Residential Real Estate May Be the Winner

Though we are amidst an ongoing Shelter-in-place mandate, we still must look towards how our future may be reshaped. With many having discovered how to work from home we expect, for a myriad of reasons, that as we grow through this your home will be a more important part of your daily life than ever before. Indicators are showing that commercial retail and office space as we know it will shift to adjust to the consumer and the new work from home phenomenon – which means the way you live in and utilize your personal residence will have greater importance.
 
The Santa Rosa metro region, like most places on earth, has been maneuvering to find its way to the other side of living with a virus and what that means to our habits and routines. According to BAREIS MLS, with March in the rearview mirror, we find the marketplace absorbing hollow data points, but data nonetheless with 255 single-family homes remaining for sale in the city and its environs – six percent greater than this same time a year ago – coupled with an expanding level of activity as 126 single-family homes found their way into pending contracts during the past month – on par with last year even though the month was caught short mid-way through.
 
The entire municipality introduced 118 new listings to the market during the month – 34 percent fewer than in 2019 - while the most recent period also found Sellers handing over keys on 111 completed sales – the very same amount that closed a year earlier, even with SIP restrictions in place. These metrics showcase Santa Rosa with its’ Months’ Supply of Inventory (MSI) at 2.3.
 
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 generally indicative of a balanced market, with lower numbers increasingly favoring sellers and vice versa.
 
Getting down to the underlying specifics, Northeast Santa Rosa saw the introduction of 37 single-family homes in March. The supply of homes was met with solid absorption during the period as there were only 119 dwellings for home seekers to consider by months end. Buyers embarked on 35 newly initiated escrows while sellers received closing checks on another 37 properties - affirming a steadied MSI of 3.2.
 
Southeast Santa Rosa saw the supply of available properties sink to 34 by months end. This submarket debuted just 17 new offerings in March – 55 percent fewer than last year - while buyers garnered accepted deals on 24 more abodes – a 15 percent increase from the prior March. This coveted corner of the city experienced another 16 formal transfers of title as MSI steadied at 2.1.
 
With less inventory and more sales, Oakmont welcomed March with open arms as only 19 sellers delivered new offerings in the period effectively allowing inventory to shrink to 33 available homes by months end. Buyers found their way to acceptances on 10 new purchases while sellers concluded 18 transactions during the period – 80 percent greater than in 2019. The activity level indicates a market that has shifted from the chaos of the unknown and is now showcasing a very tight market as MSI reported at 1.8.
 
Outperforming all other regions of the city, Northwest Santa Rosa witnessed 41 new offerings this past month with buyers quickly absorbing 48 more deals into contract. Sellers completed the sale of 30 domiciles leaving this submarket with 51 available homes to roll into April while establishing that demand during the pandemic may actually be increasing for residential real estate with MSI at 1.7 and indicators pointing to even greater demand moving forward over the next month.
 
Similarly, Southwest Santa Rosa had merely four new properties make their way to market in March – 83 percent fewer than the prior year - with buyers promptly gaining control of nine houses in new agreements, this submarket was left with only 18 homes in play for April. Sellers still managed to close 10 deals - which is 11 percent more than last year even with the current sheltering requirements leading the submarket to an MSI of 1.8.
 
Our new environment is still evolving and though this may require us to be more prudent and safer in how we approach daily life, we will still have to go on with living. In doing so, it will require each of us to be more conscientious of our personal space and the environments we choose to interact with every day. If you find yourself strained over this, just reach out and let’s talk about it.

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