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Los Altos house prices have wobbled around a fairly steady increase rate for 12 years. The rate has declined slightly in the last few years but is quite close to the Santa Clara County house price trend.
The Los Altos Hills house price trend shows a greater slowing in the last few years.
Ken Rosen, the chairman of the Fisher Center For Real Estate, at Berkeley’s Hass School of Business, talked recently about future real estate trends. Two points stood out: 1.) The old paradigm of low interest rates is not going to return in the foreseeable future. 2.) The doubling of debt service costs and cap rates has decreased values and now may be the best opportunity to buy real estate below replacement costs we’ve had since the early 1990’s.
Los Altos House Prices
Los Altos real estate trends show relatively flat house prices after the price drop at the beginning of 2022. The drop in values Dr. Rosen talked about doesn’t apply to Los Altos houses. However, he also brought up replacement costs. The increased financing cost and increased cost of materials has brought the construction of new market rate apartments to a halt in San Jose. Replacement costs have discouraged builders from starting new housing projects. With neither interest rates nor building costs likely to decrease, waiting for change before trying to achieve your housing goals is not likely to be a good plan.
Real estate economist Ken Rosen on YouTube.
The Los Altos Hills average size of houses sold reached an all-time quarterly high on Aug 18, 2023.
However, the average size of Los Altos homes sold was at the lower side of recent trends.
What makes this catch our attention is that the average house size for eight San Mateo County cities (Foster City, Menlo Park, Millbrae, Pacifica, Portola Valley, San Carlos, San Mateo, and Woodside) and for Palo Alto spiked upward to their highest-ever quarterly values. The trend was so broad that the San Mateo County average size of houses sold also reached an all-time high.
Although no reason is known for the spike in the average size of houses sold in San Mateo County, it appears that Los Altos and Los Altos Hills are probably not similarly affected. Learn more about Los Altos real estate.
There have been a few reports (without data) that the corona virus pandemic is leading home buyers to prefer larger homes with larger lots. In Silicon Valley the city of Los Altos is known for having lots larger than most other Silicon Valley cities.
Comparing house sales price trends for Los Altos to downtown Palo Alto does not yet show any change in preferences. Prices have been relatively flat since the beginning of 2019 for both areas through the end of November 2020.
