Silicon Valley doubles down on small spaces as market posts gains in condo sector

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MLSLISTINGS, INC. – Four years after the crash, housing’s “new normal” is anything but.

With double-digit price increases and multiple competing offers the talk of the Bay Area single-family home market, Northern California’s Multiple Listing Service (MLS), MLSListings Inc, took a look at San Jose homes in the townhome/condo market over the past year, as well as all of Santa Clara County.
 
“It’s clear that the condo/townhome market is keeping pace with what we’re seeing in single family homes across Silicon Valley and greater Bay Area, with low inventory and rising prices,” said James Harrison, president and CEO of MLSListings Inc.

“Our especially tight rental environment and historically low mortgage rates continue to entice buyers in the condo and townhome sector,” Harrison said.
 
San Jose snapshot

Representing nearly two-thirds of the townhome/condo market for Santa Clara County, San Jose real estate is selling faster, and for more money than the previous three years.

The median price rose above $300,000 in the third quarter 2012 for the first time since the market crash. The median sale price climbed 27 percent, from $252,000 in the thrird quarter 2011, to $319,200 in the third quarter 2012.
 
San Jose’s inventory of homes for sale has fallen even more dramatically.

At 434 units in the third quarter 2012, the San Jose condo/townhome inventory stood at its lowest point in four years, just one-third of what was available during the same quarter in 2008. 


 
Santa Clara County report

In the greater Santa Clara County, the median price of a condo or townhome rose 25 percent in the last year, to $395,000 in the third quarter 2012, nearing the $400,000 mark for the first time since August 2008.

However, current prices still remain about 20 percent below first quarter 2008 levels, when the median price hovered around $510,000.
 
Santa Clara County inventory dropped 65 percent since the third quarter 2008, and this fall there were just 685 units available for sale in the county.

There is little relief from new condos/townhomes coming onto the market; new listings also are at four-year lows, 1,181 units in the third quarter 2012 compared to 1,917 new listings in the same quarter 2008.
 

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