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The Last 30 Days (Feb'07 Edition)
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February 23, 2007 
 
The Last 30 days (Feb'07 Edition) 
 
(c) copyright View from Silicon Valley, 2007.  All rights reserved.
 
 
 
House prices in Silicon Valley make most of their annual increases in the spring.  Since 2003, prices after June 1 showed a median change of:
 
2003:   0.0% 
2004: +1.8%
2005:  -0.7%
2006:  -7.8%  (= -$60K!!) 
2007:  TBD 
 
So how are prices doing lately?
 
In short, Santa Clara County ended 2006 on a very weak note.  December was so bad that it brought the YTD gain all the way down to only +$5K.
 
Updating the "The Next 60 days'" table for "Total Resale Homes":
 
 
Median +/-$   2003    2004    2005    2006    2007 
January       -$4K   -$47K     -0-    +$5K    -$3K
February      +$7K   +$52K   +$22K   +$17K 
March        -$10K   +$39K   +$33K   +$13K 
April        +$15K   +$11K   +$17K   -$10K 
May           -$4K   +$15K    +$8K   +$30K
June         +$29K    +$9K   +$15K   +$15K
July         -$24K    -$9K    -$5K   -$20K
August       +$17K    -0-    +$14K   -$25K
September     -$3K    +$5K    -$9K   +$10K
October      +$10K    +$5K    +$9K    -$1.5K
November       -0-    -0-     +$1K     +1K
December       -0-   +$10K   -$15K   -$24.5K
Total        +$43K   +$90K   +$90K    +$5K
 
Comparing YTD numbers for the last four years, we find
 
YTD thru   2003    2004    2005    2006    2007 
January    -$4K   -$47K     -0-    +$5K    -$3K 
Let's peek at YTD volume over the last few years. 
 
Resales Sold  2003    2004    2005   2006   2007 
January      1,682   1,682   1,253    931    983 
The monthly realtors' blurb focuses on current 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"  and "year-over-three-years-ago" or "y-o-3y": 
 
Resale Units 2003   2004   2005   2006  2007  y-o-y y-o-2y y-o-3y 
January     1,682  1,682  1,253    931   983  +5.6% -21.5% -41.6% 
 
 
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.  Fortunately, we have this data also:
 
Single-family homes listed for sale 2006:
 
                           DQ        MLS
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  4,201
October 5   3,389  3,899  (DQ= +100.9% YTD)
November 7  3,070  3,496  (DQ=  +82.0% YTD)
December 6  2,571  2,843  (DQ=  +52.4% YTD)
January     1,969  2,554  (DQ=  +16.7% y-o-y) 
February 8  2,238  2,901  (DQ=  +23.1% y-o-y)
 
MLS data is pulled within a day or two of this missive's creation (meaning the "as of" date lags ~two weeks).
 
Breaking down the details: 
                                Peak    Since 
All Homes     Current Peak    Date     Peak   y-o-y 
Santa Clara Co. $660K  $690K  Jul26'06  -4.3%   +0.8%# 
San Mateo Co.   $735K  $775K  Jul20'05  -5.2%   -1.3%##
Santa Cruz Co. *$665K  $720K  May26'05  -7.6%   -2.9%### 
 
*= thru ~January 23 
mis-reported publicly as: # = +1.5%; ## = +1.4%; ### = +5.0%
 
Price changes between January 23 and January 31 might account for some of the y-o-y percentage change discrepancies...
 
                                Peak    Since 
Resale Homes   Current Peak   Date     Peak    y-o-y 
Santa Clara Co. *$707K  $772K  Jul20'06  -8.4%   +1.0%
San Mateo Co.  **$780K  $830K  Aug11'05  -6.0%   -1.0%
Santa Cruz Co  **$718K  $775K  Nov04'05  -7.4%   -0.3% 
 
*=- thru January 26
**= thru January 23 
 
 
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:
       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%
Oct.     2.0%      -1.8%      0.0%
Nov.     2.0%      -1.3%     -8.5%
Dec.     0.9%      -1.2%     -2.9% 
Jan'07   0.8%      -1.3%     -2.9% 
 
"Resale Homes" y-o-y:
      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%
Oct.     2.7%       0.0%     -4.2%
Nov.     2.1%       1.3%     -3.3%
Dec.     1.4%      -1.2%     -3.6% 
Jan'07   1.0%      -1.0%     -0.3%  
 
Bottom Line:   
Inventory is starting to turn upwards.  There might be some minor price increases and sales volume might even tick up but, compared to 2004 and 2005 activity, we're still betting 2007 will be a "Silent Spring."  
 
The true facts will emerge over the next couple months.
 
This web site exists because of the truth behind the old adage about how one can deceive people with, "Lies, damn lies and statistics."
 
Except for the above, until further notice, the above will be offered without commentary, editorial, ranting, raving nor even smarmy sarcasm.  (Of course, we also reserve the right to change our mind.)
 
 * * * * *
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.