As households adjust to the times, we continue to see a fundamental shift from crowded larger cities to both nearby choice suburban locales and even out of state movements. As the tech sector along with other business realize they can achieve relatively high productivity when allowing their employees to work from home, more and more people are looking to alter the landscape of where they settle into residency.
As our markets work to return to normal operations, we are seeing amazing activity lead to noteworthy trend line moves. According to BAREIS MLS, July’s data points indicate that Sonoma County buyers successfully contracted to purchase 648 single-family homes – a volume not seen in over a decade and 54 percent higher than just a year earlier. Property owners delivered 411 new listings to the market during the period – 25 percent fewer than the prior July – while the County saw a stunning, and trend affirming, 577 sales reach fruition by months end – 34 percent greater than a year earlier. This immense activity is causing available inventory to fly off the shelves, leaving just 761 single-family homes to carry over into August and clearly establishing one of the Bay Area’s highest absorption rates of 76 percent.
The absorption rate is calculated by dividing the total number of homes sold in a month by the total number of homes available for sale at the end of the same month. A high absorption rate – 20 percent and above – indicates that the supply of available homes will shrink rapidly, thereby increasing the odds that an owner will sell a property in a shorter period. Conversely, an absorption rate below 15 percent is indicative of a buyer’s market, meaning homes are selling more slowly.
Marin County’s marketplace is confirming a robust path as well. July showcased 158 new single-family offerings – 12 percent fewer than last year – with buyers quickly latching onto 304 newly consummated deals – 77 percent greater than in 2019 - while also being a volume not seen in well over a decade. Sellers closed out 297 transactions during the period leaving the entire region with 272 homes available for sale – 33 percent fewer than last July. Marin continues at an even hotter pace than surrounding markets as the absorption rate spiked to 109 percent and further suggests our residential markets are the beneficiary of a fundamental migration from larger metropolises.
Similarly, Napa County’s markets are benefitting from the trends expressed above with just 120 new homes making their way to market during the period. Buyers jumped in to secure 175 ratified contracts while sellers completed 160 sales during the period leaving this region with 307 homes available to the marketplace as we open the doors to August. This stint of activity showcased a 52 percent absorption rate – and still accelerating, just not as quickly paced as Sonoma and Marin.
People who live in denser locations with shared elevators, public transportation, mutual yards and parks are looking towards making their home where they can have greater space and autonomy that allows them to put some enjoyment back into their lives. Which is why our region is seeing so much attention. Looking for your slice of the wine country, look no further, we got your back!