Dec
17
2008
The San Mateo real estate market was a mixed-bag in November 2008. The volume of home sales plummeted to the lowest value in years. Seeing a drop in volume this time of year is not abnormal, but the severity of the drop is. However, note that similar results were seen in neighboring communities. If there’s any good news, prices seem to be stabilizing — we’re not seeing double-digit drops in the average and median prices. Hopefully, this means the bottom is starting to approach. See the data below.
Summary
| Trends |
Nov 2008 |
Previous Month |
Year-over-Year |
| Median Price |
$868,500 |
$786,000 (+10.5%) |
$877,000 (-1.0%) |
| Average Price |
$1,025,600 |
$873,118 (+17.5%) |
$1,032,160 (-0.6%) |
| No. of Sales |
29 |
44 (-34.1%) |
44 (-34.1%) |
| Pending Properties |
27 |
46 (-41.3%) |
39 (-30.8%) |
| Active |
147 |
141 (+4.3%) |
136 (+8.1%) |
| Sale vs. List Price |
96.2% |
98.5% (-2.3%) |
98.8% (-2.7%) |
| Days on Market |
51 |
66 (-22.6%) |
34 (+51.1%) |
Here’s a graphical representation of the monthly unit volume, average sales price, and median sales price. Note that this is a 3-month rolling average, which is used to normalize spikes and drops in the data.
Price and Volume Trends
Finally, here’s a snapshot of the year-to-date sales volume. Simply put, the figures speak for themselves.
YTD Sales
Oct
22
2008
In San Mateo County, it is “customary” for the buyers in a real estate transaction to pay for closing costs. (Note the word customary – like anything else in a transaction, this is indeed negotiable.) But with a normal transaction, the majority of the fees that you’ll see when you close escrow are:
- Escrow fees
- Title insurance, and
- Loan origination fees.
Assuming that you’re not pre-paying points on your loan, you can count on closing costs to amount to about 0.8% of the purchase price. So if you’re buying a $1M home, you should have an additional ~$8,000 set aside to close escrow. Again, this is a rough approximation, but it gives you an idea on the costs involved — first-time buyers are sometimes caught be surprised by this and have to scramble to close escrow.
Well, if you’re buying a home in the City of San Mateo, you need to be aware of an additional transfer tax that increases the 0.8% significantly. The City of San Mateo levies a “City Transfer Tax” of $5.00 per every $1,000 of the sales price. So the same $1M home would be levied an additional $5,000 of taxes at closing. The good news? Unless it’s agreed to otherwise, the buyer and the seller split the City Transfer Tax 50/50. Regardless, $2,500 represents an increase of about 31% above our example $8,000 closing cost.
So while you’re scraping up enough change to buy that first home, be sure to keep an extra stash on the side to cover your closing costs.
