Sonoma County did as we predicted this last month as it showcased a strong demand for housing - much stronger than years past - or what we have come to experience at this time of year historically. As we near the second anniversary of the firestorms that besieged the North Bay, we are starting to see what we anticipated as a significant shift in local consumers demands and subsequent actions being taken.
The region typically sees definitive growth in inventory as each new year unfolds with peaks typically showing in spring and summer months while valleys appear in fall and winter. According to BAREIS MLS, August data points indicate that Sonoma County buyers successfully contracted to purchase 482 single-family homes – the most at any point over the last 12 months and well above the 402 that went into contract last year at this time. Property owners provided 363 new listings to the market during the period – 32 percent less than the prior year where a whopping 534 new listings came available - while transactions were completed on 387 dwellings over the last 30 days leaving 1136 available dwellings to carry over into September. The cumulative effect is still indicative of a market strengthening from last Summer’s doldrums with a steady and resurgent absorption rate of 34 percent and the median price topping $712,000 for the first time – further affirming the sluggishness witnessed in 2018 has been abated by lowered interest rates and renewed requirements from buyers.
The absorption rate is calculated by dividing the total number of homes sold in a month by the total number of homes available for sale at the end of the same month. A high absorption rate – 20 percent and above – indicates that the supply of available homes will shrink rapidly, thereby increasing the odds that an owner will sell a property in a shorter period. Conversely, an absorption rate below 15 percent is indicative of a buyer’s market, meaning homes are selling more slowly.
Marin County’s marketplace is indicating a similar, yet even more seller favored trend than their neighbor to the North. August showcased 122 new offerings – 38 percent fewer than last year – with buyers quickly latching onto 178 newly consummated deals. Sellers closed out 170 transactions during the period leaving the entire region with 400 homes as offerings for buyers to select from in September and further encouraging home seekers – still with an elevated absorption rate of 45 percent - to gain control of their new home ahead of further price increases.
In a similar trend - though at a less intensive rate - Napa County’s markets which were technically in balance six months ago are hanging on the cusp of favoring sellers once again. August brought 134 new listings to market – 17 percent less than the prior year - with buyers promptly absorbing 132 properties into new deals during the month. Napa sellers managed to complete the sale of 98 single family homes, leaving 442 more for the markets to ponder in September while causing the absorption rate to steady at 22 percent – not necessarily indicating a rally mode though certainly pointing towards a market supportive of current pricing.
The most important thing currently is to be in the now with a long-term approach to your future and where you will live. That’s what we are here for…pick up the phone and call or come on by to talk about it!