the $2 million to $2,999,999 price range, Inventory was cut by more than half, while pending sales increased slightly. Seven homes were actively listed at the end of December, down from 16 at the end of November. Five sales went to contract in December, one more than in November. A 0.9 month supply was available at the end of December, a big cut from the 2.3 month supply at the end of November
The inventory of homes in the $3 million to $4,999,999 price range at the end of December was four homes, less than a third of November’s 14. December’s four units were 17% of Palo Alto’s total inventory. Five sales went pending in December, one more than in November. 26% of total pending sales were in this price range. The relative supply was cut from 3.75 months at the end of November to 0.8 months at the end of December.
There were no sales in the $5 million-plus market segment. Six properties were actively listed at the end of December, two less than at the end of November.