This is what we are experiencing within our marketplace now and have been since the beginning of the pandemic. As populations migrate from urban centers to more suburban locales the request for larger homes with more amenities and more spacious surroundings has been the chart topper. Throw in new or more recently built homes - or those that have been freshly remodeled - along with a pool or room for one, and you get the picture.
According to BAREIS MLS, November’s data points indicate that Sonoma County buyers successfully contracted to purchase 436 single-family homes – 48 percent higher than just a year earlier. Property owners delivered 284 new listings to the market during the period while the County saw a stunning, and trend affirming, 413 sales reach fruition by months end – 12 percent greater than a year ago. The compression within our markets is easily understood by realizing that the spike in buyer demands coupled with reluctant seller’s over time creates a chasm that inevitably forces prices higher to tempt sellers to market. This immense activity is causing available inventory to zoom off the shelves while less is being restocked, leaving just 684 single-family homes to carry over into December – a stunning 23 percent fewer available listings than in 2019 - establishing one of the Bay Area’s highest absorption rates of 61 percent.
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 running even hotter than its neighbor to the North. November showcased 101 new single-family offerings with buyers promptly absorbing 215 into consummated contracts – 37 percent greater than in 2019. Sellers closed out 245 transactions during the period - compared with 188 last year at this same time - leaving the entire region with 243 homes available for sale as December opened. Marin’s extreme pace indicates an absorption rate of 101 percent – providing further evidence of the deurbanization movement away from the core Bay Area metropolises.
Napa County’s markets are benefitting from the trends expressed above though sellers rallied to deliver 91 new homes to market this last month – 44 percent greater than in 2019. That said, buyers rang the bell on placing 112 new deals into escrow while sellers closed out a remarkable 100 sales in the period – 25 percent above last year - leaving this region with just 251 homes available to the marketplace as we open the doors to December. This stint of activity showcased a 40 percent absorption rate and further denotes a supply shortened market ahead.
We cannot always control what happens to us in life, though we always decide how we handle it. This mantra of character that shapes each of us as people while propelling us through the pathway of life is at the core of who we are individually. The actions and reactions to life’s challenges begets all of us much like a grape on a vine, and we all know the grapes that are the most strained develop immense character which is denoted in each sip of the world’s finest wines and why those grapes command the highest value in the market. Cheers to you and a life well lived!