House and Condo Sales in Silicon Valley Show Gain for December

This is good news and bad news, but mostly good news! House values are related to House sales. It’s Economics 101 really. There is a demand for houses, albeit cheap houses. The supply is very limited right now. When demand outweighs supply this means the price for that product go up.

For example, remember those little Razor scooters? When they first came out every kid in America wanted one and they just flew off the shelves! When they first came out those little suckers cost around $150 right out of the box (even more if you bought accessories).

As time went on the price went down because eventually the scooter market was flooded with alternative brands, cheaper quality Chinese knock-offs, and an over-all disinterest. Now you can get them for $20 almost anywhere. What’s my point? The demand went down because there was a high supply, as a result the price was reduced.

SO currently people are looking to buy, there is a demand for houses not only in Santa Clara County but nationwide. As a result of the housing crash many people are looking to get a good deal. This means that houses are like those Razor scooters, they’re FLYING off the shelves err…market. Unlike Razor scooters though, there is always a need for houses.

Values

In October and November of 2009 the median house price in Santa Clara County was said to be $550,000. In 2007, before the bubble burst, it was $805,500. The San Jose Mercury News reported today that house and condo sale prices for December 2009 are just over $550,000 as compared to $525,000 in December of 2008.

What do all these numbers mean? Well for starters it shows that home values in Santa Clara County have increased from 2008 to 2009, however they are still not what they once were. This can be interpreted by some as the real estate market stabilizing, man I sure hope so. Let’s see how this affects home purchases…

House Sales

What it comes down to for home buyers is this…if you’re thinking of buying a house, buy one. There are so many programs out there for first time home buyers it’s ridiculous (See my list of Government Down Payment Programs in the Bay Area). Ridiculously good that is.   In Silicon Vally this past December house sales were up 44% compared to the year before. Supply is going to start running low as the demand for a decently priced house starts to devour the Bay Area inventory.

Bottom Line

The demand seems like it is increasing, will it continue? You tell me!  BOTTOM LINE house prices are low right now and they’re showing a slow but steady increase. If this is the best time to buy, the window of opportunity may be slipping away. It does not mean that you won’t be able to buy a house in the future, it simply means that it may cost you more to get into the house you want.

This is just how I see it, these are the trends and I’m not the only one calling them out. What do you think? Any thoughts or challenges?

I just delivered the update, it’s up to you what you make of it.

No related posts.