Many First Time Home Purchases are Condos
Single-Family homes, Townhomes and Condominiums, for the most part, make up our landscape of housing here. With size, scale, proximity to one another, and of course, cost all coming into play when selecting what type of living best suits your situation.
In the world of Condominiums here in the North Bay, Sonoma County, with a population of nearly 500,000 people, is experiencing increased activity by both sellers and buyers within this market niche’. According to BAREIS MLS, Sonoma County limped through 2024 with shallow activity when it came to the volume of available new listings – inevitably tempering the demand or ability for those interested to buying into this marketplace.
Condos in Sonoma County on average are typically configured as two bedrooms, two baths boasting 1,069 square feet of conditioned living space. In 2024, buyers purchased 337 units at a median value of $444,000, reflecting an average of $421 per-square-foot and essentially flat with values from the prior year. This segment of the market started out 2024 with an absorption rate of 55%, then surged in the early months to as high as 185% before waning as the year wore on and closing out the year at 39% riding the roller coaster of interest rate moves throughout the year.
The absorption rate is calculated by dividing the total number of units sold in a month by the total number of units available for sale at the end of the same month. A high absorption rate – 20 percent and above – indicates that the supply of available properties will shrink rapidly, thereby increasing the odds that an owner will sell a property in a shorter period of time. Conversely, an absorption rate below 15 percent is indicative of a buyer’s market, meaning homes are selling more slowly.
Further down the HWY 101 corridor, Marin County - with about half the population as its’ neighbor to the North - is still feeling like a market controlled by deedholders even though sales and activity levels were off slightly from where they were in 2023 and, similarly to Sonoma County, the average properties in this region are comprised of 2 bedrooms and 2 baths with 1,135 square feet of living area.
As 2024 wrapped up, condo seekers in Marin had purchased 379 units – 11% fewer than the 428 sold in 2023. The median price of a unit in this county can fluctuate mightily though closed out the year at $664,500 – a 4% slip from the $694,500 in 2023 – while still indicating a value of $592 per-square-foot. When comparing this to the absorption rate, Marin County properties were trading at a 33% clip as the year kicked off then surged as high as 54% before tightening mightily near a balanced rating of 19% then once again escalating to close the year at 46%.
In 2024, both Sonoma & Marin markets absorption rates moved in cadence, and we anticipate the trends established over the final few months of the year to continue to build momentum into 2025 at a gradual pace.
Photo by Luke van Zyl on Unsplash
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