The DeLeon Insight - March 2026 by DeLeon Realty

Market Conditions By City

$10,000,000

$9,000,000

$8,000,000

$7,000,000

$6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

Average sale price for single-family homes from 12/2024 to 2/2025, compared to the period from 12/2025 to 2/2026.

Average Sale Price

12/2024 - 2/2025 12/2025 - 2/2026

Price/Square Foot Ratio

Price per square foot ratio for single-family homes from 12/2024 to 2/2025, compared to the period from 12/2025 to 2/2026.

12/2024 - 2/2025 12/2025 - 2/2026

Source: MLSListings, Inc., as of March 2, 2026 Criteria: Single Family Residential

Atherton Los Altos Los Altos Hills Menlo Park Mountain View Palo Alto Portola Valley Redwood City San Carlos Sunnyvale Woodside

Judge Makes Ruling on Zillow / Compass Injunction

By Francis Lopez

In late 2024, Compass gained publicity with their three-phase marketing plan for sellers. Under the plan, sellers are first encouraged to place their listings on Compass’ exclusive platform, before entering a “coming soon” phase, and ultimately going live on the market. In April 2025, Zillow and Redfin responded by announcing they would ban any listings from their websites that are not on the MLS within 24 hours of being publicly marketed. Ultimately, Compass filed an anti-trust lawsuit against Zillow in June of 2025.

Compass has made it clear that it’s three-phase plan is intended to “test the waters” for sellers. Unfortunately, the marketing plan prevents nonCompass buyers from seeing the property, limiting the buyer pool for sellers. For buyers, this can also be extremely frustrating as they may not realize a property is for sale until after it has been sold off market. Ultimately, this strategy eliminates opportunities on both sides of the transaction.

It may appear surprising that Compass is fighting so aggressively to support a policy that clearly works against their home sellers. Intuitively, it makes complete sense that homes that are off-market and therefore are not exposed to all buyers sell for less money. How much of a discount off-market homes sell for may vary across geographic regions. Zillow found that California off-market homes sold at a market discount of 3.7%.1 Zillow also found that off-market sales underperformed and sold for less money at all price points, including the luxury market. The Bright MLS analyzed more than one million transactions across five states and found that homes listed and marketed on the MLS sold for 17.5% more than comparable properties sold off-market, even

after controlling for property and neighborhood characteristics.2 So Zillow’s fight for transparency is also a fight for home sellers to achieve the highest possible price and for buyers to have equal access to the American Dream of homeownership.

Compass’ lawsuit claims Zillow maintains an illegal monopoly on online home listings, and has an anticompetitive agreement with Redfin. After filing suit, they followed up with request for a preliminary injunction to halt the Zillow ban policy. On Friday, February 6th, a judge denied Compass’ request for an injunction. In doing so, the Judge issued a 50-page decision finding no clear showing of a monopoly, and that Zillow and Redfin likely acted independently. So, while the lawsuit continues on, the Zillow ban policy can remain.

And while the various companies posture against each other, it should not be lost that the goal in real estate is a successful transaction between a buyer and a seller. Along with widely marketing a property through social media, newspaper ads, commercials and various other marketing, aggregate websites like Zillow and Redfin are a tool for both property buyers and sellers to find the right match in a transaction. At DeLeon Realty, we don’t believe in hiding your listing, rather, we want to maximize exposure to the greatest extent possible in order to ensure higher sales prices for our sellers. Using all of the possible channels to present a listed property is how real estate should operate, not in favor of any particular agent, but in favor of the clients.

1 https://www.zillow.com/research/mls-pln-sale-price-34846/

2. https://irp.cdn-website.com/3d0f9886/files/uploaded/On-MLSStudy-2023-1.pdf

Why Your Neighbor’s Home Sold for More Than Expected

By Audrey Sun

Many homeowners assume a record sale was luck. In Silicon Valley, it rarely is; rather, it’s preparation, strategy, and careful execution. And when done correctly, it can mean hundreds of thousands of dollars in difference.

It Wasn’t Luck, It Was Preparation

At DeLeon Realty, preparation is the backbone of our brokerage. We have in-house designers and trusted handymen who not only design your home preparation to ensure alignment with the desired buyer-pool, but also act as financial gatekeepers to align costs with anticipated returns. Traditional agents are not designers or cost analysts. They often cannot tell you what truly moves value or what improvements should realistically cost.

Our designers identify the highest-impact updates with the lowest investment. Strategic paint, flooring refinishing, lighting, landscaping, and subtle design adjustments often yield three times the return or more. We obtain multiple estimates, negotiate pricing, and work with long-term vendors who prioritize our projects and stay on schedule.

Working with our design team also means that your staging is never generic. We match the right stager to the architecture and target buyer. A classic Spanish style home in Old Palo Alto requires a different approach than a mid-century or transitional property. Today’s buyers are highly visual. They decide emotionally first and justify logically later. Presentation drives perceived value.

When a home feels polished and move-in ready, buyers compete. And ultimately, the competition drives price beyond market value.

Marketing That Reaches Every Qualified Buyer

Silicon Valley buyers are both local and global. As a result, we advertise extensively in the Palo Alto Weekly, The Almanac, Los Altos Town Crier, Mountain View Voice, and the San Francisco Examiner. We also invest heavily across television and digital platforms to ensure maximum attention.

The Chinese buyer community remains a powerful segment of our market. Many are locally based

technology professionals who prefer to engage in their native language. Our multilingual marketing across Chinese television, newspapers, and social platforms ensures that no serious buyer is overlooked.

Pricing Psychology

In a seller’s market, pricing is not only about signaling value, it’s about attracting attention as well.

We often position homes strategically below perceived market value to create urgency. But pricing low alone is insufficient. It must be paired with aggressive marketing, direct mail, media exposure, and concentrated open house traffic.

When hundreds of buyers walk through in the first week, multiple offers follow. Bidding wars push the price well beyond expectations.

Full Exposure Beats Off-Market

Pocket listings often benefit the agent more than the seller. Limited exposure restricts competition, instead facilitating double-ending and maximizing commission within the same brokerage. Our philosophy is simple: bring the entire qualified buyer pool to the table at the same time in order to create momentum and let the market compete.

The DeLeon Team has the strategy, experience, and resources necessary to maximize the sales price of your home. If your are curious what your home could truly command in today’s market, please reach out to us for an evaluation.

Real Estate Reinvented: Where Clients Come First

Most brokerages are built for agents, not for clients. These brokerages operate on a “siloed” model, where hundreds of independent contractors essentially rent desk space and brand affiliation, often lacking access to specialized resources and professional expertise.

DeLeon Realty doesn’t do “one-sizefits-all”

We’ve replaced the traditional “jack-of-all-trades” approach with a team of full-time elite professionals who collaborate seamlessly, just for you. Because our agents are salaried specialists rather than commissiondriven independent contractors, we have the resources to invest far more in professional expertise, services, and sophisticated marketing.

When every decision matters, you deserve a team built to win, not an individual agent hoping to double-end and maximize their commission.

A Suite of Services Like No Other

Our unique model gives you access to an unprecedented suite of complimentary services that no traditional brokerage can match:

• In-House Expertise: Licensed real estate attorneys*, interior designers, and construction consultants are on your team, ready to guide every decision.

• Industry-Leading Home Preparation: We pay for your home’s high-end staging, comprehensive inspection reports, and select handyman services, handling

every detail so your property looks its absolute best.

• World-Class Marketing: Your home receives Silicon Valley’s most aggressive marketing program, spanning TV commercials, radio, direct mail, multiple newspapers, and extensive outreach to the Chinese and Indian communities, among others.

Unmatched Value. Lower Costs.

Despite offering elite full-service support and more marketing, our average commission remains lower than any other major Silicon Valley brokerage.

We achieved this by pioneering a fairer way to do business: we never take a commission from both sides of a transaction. If a buyer comes to us directly, we waive 100% of the buyer’s side commission, passing that massive savings directly to you.

At the same time, outside buyer’s agents are compensated exactly as they would be at on any other agent’s listing, ensuring a seamless and fair process for all parties.

The magic isn’t just in what we do. It’s in how we’re built. See why DeLeon Realty sets the standard in Silicon Valley real estate.

* Legal services, if needed, are provided by the Integra Law Group, LLP, at no cost to our sellers.

Tax Tips: 1031 Exchanges, Installment Sales and Deferred Sales Trusts

By Ken DeLeon and Michael Repka

As the sagacious Benjamin Franklin noted, “nothing can be said to be certain except death and taxes.” While very true, death can sometimes help lessen taxes, as your heirs receive a stepped-up basis on inherited real estate after you pass. With tax day approaching, this article highlights three strategies to reduce your capital gains while you are still living and able to enjoy the savings. With DeLeon Realty having several attorneys on staff, we can guide you on which of the following strategies may work for your circumstances and how best to implement them.

Strategy #1- §1031 Exchanges

The most common real estate tax-saving strategy to take advantage of is the 1031 exchange. This powerful statute allows you to sell an investment property and defer paying capital gains taxes, so long as the timing and other requirements are met when purchasing another rental property.

With Silicon Valley homes appreciating amongst the most in the nation, coupled with California having the highest combined state and federal capital gains rate of 37.1%, many of our sellers face the prospect of paying up to seven figures in capital gains taxes.

Strategic planning can allow you to utilize a 1031 taxdeferred exchange to postpone paying capital gains. From the IRS viewpoint, if you sell one investment property and use the funds to purchase another investment property of equal or greater value, then no tax should be due.

While 1031 exchanges are used solely for investment properties, you can convert your primary residence into an investment property, thereby becoming eligible for a 1031 exchange. If you live in a highly appreciated singlefamily home, DeLeon Realty can guide you on how to convert it into an investment property and thereby defer capital gains.

I am a strong proponent of 1031 exchanges and have personally utilized them, as well as advised many clients on how to implement them properly.

Strategy #2 - Installment Sales

An installment sale is a legal term used to describe a transaction in which the seller finances all or part of the purchase price for the buyer. In effect, the seller acts as the buyer’s lender.

Under the installment sale rules, taxpayers are permitted to defer recognition of tax when at least a portion of the proceeds is received after the tax year of the sale. In other words, the United States and California impose tax on sellers as the sale proceeds are received, not in the year the sale is completed.

A simple example is the sale of a house for $5 million structured so that the taxpayer receives $2 million in 2026 plus $300,000 each year for the next 10 years, plus interest. The taxpayer would recognize a significant amount of gain in 2026, but the gain on the deferred portion would not be recognized until it is received. Not only does the taxpayer defer tax on a substantial amount of gain, but most taxpayers will also pay tax at

a lower blended rate due to the graduated capital gains structure. Another benefit is that you earn interest on the larger pre-tax amount, since no tax is charged until the principal is repaid.

An installment sale can be particularly useful in Silicon Valley because there are many buyers from foreign countries, such as China, Vietnam, and India, who may be quite wealthy in their home countries, but face delays due to currency migration rules. As a result, these buyers may be willing to pay more for their new homes, plus interest that can be as high as 6 percent, if the seller is willing to carry a note for a portion of the sales price.

If organized properly, this can be a very secure structure. However, it requires careful analysis of several key factors before proceeding. DeLeon Realty has the legal expertise and resources to ease this burden for clients.

Strategy #3- Deferred Sales Trust

While installment sale treatment can be highly beneficial under the right circumstances, it may not work with every buyer. Ultimately, the installment sale structure requires a buyer who is willing to structure the transaction in this manner and who represents a minimal credit risk with a substantial down payment, for example 40 percent. Attempting an installment sale in the wrong circumstances can be disastrous and should only be pursued if you are using a real estate agent who is also an attorney and can address all of the potential tax and legal issues that may arise.

The good news is that there is an alternative with broader application: the deferred sales trust. Although there are several variations of this structure, they are generally consistent in approach. First, the homeowner transfers the property into an irrevocable trust managed by an independent trustee. This independence is critical because the seller must avoid constructive receipt of the sale proceeds.

The arrangement is structured so that the property is sold and the proceeds are then invested by a money manager. As with most investments, there is a wide range of options, from very conservative to more aggressive strategies. The proceeds are subsequently distributed to the seller over a structured period of time.

The beauty of this structure is that sellers invest the entire pre-tax deferred amount and therefore have the opportunity to achieve a higher return. Additionally, they may benefit from graduated capital gains tax rates by spreading the gain over multiple years.

Determining which, if any, of these tax-efficient strategies is best for you is a discussion you should have with a knowledgeable tax professional, such as a CPA or attorney, after a careful review of your personal circumstances. DeLeon Realty is the only brokerage in Silicon Valley with attorneys on staff who can provide clients with tax guidance and help explore strategies to lower tax liability.

Will the New SALT Tax Deduction Cap Benefit Home Buyers?

By Alexander Lewicki, Esq.

When the Big Beautiful Bill was signed into law in July of last year, one of the more impactful tax breaks included was the increase of the state and local tax deduction (SALT) cap from $10k to $40k. In theory, the SALT deduction helps ease the burden of local taxes in regions with high living costs by allowing taxpayers who itemize to deduct up to $40k from their federal taxes for state taxes such as income and property tax. There’s no doubt that this increase is immediately beneficial for taxpayers in California.

But one comment I’ve heard echoed throughout the real estate community is that this SALT increase was going to be beneficial to homebuyers, easing the burden they would feel from high property taxes. Many were championing the increase as a pivotal motivator for new homebuyers as we enter the 2026 market and beyond. And frankly, as someone in the business of real estate, I wish that were the case.

Simply put, the average homebuyer in Silicon Valley, especially here in towns like Palo Alto, Los Altos, or Menlo Park, where an “entry-level” home is in the $3-$4 million range, is a high earning individual. The largest state income tax bracket in California is 9.3% for earners up to $376k. This rate, composed of the most tax payers, gradually increases to the maximum tax rate of 13.3%. For most homebuyers in our area able to afford the high prices of homes, those individuals are very likely to be earning in the

range of $200k+ per year, or $400k+ for a married couple. At a 9.3% tax rate, that same couple is already hitting their new $40k SALT tax deduction on state income tax alone, leaving no respite from their property taxes. And for those who may not be earning these high wages, they are likely not feeling any real estate related benefit for other reasons: they either cannot afford to purchase a home or, in another likely scenario, benefit more from taking the $31.5K standard deduction for married couples, so they opt not to itemize and thus forego the benefits of SALT altogether. Of course, the new SALT cap also comes with a phase-out beginning at $500k/ year (joint income for married filers), and sunsets altogether at $600k of income, where it returns to the original cap of $10k.

All of this is not to say that the SALT cap increase won’t help shoulder some of the taxes Californians pay to the state. Californians at large will certainly feel the benefits as we enter tax season. One such scenario is the homeowner who inherited a home and had it partially or fully reassessed due to Prop 19. Perhaps now they can more easily afford to keep up with the high property taxes in California.

So, while the SALT cap increase is great news, it’s very unlikely to motivate homebuyers in California, especially here in Silicon Valley.

Silicon Valley’s Growing Interest in Napa Valley Properties

By Francis Lopez, Director of Listings

Six years after the onset of the pandemic, lifestyle changes persist. Many companies have adopted more flexible work schedules in a variety of ways that make remote work a possibility.

At DeLeon Realty, we have seen a consistent flow of people moving outside of the Bay Area, with many targeting low or no tax states known for their exceptional lifestyle.

More recently, however, we have seen an increasing number of Silicon Valley executives purchasing second homes in more accessible locations, where they spend weekends and several weeks out of the year.

Lake Tahoe, Carmel Valley, and Wine Country have been particularly popular choices.

Here is an example of a spectacular property located in the Napa Valley area.

1129 Dealy Lane in Napa presents a special opportunity. This property listed at $9,800,000 includes a 6,400 square foot main house, a 2-bedroom/2-bathroom guest house, plus golf, pool, tennis court, BBQ area, and a 6.8 acre pinot noir vineyard. The property also has a conditional commercial use permit.

Listed by Will Lance (DRE# 01931900) with W Real Estate. If you are interested in learning more about this unique property, please contact Will at 707.367.4066 or visit www.1129DealyLane.com.