New Year – New Market Pulse
With prices having retreated a solid 10 percent from their peak last May, this recalibration of values
along with a steadier interest rate outlook for 2023 has started to meet with buyers expectations
allowing them to take up the pursuit of their new home with renewed vigor once again.
According to BAREIS MLS – with 2022 in the rearview mirror - the data points to a marketplace in the
process of establishing its new cadence with only 162 single-family homes remaining for sale in the city
and its environs – 12 percent less than this same time a year ago as well as a new all-time low. Buyers
laid claim to 66 single-family homes during the past month – a rate 43 percent less than a year earlier -
while the entire municipality introduced just 36 new listings to the market over the last month – 65
percent fewer than in 2021 and another new all-time monthly low. The most recent period found
Seller’s handing over keys on another 100 completed sales – 45 percent behind last year.
This measurable contraction is affirmed by Santa Rosa recording a Months’ Supply of Inventory (MSI)
level at 1.6 – a reversal of October’s expansion to 2.2 and possibly foreboding of lower levels of
inventory being made available within the marketplace. As foul weather clears and Pre-Spring listings
make their way out into the open, expect a new market cadence to unveil itself.
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.
Within the city, Northeast Santa Rosa – the North Bay’s most active submarket - saw the introduction of
just 11 single-family homes in December – 73 percent fewer than this same period a year ago while also
establishing a new all-time low inventory level and equal to the amount unveiled in all of Marin County
for this same period. The supply of homes was met with more active demand during the period as there
were merely 60 dwellings for home seekers to consider by months end – 31 percent lower than the
depths we were experiencing at this time last year while concurrently confirming another new bottom
when it comes to home options. Buyers still managed to absorb 28 homes into new contracts while
sellers received closing checks on another 41 properties – resulting in MSI reversing the prior few
months trend as it retreated to 1.5.
Southeast Santa Rosa saw the supply of listed properties rest at 26 by year end. This submarket debuted
just three new homes in the period while buyers garnered accepted offers on seven additional
dwellings. This coveted corner of the city experienced 14 formal transfers in December culminating in a
MSI reading of 1.9.
Listings in Oakmont fell but were more expansive than the balance of the Santa Rosa metro region
registering 19 active homes by months end with property owners launching but six new offerings during
the period. Buyers inked out another five new deals while sellers completed seven more transactions
before the year turned over, allowing MSI to rise to 2.7.
Still the only niche that has recorded higher inventory levels than last year at this time, Northwest Santa
Rosa buyers made advances to gain control of 15 more deals leaving 41 single-family homes available
for sale at months end. Sellers committed just 10 additional offerings to the market while another 19
homes completed the closing process leaving this region with a higher MSI reading of 2.2.
Southwest Santa Rosa found all-time new lows in many of these metrics above with sellers delivering
just six new offerings to the market while consumers placed 11 more dwellings into contract during the
period. Newly minted homeowners captured keys on 19 closings, leaving 16 homes available for buyers
to peruse in January while establishing an MSI drastically tightening to 0.8 – a very seller friendly
As the palpable pulse of activity on main street is indicating a significant rise in buyer interests the
window for balanced negotiations may be coming to a close, just like the erosion of pricing we endured
during the last seven months of 2022. Participants looking to stake their claim to a new home will need
to take actionable steps to secure it ahead of the current opportunities disappearing.
Stay up to date on the latest real estate trends.