Condos and Townhomes are rapidly becoming one of the most affordable housing options. They are especially attractive alternatives when trying to live close to work and town centers with restaurants and shops.
The chart below shows the number of 2-bedroom Condos and Townhomes sold in 2016 by city and price range. Santa Clara dominates the $500k to $750k price bracket, while Sunnyvale and Mountain View are the primary markets for the $750k to $1.0M price range.
Using Sunnyvale as an example, the next chart shows the distribution of prices by the number of bedrooms. 2-bedroom Condos are the most prevalent, while Townhomes dominate the 3-bedroom category. Age of the Condo/Townhome is also a big factor as the newer ones command a higher price. Interactive charts for Mountain View and Sunnyvale are available at www.SiliconValleyMLS.com/mountain-view-condos and www.SiliconValleyMLS.com/sunnyvale-condos
Market values for Condos and Townhomes continues to rise. Values rose more slowly in 2016 than the previous four years: Sunnyvale 5.8% and Mountain View 16%. I expect values to continue rising by 7%-12% over the next few years. Continued hiring is the primary driver. There is significant new construction underway, which will help to balance supply with demand.
Recently closed sales are showing final sales prices vs. list price to be similar to last year. The monthly average is typically lower later in the year as new listings incorporate final sales prices from earlier in the year. The initial indication is that final sales prices are rising at a similar rate as last year.
Given our continued market conditions, my initial assumption is that buyers will need to offer ~10% over list to make the short-list. The actual offer price can be refined the day before offers are due and we have a better idea of the number of competitive offers.
For buyers starting out, I like to provide an overview of where potential Condo/THs within their price range are located in Silicon Valley. Below is a map showing the location of the 92 closed sales for Condo/THs with a final sales price between $600k and $800k. Note how the number of sales increases as you look further south.
Send me an email if you would like a market overview personalized for you. I should be able to get it back to you no later than the next day.
Please feel free to ask me any questions or request additional market data. I’m always available to help you and your friends.