San Mateo County Market Rebounds - July 2020 Report

Demand for luxury homes has been very high, as reflected in the next 2 charts. This has certainly been one factor in the rise in the median house sales price in Q2. 

The number of active listings on the market has also bounced back, and is now slightly above the level seen last year. 

Three angles on San Mateo County house values: quarterly median sales price and average dollar per square foot values, and a longer-term perspective. 

Around the Bay Area, condo markets have not performed quite as well as house markets, in either market demand or median sales price trends.

Average days on market were the same on a year-over-year basis (and relatively low).

Overbidding asking price has become less common. Part of this is due to changes in home showing rules, which make multiple offers less likely. 

Below is a breakdown of home sales by city and bedroom count. 

The Bay Area markets with the largest year-over-year increases in the number of listings accepting offers in June 2020 were the 4 outer Bay Area counties of Monterey (up 61%), Santa Cruz (58%), Sonoma (47%) and Napa (37%). They also have among the lowest population densities in the Bay Area. The more urban counties saw more modest y-o-y increases: San Francisco (6%) and Alameda (7%). San Mateo County was between those 2 poles. 

What we call the Stanford Circle of cities, on either side of the San Mateo/Santa Clara county line, is the most expensive regional market in the Bay Area - though there are other cities that are very affluent and expensive. Below is a snapshot of home sales there.

The first thing to remember is that there is a time lag - usually 3 to 6+ weeks - between a new listing coming on market, an offer being negotiated and accepted, and when the transaction actually closes sale. This means that almost all of the sales price data we have, as of the first week of April, still reflects the market BEFORE the shelter-in-place rules went into effect. In virtually all Bay Area counties, March median sales prices were quite strong. 

These first 3 charts review median sales price trends in the short, medium and long-term. March and first quarter prices generally reflect the pre-crisis market. 

The following 4 charts detail the plunge in listing and accepted-offer activity, and the surge in listings being pulled off the market by sellers, over the past 4 weeks. Typically, at this time of year, the first 3 charts would be seeing steady climbs over February numbers, and the 4th chart would have a very low, flat trend line. Though the numbers are way down, some listings have still been going into contract.

Those listings that did go into contract in March - a much lower number than normal - apparently did so quite quickly after coming on market, presumably seizing the attention of buyers despite the crisis. Or the buyers and sellers may already have been in the midst of negotiations when shelter in place rules began.

The luxury market is fiercely seasonal, and typically spring (Q2) sees the peak in annual sales volumes. Higher-price home sales are often more deeply affected by financial-market crises since affluent households tend to have more wealth tied up in the markets, and watch their movements more closely. 

Weekly changes in the luxury and ultra-luxury home markets. 

There is a lot going on in the world right now and we won’t pretend to know how things will turn out or affect the local real estate market over the next few months. In the meantime, this report will look at the most recent data available, though the impact of the wild volatility in the financial markets and the unfolding situation with the coronavirus has yet to show up in reliable statistics. Typically, the spring selling season is the most active of the year. 

It is impossible to know how median and average value statistics apply to any particular home without a specific comparative market analysis.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in San Francisco and the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term. 

Generally speaking, after years of high appreciation rates, annual 2019 Bay Area median home prices went down a little bit, went up a little bit or basically remained unchanged as compared to 2018. San Mateo County was one of the markets that saw no year-over-year change.

Median sales prices are generalities and not exact measurements of changes in fair market value. They can be affected by a number of factors and are sometimes subject to anomalous fluctuations. This is especially true of very affluent communities - such as Atherton, Woodside and Portola Valley - that have relatively few sales across a very wide range of sales prices. 

San Mateo & San Francisco have been alternating for the highest median house sales price in the Bay Area. In Q3, SF took first place.

This next chart looks at estimated percentage appreciation since 2012 in the most expensive markets of the 2 counties. This graph does not delineate prices, which vary enormously, only percentage home price changes over time. According to this calculation, the last peak in prices occurred in the first half of 2018. 

San Mateo is not one of the largest markets in the Bay Area by number of sales (see pie chart above), but it is the largest market for homes selling for $5,000,000 or more.

The market is now deep into its seasonal plunge in activity, which hits its nadir in December. 

The following charts reflect estimated calculations of median home price trends  since 1996 by an algorithm created for that purpose.  As always, these numbers should be considered very general approximations of prices in complex markets containing homes of widely varying size and quality.