Almaden Valley of San Jose, CA follows a traditional spring to fall sales cycle with the peak number of sales in early summer. Closed sales typically peak in May or June with about 38-40 homes in this peak month. This cycle is driven by the first day of school starting mid-August.
Almaden Valley Real Estate Trends
How has the Almaden Valley market recently performed?
With the extremely low housing inventory experienced in all areas of San Jose in late 2017 and early 2018 (see yellow line in below chart), homes for sale in Almaden Valley experienced multiple offers. This low inventory and strong demand spurred a quick increase in home prices. Note the reverse in the typical trend with the yellow inventory line lower than the green sales line from February 2017 through June 2018. During this period, more sales were happening than inventory available at one time due to the quick days on market. This unusual occurrence showed how unique and active the market was during this time.
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. This kept prices low in 2019.
2020 started off as an extremely healthy market with drastically increasing pending sales and a strong number of home sale closings in February, March and April. But the effect of Shelter-in-place (which started locally on March 17, 2020) showed up in the April pending sales numbers and the May closings. May 2020 pending sales were back to normal Almaden Valley seasonal levels and sales held strong through the end of 2020.
The first quarter of 2021 started off very strong with intense buyer demand and low inventory creating overbidding. Q1 ’21 put 82 homes in contract when the average for January through March in Almaden is 71. The extra strong sales demand combined with record low supply resulted in a sharp increase in area prices, taking Almaden Valley properties to record price levels.
What are Almaden Valley prices?
The median home price in March 2021 for Almaden Valley was $1,915,000. The average price in this same month (March 2021) was $1,887,660. The average sales price to list price ratio hit a record high of 112.2% of asking price.
Compared to the Almaden Valley peak prices of mid 2018, (June 2018 median of $1,750,000), the market today is up $165,000. Please note that prices in Almaden are cyclical with peak prices typically in the late spring. To see the general direction of market prices, please refer to the fuchsia dotted line which depicts the 6-month rolling average of the median price. March 2021 closed median prices are up 6.4% year over year.
For current month market statistics and metrics, visit the raw data below or watch my monthly Almaden market update video.
Which direction is the Almaden Valley real estate market trending?
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. This metric quantifies how long it would take to sell all available homes on the market. As of March 2021, the DOI in Almaden Valley is down to 9 days. This intense sellers’ market is likely going to slow a bit with increase of inventory in April, May and June. Until there is a significant increase in inventory though, I expect prices to continue to appreciate.
What is the market outlook?
The overall trend of the Almaden Valley real estate market is positive moving forward. Almaden Valley is a sought-after neighborhood for families looking for good public schools and an outdoor lifestyle. I expect the current market to hold value in 2021 and possibly even appreciate some more depending on the supply and demand balance.
This prediction is based on the metrics below in conjunction with continued historically low interest rates. Even though unemployment levels are still up due to COVID-19 shutdowns, high-tech-employed home buyers can afford Almaden Valley and are mostly working remotely for their jobs. The larger lots and views of the hills plus numerous corporate development projects in downtown San Jose (less than 10 miles away) continue to bring home buyers to the area.
Sellers who have lived in Almaden Valley more than 4 years are experiencing nice equity gains even after the softening experienced in later part of 2018 and into 2019. Buyers are particular about the options in Almaden Valley. Today’s homebuyers are looking for updated and move-in ready homes unless the property is priced very aggressively. Pending sales have been extremely strong in the first quarter of 2021, with a huge 43 pending homes in March, a level not typically seen this early in the season. I expect inventory to increase through Quarter 2 of 2021 and the increased inventory may dampen overbidding.
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