Almaden Valley of San Jose, CA follows a traditional spring to fall sales cycle with peak sales in early summer, primarily due to its focus on schools. This cycle is driven by the first day of school for the new year starting mid-August.
Almaden Valley Real Estate Trends
What is the Direction of the Almaden Valley Real Estate Trends?
With the extremely low inventory experienced in all areas of San Jose in late 2017 and early 2018 (see yellow line in below chart), Almaden Valley experienced multiple offers which spurred a quick increase in home prices. PRICES in Almaden Valley peaked in January 2018 and then an even higher average price peak in June 2018 with $1,911,940 topping the average sales 2019 price in June 2018.
OVERBIDDING was commonplace in 2017 and 2018 with the peak sales price to list price ratio of 111.7% in February 2018. May 2018 marked the peak numbers of home SALES in Almaden Valley since January 2015 with 44 sales closed.
In late summer of 2018, these record high prices plus increasing interest rates had buyers waiting on the sidelines and the number of sales decreasing earlier than typical in the year’s sales cycle. This late summer/early fall season in 2018 felt like an early winter and prices softened the rest of 2018 as a result of the decreased sale activity.
Spring 2019 in Almaden Valley started off as a typical sales season with ramping inventory and increasing sales. In April 2019, inventory continued to increase as usual, but sales slowed down to the lowest number for April in the past 5 years. The lower sales trend continued through May, June and July, creating a larger stock of homes available for sale. The 2019 inventory curve through July looks very similar to 2016, but sales in 2016 were much stronger.
As a result of the lower sales and higher inventory, prices remain relatively flat in Almaden Valley.
What is the CURRENT average price?
The average PRICE in July 2019 for Almaden Valley was $1,707,550 skewed by 5 large sales among only 27 closings. The median price in July 2019 was $1,550,000 with an average sales price to list price ratio of 99.7% of asking price. Compared to the Almaden Valley market peak of June 2018 ($1,911,940), the market today is down. For current month market statistics and metrics, visit the raw data below.
Which direction is the market trending?
Sales in Almaden Valley have been lower than typical for the last several months of 2019. After the inventory shortage of late 2017/early 2018, the Almaden Valley market has seen increased inventory compounded by less sales than in recent years.
Days of Inventory (DOI) is a monthly metric I follow to understand the speed and direction of the market. Days of inventory is a simple calculation using the inventory and current rate of sales to understand how long it would take to sell all available homes. Around 90 days of inventory is a neutral market where negotiation power moves from sellers (under 90 DOI) to buyers (over 90 DOI). Certainly, this is not an exact line bit rather a gray zone or general guideline. As of July 2019, the DOI in Almaden Valley is 66 days. If inventory continues to increase while sales stay flat, the DOI metric will increase and buyers will gain more negotiating power.
As of July 2019, average prices are still 10% below the peak of June 2018. Using some minute perspective when analyzing the average price in Almaden, I compared July 2017 to July 2019 (only 2 years) and the average price in Almaden Valley has still INCREASED 10%! This data and perspective lead me to believe that early 2018 prices in Almaden were inflated due to lack of supply and high demand.
Since the Almaden Valley market is back to higher inventory following a typical seasonal cycle, the market intensity has settled. Consequently, I expect prices to hold steady or experience only modest appreciation in the near future. Certainly a housing market that has experienced extremely healthy appreciation over the last 10 years could use a few years of stability!
What is the market outlook?
The overall trend of the Almaden Valley market is positive moving forward. Almaden Valley is still a sought-after neighborhood for families looking for good public schools and an outdoor lifestyle. I expect the current healthy balanced market to conservatively appreciate in 2019 with continued historically low interest rates, low county-wide unemployment and numerous corporate development projects in downtown San Jose (less than 10 miles away).
Sellers who have lived in Almaden Valley more than 2 years are experiencing large equity gains even after the softening experienced in later part of 2018. Buyers are happy to see a more balanced market and continue to invest in the area.
This article on Almaden Valley real estate trends is updated once a quarter. Would you like to hear a monthly update on the market statistics? Visit my YouTube channel for Almaden specific updates.
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- Study the raw data yourself below. With Theresa’s engineering background and experience in San Jose since 2004, she gladly discusses market statistics with her clients. See below Almaden Valley real estate specific statistics and contact Theresa for a personal discussion on these stats.
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