"In late 2022, the market transitioned as interest rates increased and the IPO boom receded," said Dana Carmel, founder of the Dana Carmel Group and Represent Realty. "This has caused home prices to adjust to changing economic factors, leveling out the playing field between buyers and sellers."
Navigating a balanced real estate market
Menlo Park, Atherton and Portola Valley are known for being upscale, affluent communities. Many residents are high-income earners, including executives, tech industry leaders and entrepreneurs. This has led to house prices rising far above the national average over the years.
"In the luxury market, we aren't seeing as many of the IPOs or tech company sales that fueled home sales by creating instant millionaires," Carmel said. "Luxury homes are lingering on the market and slower to sell. Luxury buyers prefer newer smart homes with amenities like a pool, gym and private office."
The slower market doesn't mean sellers have lost all their power, though. Their control over half of the supply and demand equation continues to give them leverage.
"On the flip side, inventory is at one of the lowest points we have seen as sellers hold onto their locked-in, low-interest rates," Carmel said. "Sellers are also choosing to rent out their home rather than sell."
With an experienced real estate agent team that can use effective marketing and pricing strategies, sellers can still expect to sell their Bay Area homes for competitive prices while pre-approved or cash-on-hand buyers can benefit from a low-stress process that lacks the frenzied feel of the past few years.
Looking ahead
To predict how the housing market will fare in Peninsula communities in the future, Carmel looks to the past.
"History shows that homes located in the Peninsula region tend to hold their value well over the long term," Carmel said. "So, while we are seeing a temporary dip in prices in some areas right now, home values will likely begin to climb again in the near future."
With a limited supply of homes on the market, Carmel recommends buyers keep an open mind when perusing their options.
"In a competitive market with constrained inventory, it's rare to get everything you want in a house," Carmel said.
Sellers, on the other hand, will need to place an emphasis on preparation.
"Gone are the days of putting your home on the market as-is and expecting multiple offers the same week," Carmel said. "Investing in your home with fresh landscaping, paint and decluttering makes a big impact on the value."
She also recommends showcasing a home's potential.
"Properly staged homes tend to sell faster and at higher prices," Carmel said. "If professional staging isn't feasible, you can still arrange furniture and decor to enhance the space's appeal. Staging also stands out in professional photography and video, which is a must as more and more buyers search the internet for their next home."
Dana Carmel Group is Silicon Valley's go-to real estate agency. Carmel, who is ranked in the top 1.5% of Realtors in the nation, and her team have in-depth knowledge of the local market, high-level negotiating skills and marketing expertise to give their clients, both buyers and sellers, a competitive edge.
