Palo Alto Real Estate Market Prices, Trends and Forecast

 

Located around 30 miles south of San Francisco, Palo Alto serves as the center of Silicon Valley Neighborhood. Home to tech giants, numerous startups, and prominent venture capitalists, the city holds a unique position in real estate. Undoubtedly, the Palo Alto real estate market has consistently reflected the prosperity and innovations of its many residents. From incredible architecture to hefty home appreciation, owning property in this South Bay city offers many benefits. However, before jumping into the market, it’s best to learn everything you can about it first.

While the price of homes in Palo Alto has dipped around 12.8 percent over the last year, most experts predict home values will likely increase by the end of the year. Recently, the demand for housing in the area has increased, resulting in many homes selling over the list price. Experts see this trend as a good indication that home prices will likely rise in the near future.

According to many experts, mortgage interest rates are likely to decrease throughout the rest of 2023. July of this year saw mortgage rates end precisely where they began at the beginning of the month. That said, the average 30-year fixed-rate mortgage slightly rose two basis points for the week ending on August 10 from the week prior. Still, while housing market watchers expect these rates to remain elevated due to ongoing economic uncertainty, these experts believe rates peaked last fall and will likely decline later this year.

Despite Palo Alto being one of the most coveted places to live in California, the price of houses and the high cost of living in the area have driven many people away. The local population is currently declining at a negative rate of 2.64 percent annually, and its overall population has declined by 7.7 percent since the most recent census in 2020. However, even with a shrinking population, the area's housing demand is still strong, which will likely help increase home prices even further moving forward.

 

 

The housing market in Santa Clara County, which includes the city of Palo Alto, typically sees a cooling-off period during mid-summer each year. While this trend is happening in the county, a few elements are stronger than in prior years. The county is facing two specific trends that will likely help buyers moving forward. Those trends include slightly softer home prices and a slight increase in inventory. These trends are expected to continue in the near future; however, they likely won’t last for long, which means now is an excellent time to enter the market.

 

As it did with the global real estate market, the COVID-19 pandemic profoundly affected the Palo Alto housing market. Given the city’s location in Silicon Valley, it encountered a set of unique circumstances during the pandemic. For instance, with the rise of remote work, those in the tech sector began to reconsider the need to live near their offices. Because of this, many residents began to explore less dense, suburban areas. Additionally, although sales dipped at the beginning of the pandemic, the local market quickly rebounded, resulting in home values in the area remaining relatively resilient. Still, the long-term impact of the pandemic on Palo Alto real estate remains to be fully understood.

When compared to other states, California, in general, ranks in the 14th spot for the highest foreclosures in the country. Out of the state’s more than 14.4 million housing units, around 3,598 houses entered the foreclosure process. This gives the state a foreclosure rate of one in every 3,982 households. Counties in California with the highest foreclosure rates include Yuba, Sierra, San Joaquin, Glenn, and Calaveras.

In July 2023, homes in Palo Alto were selling for around the $3.2 million mark. Although that number has dipped recently, prices remain well above $3 million. In fact, as mentioned above, homes, on average, sell above the listing price, indicating prices will likely increase shortly. If you’re looking to buy a property in the area, now is the time to do it before prices rise.

 

Palo Alto has long been considered one of California's best places to live. Given the city’s proximity to Silicon Valley and the San Francisco metropolitan area, it is in a prime position for young professionals and families looking to set down roots. With home prices in the area slightly lower than in previous months, now is an excellent time to invest in property in the area. Still, before deciding whether to enter the local market, you should consider your budget and housing needs.

 

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Palo Alto real estate is highly coveted and in high demand. Because of this, you need a skilled real estate agent on your side. Stephanie Von Thaden is a Palo Alto real estate agent with years of experience in the industry. Utilizing her knowledge of the local market, Stephanie constantly stays up to date on current trends and future forecasts. Because of this, Stephanie knows what it takes to secure great deals on homes in the area. If you want to enter the Palo Alto real estate market, contact Stephanie Von Thaden today.

 

 

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