- Market catches its breath
- Inventory increases
- Sales fall
- Prices down
After a February that was very hot, the Los Alto Hills real estate market paused to catch its breath in March. With inventory increasing and sale and prices falling, it bucked the trend of what we saw in the surrounding communities. I don’t read much into that, as the market can be volatile with the generally low number of transactions here (On average, less than nine closed sales a month for the past two years).
The median sales price in March fell $250,000 from February to $3,450,000 in March, a 7% decline. That was still 6% higher than March 2014’s $3,260,000. The price per square foot fell from $1,243 in February to $1,105 in March, a loss of $138 or 11%. On average, sales closed for 108% of their list price in March, down from 113% in February but up from 104% a year ago. March’s 108% is still very high, especially when we consider that February’s ratio was the highest here in at least ten years.
Three fewer sales closed in March (eight) than February (eleven). Eight is not bad though, given that there were four in January and the average for the past two years is nine.
The biggest surprise of the month is that pending sales slipped in March. Nine sales went to contract during the month, compared to 12 in February and nine a year ago. Los Altos Hills was the only community in the area with a decline in pending sales. Inventory increased by five homes, from 19 at the end of February to 24 at the end of March. 21 homes were actively listed a year ago. Inventory relative to pending sales increased from 1.6 months at the end of February to 2.6 months at the end of March.
Properties were on the market for an average of 50 days in March, double February’s 24.
Analysis by Price Range
The market for homes priced under $3 million showed the greatest weakness in March. Inventory increased four units, from five at the end of February to nine at the end of March. Pending sales were cut in half to three in March. That left a 3.0 month supply available, up from less than a month at the end of February. 38% of Los Altos Hills’ inventory and 33% of its pending sales were priced under $3 million.
Only two sales of homes priced from $3 million to $4,999,999 went to contract in March, down from five in February. Inventory was unchanged at seven, leaving a 3.5 month supply in this segment. This price range accounted for 29% of inventory and 22% of pending sales.
The $5 million-plus home market showed the most strength, with four pending sales, the most in this segment in almost three years. Only one sale went pending in February. Inventory increased one unit to end March with eight. That represented a 2.0 month supply. 33% of the city’s inventory at the end of March and 44% of its pending sales during the month were in this segment.