The Palo Alto real estate market cooled off a bit in June, in what appears to be a trend toward “normalcy” after the blistering pace and double digit price increases of the past few years. Price indicators softened in June and homes were on the market a little longer. Pending sales declined after hitting a four year high in May. The market appears to be shifting toward a more favorable environment for buyers. There have even been a number of contingent offers, something we have not seen much of for quite some time.
Median Sales Price
June’s median sales price fell 7.5% of about $200,000 in June to $2,510,000. That was also nearly 9% below the median price from a year ago. The median sales price has been below the level of a year earlier for six of the past seven months. Prior to that, the price had increased year-over-year for the prior 23 months at an average rate of 16%. Homes sold in June for 102% of their list price, on average, down from 104% in May and 112% a year ago. The price per square foot eked out a small $4 gain to $1,470 in June. That was also a $34 increase from June 2015’s $1,436.
31 sales closed in June, 14 less than in May but the same number as in June 2015.
For Sale vs. Pended
Pending sales fell from a four year high in May of 49 to 40 in June. That was the second most since April of last year. Inventory fell again in June, from 82 at the end of May to 74 at the end of June. That was still 11 more than were available a year ago. Inventory relative to pending sales increased from 1.7 months at the end of May to 1.85 months at the end of May. We had a 2.0 month supply at the end of June 2015.
Days to Sell
For the third consecutive month, homes were on the market longer than 20 days. The average sale in June closed in 26 days, compared to 23 days in May and 13 days a year ago. The average for the 12 months prior to April of this year was only 19 days.
Analysis by Price Range
Under $2 million
12 homes priced under $2 million were actively listed at the end of June and eight sales went to contract during the month. Both those numbers were tow less than during May. A 1.5 month supply of these homes was on the market at the end of June, compared to 1.4 months at the end of May. This segment accounted for 16% of Palo Alto’s inventory and 20% of its pending sales.
$2 million to $2,999,999
More sales went to contract in the $2 million to $2,999,999 price range than any other during June. 19 sales went pending during the month, 47.5% of all sales here. 22 homes were available for sale at the end of June, two less than at the end of May. 30% of all inventory was in this price range. A 1.2 month supply was on the market at the end of June, little changed from May.
$3 million to $4,999,999
31% of Palo Alto’s inventory and 22% of its pending sales were priced from $3 million to $4,999,999. 23 homes were for sale at the end of June, down four from May. Nine sales went pending in this category in June, two less than in May. Supply was virtually unchanged at 2.5 months.
$5 million or over
There was no change in the inventory of homes priced at or above $5 million (17). Those 17 homes were 23% of the total supply. Pending sales fell from seven in May to three in June, representing 10% of all sales. Supply increased from 2.4 months at the end of May to 4.3 months at the end of June.
Check out these other Real Estate Market Conditions Reports for June 2016: