In a recent blog post we reported on First Quarter 2011 trends for the communities in which we work.  We thought you might be interested in delving deeper. 

 We noted that Palo Alto can now be described as a “Seller’s Market”, one in which buyer demand exceeds the supply of available homes.  The graph below depicts market trends for single family homes in Palo Alto from February, 2010 through April, 2011.

 In the past 14 months the supply of available homes (light green bar) has dramatically decreased as the number of sales (red line) has increased.   These are called “pending sales” which means that a seller has accepted a buyer’s offer, but the transaction has not yet closed escrow.  The dark green bar shows the number of homes “Sold”, or closed escrows.  Note that during the month of April all categories are hovering at around 60, which means that the market is absorbing the available homes as they come on the market.  Future blog entries will address some of the characteristics of a “Seller’s Market” .

Palo Alto Q1 2011

The below graph for Menlo Park reflects the same time period.  Just as in Palo Alto, inventory has decreased from 2010 levels however, as the Spring market has evolved, more inventory has come on the market.  While the number of pending sales has increased , there is still a supply of homes for sale.  In March 2011, there were 67 homes for sale, 31 became pending sales and 30 close escrow.  This approximates a 2-month supply of inventory.  Inventory levels rose in April, while the number of pending sales increased at an even higher level.  If this trend continues, Menlo Park’s market conditions may also be described as a “Seller’s Market”.

Understanding market trends is vital to both sellers and buyers as they plan their strategies for navigating the real estate market, and this is the type of information we like to provide our clients so that they can make sound and informed decisions.

Menlo Park Q1 2011