- Sales fall
- Lower end drives a 77% increase in inventory
- Price indicators rise
- Days on market back down
The Palo Alto real estate market appears to have slowed a bit more in September, although prices don’t really reflect that. Both pending and closed sales fell, while inventory increased. All price indicators increased, however. In addition, homes were on the market a shorter period of time.
September’s median sales price was $2,949,944, a 23% or $549,944 increase over August’s $2,400,000. September’s price was more than $1,000,000 higher than September 2013’s $1,888,000. The median sales price has been over $2 million every month since September 2013, with the exception of January when it missed by only $4,000.
The average price per square foot increased $39 or 3% in September, from $1,376 in August to $1,415. Only one month in at least four years has had a higher average price per square foot ($1,462 in January 2014). One year ago, it was $1,157. Sales closed in September for 112.5% of the list price, little changed from 112.3% in August. This ratio was 108% a year ago.
28 sales closed in September, five less than in August, a 15% drop. That was only one less sale than in September 2013.
Pending sales fell from 40 in August to 24 in September, a 15% drop. September had one more sale than September 2013. Inventory rose 17 units or 77% in September, from 22 at the end of August to 39 at the end of September. That was also five more than were on the market a year ago. A 1.2 month supply of inventory was available at the end of September (relative to pending sales) more than double August’s 0.55 month supply.
After climbing for the past five months, the length homes were on the market fell by 11 days in September, from 26 in August to 15. Homes were listed for nine days in September 2013.
Analysis by Price Range
The sub-$2 million segment is definitely the hottest part of the market in Palo Alto. The inventory of homes priced under $2 million quadrupled to 12 at the end of September. That is the second most homes in this price range this year (April had 13). A year ago, there were eight homes actively listed. Pending sales slipped from 21 in August to 18 in September. 27 sales went to contract a year ago in this segment. 0.7 months of inventory were on the market at the end of September, up from just a few days at the end of August. 53% of Palo Alto’s pending sales during September and 31% of the sales that went to contract during the month were priced under $2 million.
The inventory of homes priced from $2 million to $2,999,999 also increased sharply in September, doubling to 10. That was two more than were available in this segment a year ago. 10 sales went pending during September, two more than in August but one less than a year earlier. Inventory rose to 1.0 month relative to pending sales, from 0.6 months at the end of August. This price range accounted for 27% of inventory and 29% of pending sales in Palo Alto.
Inventory also doubled to 10 units in the $3 million to $4,999,999 price range. That was 26% of Palo Alto’s total supply. 13 homes were actively listed a year ago. Pending sales fell from their 2014 high of nine during August to five in September, accounting for 14% of the city’s sales. A 2.0 month supply was available at the end of September, up from about two weeks at the end of August.
In the $5 million to $6,999,999 price range, both inventory and pending sales were unchanged from August at five and one, respectively. Those numbers represented 13% and 3% of Palo Alto’s totals for September, respectively. 5.0 months’ supply was on the market at the end of September.
There were no pending sales of homes priced at $7 million and up in September, compared to one in August. Inventory was cut in half, from four at the end of August to two at the end of September. That was only 5% of Palo Alto’s total supply.