July 13th, 2017 4:05 PM by Mike Frangadakis
Six months ago, there was widespread talk about the flattening of the Bay Area housing market — its red-hot temperature had calmed to a simmer.
That conversation appears to be ancient history. To wit, this example: Alain Pinel agent Mark Wong sent out an email blast Tuesday revealing that around 60 South Bay homes, mostly in Sunnyvale and Cupertino, sold for $200,000 or more over the asking price in the last 30 days. And he wasn’t necessarily talking about fancy schmancy places. One modest Cupertino house — 1,046 square feet — sold for $660,000 above its listing price.
The news from Wong is a snapshot of just how nuts the Silicon Valley market has become this spring as motivated buyers fight over a limited number of homes. The competition is especially fierce in Sunnyvale, because of its proximity to hiring at the new Apple spaceship campus, and Cupertino, which is perennially hot because its schools have a reputation for excellence.
Randomly, here are a few of the numbers in Wong’s email:
A house at 1051 Heatherstone Ave. in Sunnyvale listed at $1,888,000 and sold for $2,370,000 — $482,000 over asking.
A house at 553 Croyden Court in Sunnyvale listed at $1,998,000 and went for $2,450,000 — $462,000 over asking.
A townhouse at 982 La Mesa Terrace, also in Sunnyvale, listed at $1,099,000 and sold for $1,400,000 — $301,000 over asking. For a townhouse.
“The listing price doesn’t mean anything anymore,” Wong said. “It’s just a number.”
“Most of the agents, they love to list under the fair market value, so that’s why it creates an auction-style sale,” he said. “The buyers are smart people. They look around. And when they see a property below the fair market value, they think they’ve found a good deal and they’ll jump on it. Then everybody jumps and it bids up the price.”
Wong compared Sunnyvale and Cupertino sales from the last 30 days to sales in those two cities during the same time period last year.
In Sunnyvale in 2016, 75 houses, condos and townhomes sold during the 30-day period. Of those, 58 sold for more than the listing price, but only eight went for $200,000 or more above asking. This year’s 30-day totals: 84 homes sold, 74 for above asking — including 37 for $200,000 or more above asking.
In Cupertino, these were the 2016 numbers: 60 homes sold, 45 above asking, with five selling for $200,000 or more above the listing price. This year: 60 homes sold, 50 above asking, including 15 for at least $200,000 more than the listing price.
The numbers show “that the competition is much tougher than last year,” Wong said, “and buyers got used to this kind of pricing strategy in purchasing.”
But this is not just a tale of those two cities. Agents recently have reported escalating prices in Mountain View’s Monta Loma neighborhood; priced out buyers have given up and moved down the road to Sunnyvale. Homes have been going for $300,000 over asking in Redwood City and — no surprise here — in Palo Alto.
In the East Bay, Pacific Union agent Carla Buffington said buyers priced out of Oakland’s Rockridge neighborhood simply scoot over to nearby Temescal, while buyers who can’t afford homes in North Berkeley try their luck in the Berkeley Flats. In Oakland, she said, a home in the Fruitvale district recently listed for $789,000; its sale is pending for more than $1 million.
“I feel like everybody has a million dollars,” she quipped. “There’s just a lot of crazy sales.”
Which brings us back to Wong’s email blast.
Its “way over asking” sales in Cupertino include a house at 18625 Ralya Court that listed at $1,299,999 and sold for $1,622,500 — $322,501 over asking. A house at 10384 N. Portal Ave. listed for $1,788,000, then sold for $2,160,000 with 11 offers — a cool $371,200 above the asking price.
Source: http://www.mercurynews.com/2017/07/11/bay-areas-dizzy-real-estate-market-over-asking-bidding-wars-escalate/
Written by: RICHARD SCHEININ