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The Last 30 days (Oct'06 Edition)
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October 23, 2006
 
The Last 30 days (Oct'06 Edition) 
 
(c) copyright View from Silicon Valley, 2006.  All rights reserved.
 
 
Are we in the last days of the Silicon Valley real estate boom?  It's impossible to say with certainty but one way to gain insight is looking at the numbers.
 
Back in March (2006) we documented median house prices in Silicon Valley make most of their annual increases from February to April.  We found the six months starting July showed median price changes of: +0.0% (2003); +1.6% (2004) and -0.9%  (2005) over the last three years.
 
So how are prices doing lately?
 
Re-creating our "The Next 60 days'" table, using the local paper's figures for "Total Resale Homes":
 
 
Median +/-$   2003    2004    2005    2006
January       -$4K   -$47K     -0-    +$1K
February      +$7K   +$52K   +$22K   +$17K 
March        -$10K   +$39K   +$33K   +$12K 
April        +$15K   +$11K   +$17K   -$10K 
May           -$4K   +$15K    +$8K   +$27K
June         +$29K    +$9K   +$15K   +$15K
July         -$24K    -$9K    -$5K   -$20K
August       +$17K    -0-    +$14K   -$27K
September     -$3K    +$5K    -$9K   +$10K <= +$25K YTD
October      +$10K    +$5K    +$9K
November       -0-    -0-     +$1K
December       -0-   +$10K   -$15K
Total        +$43K   +$90K   +$90K
 
Comparing YTD numbers for the last four years, we find
 
YTD thru   2003    2004    2005    2006 
Sept.     +$23K   +$75K   +$95K   +$25K
 
Let's peek at YTD volume over the last few years. 
 
Resales Sold  2003    2004    2005   2006
September    1,945   1,865   1,759  1,192
YTD         14,895  17,594  15,873 11,852
 
Y-o-y volume is negative for the 22nd straight month (since December, 2004) and 25th out of the last 26.  (Putting the volume peak at August, 2004.)
 
The monthly realtors' blurbs only focus on volume and price vs. last year (y-o-y).
 
To make thinks a little more interesting, let's invent a "new" statistic "year-over-two-years-ago" or "y-o-2y":
 
Resale Units  2003   2004   2005   2006  y-o-y    y-o-2y
September    1,945  1,865  1,759  1,192  -32.2%   -36.1%
YTD         14,895 17,594 15,873 11,852  -25.3%   -32.6%
 
 
Part of the rationale for ignoring y-o-y (and even y-o-2y) volume is the claim there aren't enough properties for sale.  The latest figures for single-family homes are:
 
January 12  1,687
February 9  1,818
March 9     2,103
April 9     2,194
May 7       2,606
June 8      2,974
July 6      3,185 
August 10   3,389
September 7 3,401
October 5   3,389  (+100.9%)
 
We believe this understates the actual available volume since the MLS for Santa Clara County currently lists 3,985 single-family homes in Santa Clara County (as of October 21, 2006).
 
Breaking down the details: 
                                Peak   Since 
All Homes    *Current Peak    Date    Peak     y-o-y 
Santa Clara Co. $675K  $690K  Jul26'06  -2.2%   +2.3%
San Mateo Co.   $767K  $775K  Jul20'05  -1.0%   -2.0%
Santa Cruz Co.  $702K  $720K  May26'05  -2.5%   +3.2%
 
Resale Homes
Santa Clara Co. $735K  $772K  Jul20'06  -4.8%   +4.3%
San Mateo Co.   $802K  $830K  Aug11'05  -3.4%   -1.8%
Santa Cruz Co.  $748K  $775K  Nov04'05  -3.5%   +1.1%
 
*= through September 26
 
 San Mateo and Santa Cruz numbers are much more volatile than Santa Clara County.  They bounce, up and down, on lower volume, more than Santa Clara County on a regular basis.
* * * * *  
 
"All Homes" y-o-y price:
 
       SantaClara SanMateo SantaCruz
        County     County    County    
Dec'05  14.8%      12.5%     17.4%
Jan     15.5%       8.2%     13.5%
Feb     14.2%       6.4%     12.6%
Mar     10.2%       3.4%      8.0%
Apr      6.3%      -0.1%     11.5%
May      7.0%       3.4%      8.3%
June     4.7%       2.6%      0.0%
July     3.9%      -0.1%     -3.6%
August   1.7%      -2.0%     -3.5%
Sept. *  2.3%      -2.0%      3.2%
*= thru September 26
 
 
"Resale Homes" y-o-y price:
 
      SantaClara SanMateo SantaCruz
       County      County    County    
Dec'05  16.5%      10.7%     10.9%
Jan     13.6%      10.8%      4.7%
Feb     13.0%       5.7%     -0.3%
Mar     10.6%       3.8%      3.8%
Apr      5.1%       2.5%     10.8%
May      9.4%       2.0%      5.7%
June     9.2%       1.9%      5.7% 
July     7.1%       1.9%      1.2%
August   2.8%       1.9%     -2.3%
Sept.    4.3%      -1.8%      1.1%
 
 
Bottom Line:   
We have first-hand experience with it.  A large part of why this web site exists because of the truth behind the old adage about how one can deceive people with, "Lies, damn lies and statistics."
 
Until further notice, the above will be offered without commentary, editorial, ranting, raving nor even snarky sarcasm.  (Of course, we also reserve the right to change our mind.)
 
We hope you enjoy the data!
 
 * * * * *
The above is not intended as advice to buy, sell or hold any stock, bond, real estate nor any other financial product or service.  Invest at your own risk.