Silicon Valley real estate prices leap: new bidding wars | The Mercury News

Six months ago, there was widespread talk about the flattening of the Bay Area housing market — its red-hot temperature had calmed to a simmer.

That conversation appears to be ancient history.

To wit, this example: Alain Pinel agent Mark Wong sent out an email blast Tuesday revealing that around 60 South Bay homes, mostly in Sunnyvale and Cupertino, sold for $200,000 or more over the asking price in the last 30 days. And he wasn’t necessarily talking about fancy schmancy places. One modest Cupertino house — 1,046 square feet — sold for $660,000 above its listing price.

A townhouse at 982 La Mesa Terrace, also in Sunnyvale, listed at $1,099,000 and sold for $1,400,000 — $301,000 over asking. For a townhouse.

“The listing price doesn’t mean anything anymore,” Wong said. “It’s just a number.”
“Most of the agents, they love to list under the fair market value, so that’s why it creates an auction-style sale,” he said. “The buyers are smart people. They look around. And when they see a property below the fair market value, they think they’ve found a good deal and they’ll jump on it. Then everybody jumps and it bids up the price.”

Read complete article here:

Silicon Valley real estate prices leap: new bidding wars.