Axis | A Year In Review
Axis has seen an average of 20 units sold each year over the past 5 years. 2018 at Axis resulted in just 13 sales and 2019 saw the second lowest number of sales in the past 5 years. The figures are: 16 properties including 3 off market sales (leaving just 13 to choose from on the open market). The major differences between the past two years include average days on market, average $/SqFt, and sales to list price ratio.
Days on market increased in the building by 2.5X from 10 in 2018 to 25 in 2019, while average $/SqFt dropped from ~$907 to ~$866 (4.5%) over the same time span. The ‘days on market’ numbers are still considerably low compared to nearly every other market in the country. However, in Silicon Valley real estate over the past 5 years or so, anything close to a month on the market feels like an eternity. A drop in average $/SqFt is expected to follow as homes sat on the market longer giving buyers the ability to negotiate with sellers, a nearly unheard of opportunity in San Jose for several years. While sellers were slow to give in, those who had to make a move were forced to obey the market and sell for what they could, with each of them likely still walking away with solid equity despite the year-over-year loss.
Sales-to-list price ratio is always an interesting data point to look at as well. In 2018 the sales-to list-price ratio hovered around 103% and in 2019 it dropped to 98%. These numbers are not surprising, considering the building has gone through nearly 2 years of litigation plus the region as a whole experienced a dip as well. Axis has held up fairly well during the market pullback, solidifying it as one of the most coveted buildings in San Jose.
The most notable sale in the building in 2019 was a penthouse on the 22nd floor which came on the market the week after 4th of July and took until two days before Christmas to finally sell. That unit sold for $1.75M ($1386/SqFt) proving that value is still holding strong even in the higher end units.
As we kick off 2020, low interest rates and inventory have built buyer interest back up and caused the market to slingshot back to life. Anyone with eyes on the building and the market should be excited to get in considering more than doubling in appreciation in the building since 2010 when the average $/SqFt was less than $400. Sellers who were concerned that their peak value had passed, now have clear signs that they can get back to that level and even higher prices could be on the horizon. There’s been 10 units in the building that have sold, are pending or are currently active to start the year. With more activity in the building to jump start the year, 2020 will certainly tell its own story as the downtrend seems to have vanished.