April 23, 2009

Is Silicon Valley’s housing market ‘leveling off’? – San Jose Mercury News

Is Silicon Valley’s housing market ‘leveling off’? – San Jose Mercury News

Has the Silicon Valley housing market reached a bottom?

No one knows for sure, but figures released Thursday provide some tantalizing clues.

More Silicon Valley homes changed hands last month than in March 2008; it was the fourth consecutive month the county’s sales have outpaced their prior-year levels. And after months of big declines, the median price of the houses sold hovered in the low $400,000s for a third month in a row.

“What we are seeing is signs you would expect to see prior to prices leveling off,” said Andrew LePage of MDA DataQuick, a real estate information firm that released March Bay Area home sales figures Thursday. However, “given all the different countercurrents and all the uncertainty out there, you don’t want to point to three months and say, ‘Ah, we’ve hit bottom.’ “

Although Pralay sent this in a week ago, I figured I’d post it today so that people could spend some more time reflecting on this news, before commenting on it.

Personally, I know from the NAR radio ad (the guy digging, who hits a sprinkler) that you can’t find the bottom. It’s impossible.

But still, this is great news. Now, I might have been too optimistic last year with my predictions, but would I be so off to say that we can expect a healthy 9% YoY appreciationg in 2010? Then back to 15% by 2012 when green tech is in full swing?

Comments (30) -- Posted by: burbed @ 4:46 am

30 Responses to “Is Silicon Valley’s housing market ‘leveling off’? – San Jose Mercury News”

  1. anon Says:

    Two words: Foreclosure moratorium.

  2. DreamT Says:

    A third word: NastyJobLossesYetToCome

  3. anon Says:

    One final thought: cleared for takeoff!

  4. DreamT Says:

    Wise words today: Keep digging: you can’t find a bottom, but you certainly can find a sprinkler.

  5. anon Says:

    Excreter hasn’t posted today.

    From this fact I conclude he is sleeping.

  6. Real Estater Says:

    and anon, you would be wrong as usual. I’ve been on multi-time zone conference call.

  7. DreamT Says:

    anon – Here’s what you should have written:

    “Is Real Estater sleeping?”
    Is Real Estater sleeping?
    No one knows for sure, but lack of early morning postings provide some tantalizing clues.

    “What we are seeing is signs you would expect to see prior to Real Estater waking up”, said Andrew LePage of MDA DataQuick, a real estate information firm that released March Bay Area home sales figures Thursday. However, “given his propense to claim attendance to multi-time zone conference call, you don’t want to point to 10am and say, ‘Ah, he was sleeping and just woke up.'”

    Now that’s much more readable, isn’t it? And accurate.

  8. anon Says:

    “and anon, you would be wrong as usual. I’ve been on multi-time zone conference call.”

    Aww, widdle weal estater still sweeping?

    Maybe the reason you can’t think stems from the fact that you don’t sleep enough.

    ps: nobody gives a shit what you claim you were doing.

  9. A. Lewis Says:

    As an angry renter, you know what I look forward to?

    All the sellers on the sidelines who read this type of news and think, “Maybe I’ll finally put my house on the market – and I’ll actually be able to get bids over asking and get the [wishing] price I want!”.

    And so many of them do this, they totally flood the market with supply, and that results in some HUGE price drops.

    Heh heh heh.

  10. A. Lewis Says:

    Oh, darn HTML interpreter. I tried to make a joke using “” symbols.

    The joke was:

    “”

    But now I have too many quotes, which reminds of this funny blog:

    http://www.unnecessaryquotes.com/

  11. A. Lewis Says:

    Oh good lord, it looked OK in the preview that time. I’m an ignoramus.

    HERE’S THE LAME JOKE – it’s not even a joke, it’s just an image I wanted to go with my ‘heh heh heh’ from above, and now it’s not even slightly funny, I just want to see it in print so I can have closure:

    {vulture continues circling from above, waiting for the crawling figure below to realize it’s dead, and give up}

  12. A. Lewis Says:

    Ah. There. I’m done – sorry to bother you.

  13. Pralay Says:

    and anon, you would be wrong as usual. I’ve been on multi-time zone conference call.
    ——

    RealExcreter,
    Do you think anybody here believe in your mega-project story?

  14. nomadic Says:

    When/if jumbo loans become widely available again, the median will rise and they’ll all say “yay, we found the bottom!” when in actuality the mid-to-high end prices will still be dropping.

  15. anon Says:

    agreed ^^

  16. Real Estater Says:

    anon says,
    >>ps: nobody gives a shit what you claim you were doing.

    You’re the one checking on whether I’m sleeping or not.

  17. Pralay Says:

    You’re the one checking on whether I’m sleeping or not.
    —–

    No, he wasn’t “checking”. He concluded. Again, nobody gives a shit what you claim you were doing.

  18. anon Says:

    “You’re the one checking on whether I’m sleeping or not.”

    No, I’m not. I am merely trying to show you how bad your logic is.

  19. A. Lewis Says:

    #16/18 – Ooooo – I don’t know, I think RE got a good little zinger in here! He’s right – plenty of readers of this blog wait for him to chime in with grist for their mill, or speculate on what it means when he doesn’t comment. Hey, it’s par for the troll-course.

    It doesn’t even come close to justifying anything RE writes, especially little gems like today’s multi-time zone call.

    But just b/c he’s usually wrong doesn’t mean he can’t occasionally be right!

    I mean, you do realize you keep responding to him, right?

  20. I_love_SV Says:

    Wow… There really isn’t a forum/comment section/message board that does not have trolls.

  21. A. Lewis Says:

    #14 – The use of median price is so very misleading so often. The thing that galls me is how the NAR/CAR wouldn’t hesitate to trumpet a RISE in the median values, and use that as their baseline number for how house prices were increasing. It’s what everyone would refer to. Still is.

    But suddenly, when there’s a decrease, it’s “overly influenced by the low-end foreclosures”.

    It’s actually just a dumb statistic, and contrary to an old saying, statistics don’t lie – they’re just wildly abused and misinterpreted (often deliberately).

    The median is the median. It is what it is. A change in the median does NOT mean a change in the value of all houses.

    Now obviously when it goes way up or way down it means SOMETHING – but what?

  22. nomadic Says:

    The use of median price is so very misleading so often.

    Exactly my point.

    .
    Have any of you heard the new CAR commercial on the radio? The one where “California” is talking like Dirty Harry and starts out “you want a piece of me?” It’s more like a mafia guy’s words coming out of Clint Eastwood’s mouth. Odd.

  23. Burbdog Says:

    My interpretation of a rise in the median home price is good and that although there are many forclosures and REO properties selling, home values are begining to trend upwards. The median gives you a good perspective of where the whole market is trending towards. It would be interesting to find out what the previous monthly median and average sales prices were so you could see what the skew looks like and could have a better perspective on this upwards trend.

  24. A. Lewis Says:

    #23 “home values are begining to trend upwards. “

    Did you mean IF you saw the median go up, you would conclude this, or did you mean – you already conclude this right now.

    If so, where would you say this is occurring.

    To me, the basic trend over the entire nation, and over the bay area as a whole, is still decreasing prices.

    I mean, it’s only been a few months since many people even acknowledged price drops in their own neighborhoods – I don’t think it’s over in general!

    Perhaps in the hardest hit areas, it swung SO far down they actually overshot in a short time, and they could be going upwards – but I’m highly skeptical.

  25. Pralay Says:

    Did you mean IF you saw the median go up, you would conclude this, or did you mean – you already conclude this right now.
    —-

    Oh, Lewis! Didn’t you see how words are carefully crafted in #23 so that it talks about only “upwards trend”? He also declared his own “interpretation of a rise in the median home price is good“. He left the interpretation open for downward trend.

    If there is any downward trend it will be interpreted as “mix of properties”.

  26. DreamT Says:

    “Perhaps in the hardest hit areas, it swung SO far down they actually overshot in a short time, and they could be going upwards – but I’m highly skeptical.”

    A., you’ll like this. Scroll down to the chart:
    http://www.zillow.com/homedetails/charts/15584744_zpid,10years_chartDuration/
    That’s one neighborhood in East Palo Alto compared to the whole zip code (which is a mix EPA/PA if I’m not mistaken). Keep in mind that the higher graph is weighted down by the lower graph, as incredible as it sounds.

  27. nomadic Says:

    Even more fun, click on the “percentage” part of the chart!

  28. A. Lewis Says:

    #23/24 – yes – good chart. There is this hint of upturn in the last month – you think it’ll hold up? Have they bottomed in EPA and now the real money can be made!

    Once in a lifetime opportunity in EPA! Buy now!

  29. JC Says:

    When the last housing bubble bust in the late 80’s, it took a good 6-7 yrs for the market to bottom.

    When the last Nasdaq bubble bust, oh well… we are still at the bottom after 9 yrs.

    So, why will this housing bubble, which was far bigger than any others we witnessed, bottom just in 2-3 yrs?

    And remember, when the last housing bubble bust bottomed around 94-95, we had a monstrous transformative technology trend (called Internet) that created a couple of hundred very well paid jobs in the bay area. That helped stop the housing slump that lasted 6-7 yrs.

    What’s there now?

  30. DreamT Says:

    “When the last housing bubble bust in the late 80’s, it took a good 6-7 yrs for the market to bottom.”

    At the time, did it deflate by 70% within eighteen months, as it did in the bay area’s outskirts?


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