Sonoma County Home Sales Drop but Pending Sales Increase Sharply
Newly pending home sales increased sharply this January as rainy weather and football did not deter buyers from writing offers on Sonoma County homes. Dig in to real estate market trends for Sonoma County based on data from the Multiple Listings Service....
Farewell to 2009, Welcome to 2010 and a New Decade
With 2009 moving into the rear view mirror, there has been much speculation among agents, clients and the press about 2010 and what portends in the housing market. Inman News recently published a sobering assessment of the events that will impact real estate markets in 2010, from increasing mortgage rates, tightening FHA credit standards, high unemployment and the expiration April 30th of the buyer tax credits. Real estate agents and brokers typically look forward to spring as the season where homebuyers come out in force and sales pick up. In 2010, the uncertainty created by the financial crisis makes it harder to bank on a seasonal uptick in sales -- particularly in markets hit hard by unemployment. Further complicating matters down the road are three potentially destabilizing events that are expected to occur in a tight timeframe during the spring buying season: * At the end of March, the Federal Reserve is expected to wind up a $1.25 trillion program that's kept mortgage rates low. * The Federal Housing Administration's announcement that it plans to tighten underwriting standards could take effect as soon as April. * Congress is expected to allow the newly expanded homebuyer tax credit to expire, closing the door on buyers not under contract by April 30 and closing by June 30. Economists must rely on a certain amount of guesswork in predicting what impact these changes will have when drawing up their forecasts for 2010. Many expect unemployment won't peak until next year, and it's almost certain mortgage rates can only go up from record lows. But housing was hammered so badly, and for so long, that most forecasters expect housing prices to stabilize and sales to pick up in 2010, even if economic growth doesn't spring back as fiercely as it usually does in a recovery. "We are definitely in a recovery now, but this has been such a severe recession -- we think the financial crisis and the credit retrenchment that's occurred means this is going to be a fairly anemic recovery," said Michael Fratantoni, the Mortgage Bankers Association's vice president of research. America has moved from a manufacturing to service-based economy, meaning "there's not as much potential for a snapback" from a recession like the Reagan-era boom of the 1980s, Fratantoni said. These events certainly will impact markets nationwide, but each area will respond differently. Many of us...
How's the Market for Country Property in Sonoma County?
When Sonoma County real estate prices were booming in 2004 and 2005, those of us who sell country property noted that appreciation was lower for country properties than it was for "standard" homes on suburban lots. Now we know why--it was the rapid expansion of mortgage lending to first time buyers and investors which really spurred the market for entry level homes. It did ultimately push up the prices for country homes in the county. I thought I would pull the most recent sales data from our MLS (multiple listing service) to see what price trends have been like for country property over the last two years. For the purposes of this post, I pulled homes listed as single family residences or farms and ranches on lots of 2 acres or more. You can get a property that might feel like country with a smaller lot size, but 2 acres seems like a practical dividing line in terms of what most people want. The County of Sonoma uses 2 acres for a dividing line for some of the zoning designations in terms of housing density, allowing second units on some lots of 2 acres or more. (note: don't assume because you are interested in a property on 2 acres that you can build a second unit on it--it is way more complicated than that, contact me for specifics). A 2 year low 12 units of country property sold in March of 2009 and 2009. The highest month's sales total was 33 last October (very interesting due to the financial markets last fall.) The rate of sales seems to be picking up in the second half of this year. It generally bounces around in the teens and twenties, spiking towards 30 occasionally. Not the largest sample size which is why I am including all county sales in these figures as opposed to breaking out Healdsburg or Sebastopol for example. Median price of country property in Sonoma County is down 14% since November 2007 when it was $1,200,000 versus $1,037,500 now. The lowest median price was in February (surprise!) at $620,000, just showing only the least expensive properties were selling last winter, not that individual property values fluctuated so much. Months Supply of Inventory is at a two year low of 6 months at the end of November versus 19 months two years ago--with a high of...
Sonoma County Median Home Price up $50,000 from Last Winter's Low
The median price of a Sonoma County home was $340,000 at the end of November, down slightly from $345,000 the previous month but up for the low hit last February of $290,000. This reflects several trends: shrinking inventory due to increased sales, initially led by the surge of entry-level home sales begun last spring, and followed by a late full increase in the sale of upper-end and mid-range homes. Most agents I talk to are upbeat about the coming market this winter and spring. We also wonder what the impact of the so called shadow market of foreclosures will bring to the Sonoma County housing market. If you were considering selling your home but reluctant due to the tough market conditions of the last couple of years, you might think about putting your home on the market this winter. Even with the holidays, there are a lot of buyers still active in the market. Please contact me if you would like to explore your options! ...
California resale inventory shrinking as median price rises for the 8th month in a row
This story from Inman News was published a day after my previous post about the national real estate market--and reinforces the point I was making about the differences in our market and its phase in the recovery process.California resale inventory shrinking | Real Estate and Technology News for Agents, Brokers and Investors | Inman News Inventories of existing single-family homes in California are dwindling, reaching just four months of supply as the sales pace picked up from September to October, the California Association of Realtors reported. Home sales historically trail off during the fall and winter months, CAR said, but affordable home prices, low mortgage rates, and the extension and expansion of the federal homebuyer tax credit are expected to drive home sales through the end of the year and into early 2010. Existing single-family detached homes sold at a seasonally adjusted annual rate of 562,400 in October, up 5.9 percent from September and 1 percent from a year ago, the group said. The months supply of inventory fell from 4.2 months in September and 6.1 months a year ago. A 6-month supply of inventory is about what analysts consider an even balance between supply and demand. It took a median of 34.1 days on market to sell a home in California in October 2009, compared with 45.5 days for the same period a year ago. At $297,500, median home price was essentially unchanged from September, but down 3.2 percent from a year ago. Although the $890 increase in median price from September to October amounted to 0.3 percent, it was the eighth consecutive monthly gain. CAR Chief Economist Leslie Appleton-Young cited that trend, along with continued strength in sales, as "signs that California has hit and passed the bottom of this real estate cycle." For the first-time since July 2007, she said, sales of homes priced $1 million or more rose in year-to-year comparisons, and the number of distressed sales as a share of total sales has shown considerable improvement since the beginning of the year. In Sonoma County and much of the Bay Area of Northern California, inventory supply is hovering around 2 to 3 months, reflecting the strong regional differences in the California markets. The Bay area and North Bay are limited geographic areas bounded by mountains, hills, the Bay and Pacific Ocean. In the central valley of California new home construction booms simply expanded communities into flat, seemingly limitless former farmland. ...
An Upturn in the Housing Market May Be Reversing – NYTimes.com
But what about Sonoma County and Northern California? If you read this article in the business section of today's New York Times, An Upturn in the Housing Market May Be Reversing - NYTimes.com you'd find very justifiable skepticism about the increase in real estate sales volume nationally that we've experienced this summer and fall. As some friends and I discussed at dinner in Healdsburg Monday night, no one is convinced that the economy is on firmly recovering footing, Wall Street enthusiasm aside. So are we up for a "W" recovery--meaning another downturn in housing prices? From the article, which discussed the latest Case Shiller Housing Index Report: The two housing price reports lag, by a month, the figures on the volume of home resales, which were issued Monday for October. Home resales jumped 10.1 percent to the highest level in two years, better than analysts had expected. Much of the increase was attributed to the $8,000 first-time buyer’s tax credit, which had been set to expire Nov. 30 but has been renewed through spring. Buyers who have already owned a home are now eligible for a $6,500 credit. While brisk sales volume should, in theory, push up prices, Maureen Maitland, the vice president for index services at S.& P., said the oversupply of inventory was acting as a brake. “You can look down the street and have 10 houses to choose from,” she said. About 3.57 million used homes are for sale, a number that has been declining but is still higher than the historic average. It represents seven months of inventory at the current sales rate. Ms. Maitland speculated that the housing market might follow a “W” pattern, as the price lows plumbed last spring are tested again this winter. It's all well and good to look at national statistics, but (and this is a cliche so forgive me)--looking at the national housing market to try to determine what is happening with home values in your neighborhood is like trying to know what the weather will be like by knowing what the average temperature in the US is at any given time. Just look at the paragraph above--7 months available inventory nationwide. In Sonoma County we have less than three months of inventory available county wide, and less than two months at the lower price ranges. Even at the upper price ranges we have about 10 months of inventory...
Windsor Housing Sales Trends different than rest of Sonoma County
This is the 7th of the series looking at housing sales trends in Sonoma County. Windsor, sandwiched between Santa Rosa and Healdsburg, has probably the most homogenous housing supply in the county, with many tract homes all clustered in the mid-price ranges. There are estate properties at Shiloh on the east side of 101, and many vineyard, horse and estate homes on the west side of town off Starr Road and others, and I often advise my country property buyers not to overlook Windsor because there are some beautiful wine country homes that can be easily overlooked in a search. But the preponderance are 3-4 bedroom homes priced in the mid-price ranges. Maybe that is why the recovery doesn't look quite so strong here yet in terms of prices. The median price in October 2007 was $620,000 and is now at $357,500, up from a low of $325,000 in April (not February!). Unit sales hit a near peak last month of 42 (the two year peak was 46 and the low was 11 in December 2007 when sales in the mid price ranges started their stall. Month's supply of inventory followed a steep decline from a high peak of 17.5 months two years ago to a low of 2 months over the course of September and October. I hope this series has been helpful! It has been interesting for me to look at individual towns in this way, and the stats seem to confirm my own impressions from my knowledge on the ground of the markets in each of the communities we've discussed. Each property, each location, each home is unique. If you would like some specific information about a home you are thinking of buying or selling, please let me know!...
Russian River Area Homes in Short Supply, but a Relatively Stable Market
As I reach Post 6 of this series looking at housing inventory trends around Sonoma County, I am struck by how relatively stable pricing has been in the Russian River area, from the farms of Forestville to the Redwoods of Guerneville and Monte Rio to the ocean at Jenner. Prices have always been lower "on the river" and the median has declined only 3% over the past two years, from $326,500 to $317,000. It hit a low of $190,000 in February and March of this year. Again-this probably has to do with an increase in sales in the mid and upper ranges after an almost exclusive focus on the low end of the market. Unit sales hit a two year high of 30 units in June of 2009 after a low of 8 last November, 2008. Unit sales usually are in the teens and twenties. Months supply of inventory is down to 3.6 from 5.8 two years ago. It did hover around 17.5 months last year at this time however. ...
Petaluma Housing Inventory Low and Median Price Increased Significantly
Here is Part 5 of my series looking at the supply of homes for sale (Months Supply of Inventory is the measure) in various Sonoma County communities. Petaluma consists of two MLS (Multiple Listings Service) areas-West and East--with very different characteristics. For the purposes of this post we will combine the two. It was very interesting to look at the trends here over the last two years because I think Petaluma is where the housing market crawled back over the bottom soonest. 80 units were sold in October 2008 which really put a crimp in supply for the winter months. The bottom was hit in February 2009 (noticing a pattern here?) when only 25 units sold, but sales are usually in the 20's and 30's. Median price was at $510,000 in October 2007 and is at $425,000 now, down 17%. But prices are up significantly from the low, which was $323,000. The median price does not fluctuate too widely in Petaluma compared to other Sonoma towns. Inventory peaked at an 8.5 months supply two years ago, but is a sparse 2.5 months now. ...
Sonoma Valley Available Homes for Sale Trending Strongly Downward
The Valley of the Moon represents the other Sonoma, not the county but the towns of Sonoma, Kenwood, Glen Ellen and Boyes Hot Springs. Sales volume ranged the last two years from a low of 15 units in December 2007 to a high of 45 units last May. The range of price points is very large, as in Healdsburg but overall the media price declined from $705,000 two years ago to a low of $323,000 in April 2009. It has bounced up and is currently at $390,000-down 45% over the two years, probably disproportionately aided by the slower sales of high end homes. Months supply of inventory was nearly 20 in October 2007, peaked at over 22.5 in December 2007 and is now tied for its low at 5.1 months, a seller's market. ...