November 2012 — Inventory at its Lowest Since January

The latest annual Home Listing Report published by Coldwell Banker last month compared the average prices of 4-bedroom/2-bathroom homes in 2,500 communities around the country. Thanks to the booming high-tech economy, six out of the ten priciest communities are right here in the Bay Area.

Los Altos ended up at the top of the list with an average price of $1,706,688.Palo Alto was rated fifth with average home price of $1,495,364. Other Bay Area cities in the top ten were Saratoga, Menlo Park, Los Gatos and San Carlos.

Palo Alto is still experiencing a strong seller’s market. While only 27 single family homes were listed during the month, there were 37 new contracts accepted, driving inventory down from 52 units in October to 34 in November.

It took on average only 20 days for a home to sell — a 20% decrease from the previous month and a 35% drop from November of 2011. Multiple offers are commonplace and the winning bids are often submitted with no contingencies even when loans are involved. Record-low interest rates help fuel the activity.

In December we expect the high level of activity to continue. Many sellers are trying to close before the end of the year to take advantage of the current capital gains tax rates. This situation puts the burden on buyers to demonstrate their ability to close on time. Working with a qualified lender experienced in the purchasing process in the area helps buyers to secure properties of their choice.

Michael Talis is co-owner of TALIS Real Estate.