Realty Times reports on the Silicon Valley housing bubble. "Silicon Valley's housing market is rearing its volatile head again. Consumers are bailing out in numbers reminiscent of the area's last major housing market downturn, but is it a buyer's market?"

"Buyers are negotiating down list prices, but rising interest rates and median home prices stuck at record levels are preventing more buyers from cashing in. Rather than a buyers' market, it's more like a 'buyers aren't buying' market."

"'Basically, the buyers have gone away, causing the number of transactions to be at or near record low levels. This is across all four counties that I track. This indicates that it is a fairly broad change and not localized,' said Richard Calhoun, broker owner in San Jose."

"Calhoun's statistical report compiled with data from the area's official MLS, reveals in Santa Clara County (Silicon Valley) there were only 661 closed sales on single-family homes in January 2006, down from 970 in December and down further from 839 in January 2005. Since 1998, only January 2001 had fewer closed sales, 599. The next lowest was January 2000 with only 719 transactions, he said. There were only 283 closed condo sales in January 2006, down from 352 a year earlier, Calhoun reported."

"'Offers accepted, or initiated sales (for single-family homes) were way down also, at only 811 (for January 2006). Only January 2001 had fewer, at 761. So 811 is significant and it means February closings will be way down,' said Calhoun. As sales fell, inventories swelled to 2,229 for single-family homes, up from 1,547 a year ago. The number of condos for sale has nearly doubled in the last year moving from 440 in January 2005 to 825 in January this year."

"'Buyers are a lot smarter then they have been in past years. They are doing their research and waiting for the ideal time to get into this market. This is really going to turn into a buyers' market. We will see homes on the market for much longer than we have seen in the past and we will also see buyers really taking their time to shop for that perfect home,' said Shawneequa Badger, a real estate agent in San Jose."

"But a bona fide buyers' market needs, well, buyers. The big sticking point in putting the 'buy' in a buyers' market is the cost of housing. That's because falling prices, often a key component in a strong buyers' market, haven't appeared. The median price in January was $740,000, up from $664,000 a year ago, and not much off the peak median price for single family homes reached twice last year, $760,000. Buyers don't appear to be buying it."