Pleasanton October Market Update - Inventory Continues to Shrink

The Market saw the inventory shrink yet again, with 133 single family homes on the market at the end of October, continuing a trend that began in May, when there were 243 homes on the market. October’s inventory is the lowest level in Pleasanton since February 2006 and is a sharp decline from October 2008, when there were 249 homes and October 2007 when there were 204 homes on the market. As I mentioned last month, inventory levels below 150 are very low for Pleasanton.

Sales remained strong, with 58 pending sales in October, up from 55 in September, but remained below this year’s high of 76 set in July. With the inventory at such low levels, it can be difficult to sustain high levels of sales. Here is a graph of the inventory and pending sales activity for the past 15 months.

All Pleasanton Single Family Homes
Inventory Vs Pending Sales Oct 2009

The biggest decline came in the under $1 million segment, where the inventory of available single family homes declined to a total of 61 single family homes on the market at the end of the month, compared to 74 for September. Inventory in this segment was 137 a year ago. Pending sales, while relatively strong, fell to 44 homes, from 46 in September. This is approximately a 1 1/2 month supply of homes, which indicates that market conditions are strong in this price segment. As a comparison, there were only 24 pending sales of single family homes in October 2008. Below is a graph of the activity in this market segment.

Pleasanton Single Family Homes Under $1 Million
Inventory Vs Pending Sales Oct 2009

Pending sales increased in the $1 million to $2 million market segment in October for the first time since July. There were 12 units pending sale for the month, compared to 8 in September and 5 in October 2008. Inventory, on the other hand, declined for the fourth straight month to 45 units, compared to 52 units in September and 81 in October 2008.

Pleasanton $1 Million - $2 Million
Inventory Vs Pending Sales Oct 2009

In the luxury home segment over $2 million, inventory increased for the first time since June of this year. There were 27 homes on the market in this segment, compared to 26 in September and 31 in October 2008. Pending sales increased from 1 unit in September to 2 in October. As a comparison, there were 2 pending sales in October 2008. This is still a 13 month supply of homes on the market, which indicates some weakness in this segment.

Pleasanton Over $2 Million

Inventory Vs Pending Sales Oct 2009

Overall for Pleasanton, homes under $1 million constituted 76 percent of pending sales in October but only 46% of available inventory. Sales have remained relatively strong across market segments while inventories continue to decline for homes priced less than $2 million. It is unlikely that the trend of low inventory will change much until we head towards the Spring. The continuation and expansion of the first time buyer tax credit and low interest rates should keep sales activity strong as we head into the New Year.