As the trend toward normalization continues, the Palo Alto real estate market appears to be resisting the slowdown that typically follows with the end of summer. Sales increased after falling the prior two months and inventory, which had been mostly flat the past three months, dipped in August. The length of time homes were on the market had been slowly rising the past few months but took a step in the other direction in August. Prices held their own as well, with the average sale in August being for more than the list price, extending the city’s streak to five and a half years. However, that was well off the level homes were selling for over the past few years, which was around 110%.
Median Sales Price
On average, sales closed for 102% in August, up from 100% in July but well below the 116% homes sold for a year ago. The price per square foot in August was $1,467, which was $67 higher than in July but $94 lower than in August 2015. The one price indicator that fell in August was the median sales price. It fell $402,000, from $2.8 million in July to $2,398,000 in August. August 2015’s median sales price was $2.6 million.
33 sales closed in August, two more than in July and the same number that closed in August 2015.
For Sale vs. Pending
The inventory of homes for sale here has been on the decline since topping out at 107 in April. At the end of August, 66 homes were actively listed, down 19 from July but still twelve more than were on the market a year ago. Pending sales, which had been trending downward, ticked up in August, from 32 in July to 36, which was three more than in August 2015. Relative to pending sales, inventory fell from 2.7 months at the end of July to 1.8 months at the end of August.
Days to Sell
After bottoming out in March at 16 days, time on the market has been steadily increasing but that changed in August. August’s sales closed in an average of 21 days, down from 27 in July. That was, however, 10 more days than a year ago.
Analysis by Price Range
Under $2 million
After nearly doubling in July, the inventory of homes priced under $2 million was cut almost in half to return to June’s level. 13 homes were actively listed in this segment at the end of August, down from 25 at the end of July. Buyers responded to the increase in inventory last month and drove pending sales up, from six in July to 14 in August. That cut supply from over four months at the end of July less than a month at the end of August. 20% of Palo Alto’s inventory was priced below $2 million, while 39% of pending sales were.
$2 million to $2.99 million
The inventory of homes in the $2 million to $2,999,999 price range was cut sharply in August. 29 of these homes were on the market at the end of July but only 17 were actively listed at the end of August, making up 26% of total inventory. Pending sales, meanwhile, were little changed at 14 during August. That was 39% of total sales. A 1.2 month supply of these home was available at the end of August, down from 1.9 months at the end of July.
$3 million to $4.99 million
While 30% of Palo Alto’s inventory was priced from $3 million to $4,999,999, only 17% of pending sales were in this price rang. Inventory increased form 16 at the end of July to 20 at the end of August. Pending sales fell from 11 in July to six in August. That increased the supply relative to sales from 1.45 months at the end of July to 3.3 months at the end of August.
$5 million or over
16 properties priced at or above $5 million were actively listed at the end of August, while only two sales went to contract in this price range during the month. That compares to an inventory of 16 and zero sales in July. 24% of the city’s inventory was in this segment but only 6% of pending sales.
Check out these other Real Estate Market Conditions Reports for August 2016:
- Los Altos
- Los Altos Hills
- Los Gatos
- Menlo Park
- Mountain View
- Palo Alto
- Santa Cruz