- Low end inventory drops
- Prices flat to April
- Pending sales remain strong across market segments
The inventory of homes priced under $3 million fell 63% in May after spiking in April. May was more of a return to normal. Prices were virtually flat to April but remained above year-ago levels. Pending sales were at or above April’s sales in all market segments. It appears that the Palo Alto real estate market has no intention of slowing down.
The median sales price of a single family detached home in Palo Alto was $2,218,000 in April, which was 2% or $54,500 below April’s $2,272,500. May’s median price was still 6% of $118,000 higher than a year ago. On average, homes sold for 116% of their list price in May, unchanged from April but well above the 11% they sold for in May 2013. The average price per square foot did slip nearly 6% in May, from $2,393 in April to $1,327. One year ago, the average was $1,096, 21% below May’s average.
After doubling last month, closed sales fell by one home, from 46 in April to 45 in May. 45 sales also closed in May 2013. Closed sales have been higher than a year earlier in three of the past four months.
Pending sales increased 16% to 50 during May, from 43 in April. 14 more sales went into contract in May than a year ago. May was also the fifth consecutive month with an increase in pending sales. Inventory on the other hand fell 30%, from 43 at the end of April to 30 at the end of May. Six fewer homes were actively listed at the end of May than a year ago. Inventory relative to pending sales fell from 1.0 month at the end of April to 0.6 months at the end of May. One month of inventory was available at the end of May 2013.
May’s closed sales were listed for an average of 14 days, up from 12 days in April, but one less day than in May 2013. The average number of days homes have been on the market has been 20 days or less for the past 16 months.
Analysis by Price Range
The market for homes priced under $2 million was very hot in May, with pending sales increasing and inventory decreasing. 27 sales went into contract during May, down from 22 in April. Inventory was cut by more than half, from 13 at the end of April to five at the end of May. While, May’s Inventory was a bit low, April’s was abnormally high. One year ago, eight homes were actively listed. Inventory relative to pending sales was extremely low for this segment. Less than two weeks of inventory was available at the end of May, down from 0.6 months at the end of April. 54% of Palo Alto’s pending sales during May and 17% of its inventory at the end of the month were priced under $2 million.
The inventory of homes in the $2 million to $2,999,999 price range also returned to pre-April levels in May. Four homes were actively listed at the end of May, compared to 11 at the end of April. 15 sales went into contract in this price range, one more than in April. May was the third straight month with double digit pending sales. Inventory relative to pending sales fell from about three weeks at the end of April to about one week at the end of May. This price range accounted for 13% of Paolo Alto’s inventory and 30% of its pending sales.
In the $3 million to $4,999,999 price range, pending sales increased from four in April to seven in May. Inventory was unchanged at 12. That resulted in inventory relative to pending sales dropping from 3.0 months at the end of April to 1.7 months at the end of May. 40% of Palo Alto’s inventory at the end of May and 14% of its pending sales during the month were in this price range.
There was no change from April in inventory or pending sales in the $5 million to $6,999,999 market segment. Four properties were on the market at the end of May and one sale went into contract during the month. This price range made up 13% of Palo Alto’s inventory but only 2% of its pending sales.
No sales of homes price at $7 million-plus went into contract in May, compared to two in April. Five homes were actively listed at the end of May, two more than at the end of April. 17% of the inventory in Paolo Alto was in this segment.