Mid-Price Range Real Estate Trends in Sonoma County for 2008
My last post this week detailed real estate supply, demand and price trends for Sonoma County real estate.Â The story of last year was bargain basement pricing by the banks looking to clear their inventory of foreclosed homes.Â County-wide the median price dropped 30% year over year through December 2008.Â The bulk of the sales action was in the sub-$500,000 price range and really lower than that. It is possible to find single family homes under $300,000 and even under $200,000 in some cases.Â With conforming loan rates ducking under 5% for thirty year fixed rate loans, first time buyers and investors are snatching up properties at a record pace.Â Condominium sales are just as hot.
Meanwhile, let’s take a look at homes in the mid-range tier of pricing, between $500,000 and $1 million dollars.Â In this range currently you will start to see larger homes, possibly with acreage in communities all over Sonoma County such as Santa Rosa, Sonoma, Glen Ellen, Healdsburg, Sebastopol and Petaluma.Â Â The bulk of the lower priced properties are concentrated along the 101 corridor in Santa Rosa (primarily west of 101) , east Petaluma, Rohnert Park/Cotati and Windsor.Â It is not safe to over generalize about communities if you are looking for property however as we have a wide variation of homes and locales.
Here is a view of supply and demand for Sonoma County homes priced between $500,000 and $1 million dollars.Â The first chart shows the change, or lack of change, in median price over the course of 2008.Â Median price rose a modest 2.5% in this price range.
The reason prices did not drop drastically in this price range was that the supply of new homes dwindled at the same rate as the number of sales, as sellers who did not need to sell retreated. The rate of sales and new listings were cut in half year over year.
There was also a recalibration of pricing above a million and below $500K as properties sought new levels. Clearly there has been a less dramatic softening in prices but the median was left essentially unchanged.Â There was a slight increase in sales at the end of the year and a leveling of new listings coming on the market.Â What do you think this information means for the spring market?