What do Silicon Valley Short Sales Indicate about the Health of the Real Estate Market?

Statistics are all about tracking what is measurable, from "days on market" and "aborption rates" to "price per square foot" and "list price to sales price ratio". Today's San Jose Mercury News featured a headline story about the ten San Jose zip codes with large numbers of homes in foreclosure that are on the market (up to 2.6% of the listed homes in one area). That dire piece was accompanied by another on the two day crash on Wall Street and was topped off by a small article regarding the California state budget crisis.

It was a distressing front page.

But the short sale situation in Silicon Valley is not so terrible everywhere. For several years, we have had a bifurcated market - a split market in which part of the valley seems to have been doing relatively OK while the other part, the poorer part, was getting sucked down into the murky mortgage meltdown. Most every part of Santa Clara County, and its largest city, San Jose, is now impacted by the lending crisis. But some parts are impacted much more than others.

Most parts of the west valley are not faring nearly so badly. To see a chart tracking selected areas of Silicon Valley in March, May, July and September, please visit my Live in Los Gatos blog and view the post, Silicon Valley Shortsale Snapshot.