Least Amount of Home Inventory Ever Under the Tree This Year
With the lack of widespread new for-sale housing being constructed coupled with the existing inventory of homes being financed at the lowest interest rates ever over the last few years, the marketplace has some significant headwinds when it comes to choices for buyers to acquire.
According to BAREIS MLS, Sonoma County had exactly 557 single-family homes left for sale at November’s conclusion – 12 percent fewer than this same period last year. Sellers delivered 199 new listings to the market during the month – 28 percent less than in 2021 - while buyers gained control of another 268 new deals – 33 percent off from a year earlier due to higher interest rates and lower inventory levels. In support of these metrics, completed sales tipped the scales at 279 this last month – 42 percent fewer than the prior year.
The continued pace of the markets can be measured by the months’ supply of inventory (MSI) and, with the Federal Reserve aggressively trying to dampen demand by raising the cost of money MSI has risen from its depths of 1.2 in December of last year to 2.0 as of last month – still indicative of a seller’s market though with buyers being able to have more influence on the terms of a sale.
MSI is the metric that indicates the number of months it would take to sell the current inventory at the current rate of sales. An MSI ranging from 4.0 to 6.0 is indicative of a balanced market, with lower numbers increasingly favoring sellers and vice versa.
Getting down to the details in the town of Sonoma, which submarket includes the hamlets of Kenwood and Glen Ellen, there were 81 homes reported for sale as November ended – two percent less than this same period a year ago. This region experienced the addition of just 18 new listings during the period – an all-time low influx of newly listed homes - while buyers garnered accepted contracts on 21 more properties. Sellers in the valley awarded keys to just 27 new homeowners – 41 percent off from a year earlier – allowing MSI to tighten to 3.0.
Healdsburg witnessed nine new listings arrive to the market last month – 50 percent fewer than in 2021. Buyers absorbed 19 homes in new deals while sellers closed out another 14 transactions leaving this submarket with 37 homes for presentation to buyers in December, along with an MSI retreating further to 2.6.
Petaluma’s Westside attracted just eight new sellers in November – matching this region’s all-time low for newly introduced single-family dwellings - which allowed available inventory to kick-off the new month with 34 homes for buyers to select from. Home seekers grabbed 12 new deals in the period while sellers closed out 13 purchases allowing MSI to rise to 2.6.
Sebastopol wrapped up the period with 38 available homes for buyers to consider inclusive of the eight additional offerings unveiled during the period – matching the all-time low as well here. Home shoppers placed 18 more dwellings into contract while sellers completed 20 sales causing MSI to inch upwards to 1.9.
Windsor property owners delivered another 14 new listings in November while buyers captured 15 deals during the period. Sellers closed out 20 more transactions leaving 23 single-family homes available for buyers to peruse in December while highlighting an MSI getting cut nearly in half to close the period at 1.2 – an activity pattern that has been repeating since Spring.
Looks like the Grinch has stollen supply and only time will tell if he discerns to part with it this coming year, and as interest rates ease, buyers may once again be scrambling to find their next home as they find themselves competing with each other once again. My advice is to take action when you find that home before the rest of the market catches up to you. The next few months will see this actionable window get tighter unless we find a new abundance of homes to select from.
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