As people continue homing in on where they want live, we find ourselves in a renaissance moment that continues to elevate the burbs over the metropolises for all the obvious reasons.
According to BAREIS MLS, April’s data points indicate that Sonoma County buyers successfully contracted to purchase 578 single-family homes – 186 percent greater than just a year earlier and held back from being even more so by the lack of inventory available. Property owners delivered 476 new listings to the market during the period – 43 percent more than last April - while the County saw a trend affirming 589 sales reach fruition by months end – 137 percent greater than in 2020.
The compression within our markets is easily understood by realizing that the spike in buyer demands coupled with reluctant sellers over time creates a chasm that inevitably forces prices higher to tempt sellers to market. This prolonged immense activity has created a frenetic pace causing available inventory to zoom off the shelves while less is being restocked, leaving just 596 single-family homes to carry over into May – a stunning 24 percent fewer available listings than a year earlier. The voracious demand for homes has driven the median price to a new high of $775,000 while also establishing one of the Bay Area’s highest absorption rates of 99 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.
Still less voluminous though more voracious, Marin County’s marketplace showcased just 191 new single-family offerings – 36 percent more than a year earlier. Buyers promptly absorbed another 276 homes into consummated contracts – 136 percent greater than in 2020 – further echoing the chasm being felt in adjacent markets. Sellers closed out 295 transactions during the period - compared with 101 last year at this same time - leaving the entire region with only 178 homes available for buyers to peruse in May. Marin’s extreme pace indicates an absorption rate of 166 percent – an absorption level never experienced in Marin and providing further evidence of the continued pressure being created by the deurbanization movement away from the core Bay Area metropolises. Marin affirmed last month’s all-time high with respect to its median value closing the month at $1,690,000.
Napa County’s markets are benefitting from similar trends as sellers managed to deliver only 116 new homes to market this last month – nine percent greater than in 2020. Buyers rushed in to grab 149 new deals – 112 percent greater than last year - while sellers closed out a remarkable 138 sales in the period. This left the region with just 200 available dwellings heading into May - showcasing a 69 percent absorption rate along with median values closing the period at a new all-time high of $945,000.
Don’t take this the wrong way, but the activity at hand reminds me of an iconic moment from the Oliver Stone directed Tom Cruise starred in - Born on the fourth of July - epic film where Tom’s character professes an enduring statement about our country, “love it or leave it!”. We are fortunate to have settled in this haven and even though times rise to challenge our feeling and beliefs we maintain a greater perspective on the greater why behind choosing to live here.