Within the city of Santa Rosa, September’s BAREIS MLS data points to a marketplace executing along expected lines. We suspect buyer activity to continue to increase over the coming weeks, ahead of the hibernation period we experience around the holidays.
Santa Rosa recorded a Months’ Supply of Inventory (MSI) level of 2.5 – continuing to affirm that sellers are exerting more influence on the marketplace than buyers. MSI is the metric that indicates the number of months it would take to sell the current inventory of homes 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 higher ones favoring buyers.
That said, in Santa Rosa, sellers debuted just 134 single-family homes in September – 7% fewer than last year and another all-time monthly low, while the inventory of available homes in the greater Santa Rosa metro region stood at 342 as we rolled into October – 26% greater than in 2023 – meaning that buyers may have greater opportunities to find the right home than they’ve had in more than a year. Home seekers laid claim to 156 single-family Santa Rosa homes during the past month by putting them under contract – 13% more than last year at this same time – while sellers handed over keys on another 136 completed sales – 11% ahead of the 123 dwellings that traded just 12 months prior.
Northeast Santa Rosa, the North Bay’s broadest submarket, saw the introduction of 50 single-family homes in September, 8% fewer than this same period a year ago. The supply of homes was met with increased demand as there were 155 dwellings for house hunters to consider by months end – 15% more than during the same period last year. Buyers managed to absorb 61 homes into new contracts – 30 percent ahead of just a year earlier - with sellers receiving closing checks on another 52 properties – 21 percent greater than in 2023, highlighting a tighter MSI of 3.0 now. Keep in mind that in this submarket some of the new listings posted are offerings for homes under construction, which adds some unrealistic carryover inventory to what is actually available to purchase now, unlike most other submarkets throughout Sonoma County.
Southeast Santa Rosa saw the supply of listed properties rest at 56 as October opened – 30% more than just a year earlier. This submarket debuted just 16 new listings in September – 41% behind last year’s figures – while buyers garnered accepted offers on 31 additional dwellings – 24% ahead of a year earlier. This coveted corner of the city experienced 23 closings in the period resulting in an MSI stabilizing at 2.4.
Oakmont, a sprawling active adult community with more than 4,700 residents itself, has been experiencing exceptional demand from buyers while sellers responded with a lackluster nine new offerings in September. Buyers jumped in and grabbed 18 new deals while sellers closed out 11 more sales, leaving this region with 28 available homes for buyers to pursue in October, along with an MSI rising back to 2.5.
Northwest Santa Rosa remained extremely active by all accounts. In September, buyers advanced to control 31 more deals while leaving 73 single-family homes available for sale at the beginning of October. Sellers committed 42 new offerings to the market in the period while 37 additional homes crossed the finish line, allowing MSI to expand slightly to 2.0 – definitely still a sellers’ market.
Southwest Santa Rosa’s activity kept moving along as consumers placed 15 dwellings into contract during the period - just as sellers handed over the keys to 13 new homeowners – leaving 30 dwellings for buyers to view at the outset of October and a market experiencing an MSI of 2.3.
A tip about mortgage rates: Yes, interest rates got lower. But most people discovered shortly after the Federal Reserve’s announcement of those lower rates that mortgage rates actually went up based upon the better-than-expected economic data that followed shortly thereafter.
The moral of the interest rate story is that we take our cadence on main street from what goes on in the 10-year bond marketplace. This typically means if there is an intimation within these markets that the Federal Reserve will make a favorable adjustment on interest rates, then you are best to place the early bet on this and not wait for the actual event to lock in your long-term mortgage cost. Complacency is the enemy of greatness.
Jeff Schween is a “top 1% Realtor at Compass.
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