Homes in Pleasanton are selling for significantly more than their list price and in record time.
Is this sustainable? One local real estate expert says yes.
"Every time I think there's going to be a little bit of a break, you hear more stories of crazy multiple offers," said Pleasanton Realtor Jennifer Branchini, the 2021 treasurer for the California Association of Realtors. "Unless we get a ton of inventory, the fierce competition is going to persist for a while longer."
The median sales price for a single-family detached home in Pleasanton has exceeded $1 million each month since 2016. During March 2021, the median price was $1.53 million.
Homes sold, on average, for more than 10% of their asking price. And during the first quarter of 2021, a home was on the market in Pleasanton for an average of 13 days, compared to 27 days during the first quarter of 2020.
Home sales in Pleasanton increased 60% compared with last March 2020. Part of that increase is due to real estate activities being suspended in the weeks after the countywide shelter-in-place order issued on March 15, 2020.
Part of the rebound in sales is a result of real estate professionals and their clients being able to navigate the COVID-19 health restrictions on some activities, including home showings, and the strong demand for homeownership in Pleasanton.
The current market conditions are also a side effect of more than a year of pandemic shelter-in-place restrictions and the flexibility for some Pleasanton residents to work from home.
Pleasanton is located in a sweet spot that is close enough to Silicon Valley employers so that a commute into the office is still tolerable when employers require workers to return. Additionally, single-family detached homes with multiple bedrooms and backyards are commonplace in Pleasanton and desirable for those able to work from home.
However, reports of Californians fleeing the state do include some Pleasanton residents. "Some people are moving out of state, and some are moving within California," Branchini said. She explained that one of her clients is "downsizing" by moving full-time to their second home in the Sierra foothills.
Yet the promise of a lower cost of living in another state or the charm of an alpine location has not been enough to inspire flocks of current homeowners to leave Pleasanton.
"If you own a home in Pleasanton, you're super-grateful and a lot of folks are doing significant remodeling and adding on because they love the community and don't see the need to move away," Branchini said. "I've even seen a ton of clients redo their garages, put in a nice floor and new cabinetry so they can have a nice space to use."
The fact that most Pleasanton residents are staying here, along with limited new residential construction, is resulting in fewer homes for sale and higher sales prices for the foreseeable future.
Another factor is historically low mortgage interest rates, which help make monthly payments, even for a million-dollar home, relatively affordable for some buyers.
Asked how buyers can purchase in Pleasanton given the stratospheric sales prices, Branchini cited the significant assets many have available for a large down payment.
"Personally, I'm not seeing a lot of cash buyers, but many are well-qualified and have up to 20% down payment," she said. "The interesting thing is there are a lot of first-time buyers that are coming in that have been on the sidelines for a long time."
Branchini emphasized that a healthy bank balance is only part of being prepared for home ownership in Pleasanton. She said, "Buyers need to read their documents and understand what they are signing, as well as understand the inspection reports so that they go in with open eyes."
Buyers need to have "a lot of patience and don't give up because buying a home is a process that may not happen with the first house they make an offer on or even the fourth house, but they will eventually succeed. It will go in their direction."
Editor's note: David Stark is the public affairs director for the Bay East Association of Realtors, based in Pleasanton.