Los Altos is a gorgeous city nestled in the heart of Silicon Valley. Residents love the lush environment and luxurious atmosphere across its seven square miles. Currently, Los Altos and Santa Clara County are experiencing cooling market trends as interest rates rise and inventory replenishes itself. Here’s everything to know about the Los Altos real estate market when buying, selling, or investing in the area.
About Los Altos
Located 40 miles outside of San Francisco, Los Altos is a beautiful residential community that offers a quiet lifestyle for its residents. Families love this city for its highly-rated schools like Los Altos High School, one of the top-ranked institutions in California. Professionals are attracted to the major tech companies in the area, while retirees enjoy luxury properties surrounded by outdoor recreation, high-end shopping, and fine dining.
Residents can spend a day outdoors at the Windy Hill Open Space Preserve, a 1,414-acre area with hiking, biking, and horseback riding trails spread across its grasslands and forests. Locals are brought together by weekly events like the Los Altos Farmers Market, which provides seasonal fruits and vegetables, live music, prepared food, and wine by the glass. Residents can also shop at one of the city’s many shopping districts.
Los Altos housing market forecast 2023
It is likely that the Los Altos real estate market will continue cooling throughout the rest of the year. Although low inventory inflates home values, increasing mortgage rates will continue to affect buyer demand.
A closer look at the home values
According to the most recent monthly market report by the California Association of Realtors, the median price for single-family homes in Los Altos, CA, is currently
$2.55 million. This represents an 11.8% decrease since sales prices seen last year.
It’s important to note, however, that Los Altos homes sell for higher prices than in the rest of the county. According to the most recent Santa Clara County market update, the median price for single-family detached properties was
$1.5 million. The median price of Los Altos homes is also much higher than California’s
median home value of $735,000 and the national median home value of
$363,000.
Inventory and sales statistics
Currently, sales for single-family Los Altos homes are down by
50%. This mirrors the hesitation of many buyers to enter the market and purchase properties. In addition, the number of active listings has risen by 100%, up to
44 active listings. Los Altos homes are spending a median of 23 days on the market, with 18.2% of them experiencing reduced prices. That said, the sales-to-list-price percentage still sits high at
98.9%.
Rising mortgage rates
As of the latest data from the NAR, the average monthly
mortgage payment for homeowners in Santa Clara County is $7,558. This is almost $3,000 more than last year’s average monthly mortgage payment of $4,740. Buyers should keep these figures in mind when planning out their home purchase and their finances. Across the state, the average
interest rate for a 30-year fixed loan is 6.74% while 15-year fixed loans average 5.98%.
Santa Clara County market trends
Overall,
Santa Clara County echoes many of the same trends visible in the Los Altos real estate market. Single-family detached home sales have decreased by 37.9% compared to last year, which reflects less buyer demand in the area. Buyer demand is limited by both higher mortgage rates and insufficient inventory. Although months’ supply of inventory has increased by 45% since last year, it’s still low, sitting at 2.9 months.
The median price for single family homes across the county is $1.5 million, which is a 17.6% decrease year-to-year and a 2% drop month-to-month. Also, 19.2% of listings have
reduced prices, although many homes still sell at their original list price. Continued buyer interest is also visible in listings’ median time on the market, which is a quick nine days.
How COVID-19 affected the Los Altos real estate market
In the height of COVID-19, the Los Altos real estate market experienced hot
sellers’ market conditions. Heightened buyer interest obscured traditional seasonal market trends, resulting in an active market limited by the quickly dwindling supply. Even with pandemic restrictions complicating home showings and open houses, buyers were willing to partake in online showings to close on a deal. Los Altos is still recovering its inventory from pandemic highs but has since cooled off. That said, the area consistently holds plenty of appeal.
Why to invest in Los Altos real estate
Los Altos is a great investment for all types of buyers. Appreciating prices and continued buyer demand in this affluent area makes it a wise long-term investment. Nearby schools, extensive outdoor recreation, and a strong business sector adds to Los Altos’ home values and overall allure.
Tips for buying and selling
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Partner with an agent: Buyers and sellers who partner with an agent can count on a professional understanding of local market trends that is used to find home listings, competitively price a home, and time a home transaction.
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Start with a goal: A home transaction of any kind is a big responsibility, which is why buyers and sellers should have clear goals for their real estate journey. Buyers may need to upsize or downsize, while sellers may be moving for work.
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Plan a move early: When it comes time to move into or out of a home, the worst-case scenario is scrambling to pack up belongings in a single day. Start packing two or three months before a home sale or purchase to avoid mistakes.
Ready to invest in Los Altos?
Los Altos’ cooling market presents a mix of challenges and advantages for buyers, sellers, and investors alike. Even so, its unbeatable location and beautiful atmosphere make it appealing across the board. When you’re ready to get started in
Los Altos real estate, partner with expert local broker
Sophie Tsang to guide you through the process.
*Header photo courtesy of Shutterstock