A New Year’s Photo by Leo Merle (Snowy Egret):
Wine Country Real Estate Trends in December 2016
My Personal Motto for 2017: As the agents in my office know, I choose a “Personal Motto” every year and keep it close by. This year, I’m borrowing a quote from my Grandfather, R. A. Brotemarkle, Professor of Psychology at the University of Pennsylvania in the 1950’ and 60’s:
“Ability to do your task, adaptability to meet changing conditions of life and move on to that position in which you will serve others most happily, and a balanced sense of humor are absolute essentials for success in life; and the greatest of these is humor, for so long as a man can laugh at himself, so long will he grow, and the world be better for his living in it.”
The Home Buying Decision: David Brooks, columnist for the New York Times, author (“Bobos in Paradise”…) and commentator (PBS NewsHour) recently wrote an article entitled “The Home Buying Decision”. In my view, it gives the best description of the home buying process that I have ever seen. I think that it’s worth looking at to understand what we Realtors do so I’m attaching a link to it here: http://nyti.ms/2hZePDk. Enjoy!
Wine Country Market Value Shifts and Sales Trends for 2016: I’ve done a chart of Wine Country Market Value Shifts dating back to 1998. I’ve added the latest data for 2016 so if you’d like a copy, drop me an email. According to my figures, the price of residential real estate across Wine Country (Sonoma and Napa Counties) increased by 7.4% in 2016. I’m expecting about the same in 2017. There were 6,572 closings of single-family homes and condominiums across Wine Country in 2016 compared to 6,964 closings in 2015. This is 5.6% decrease in volume. All of this decrease in volume resulted from a 7% decrease in volume in Sonoma County (5,138 in 2016 compared to 5,529 in 2015) while Napa Country was steady year over year at 1,435 units. I expect the 2017 volume to be about equal to, or slightly down from, the volume in 2016.
Wine Country Real Estate results for December 2016:
Sonoma County: The inventory of homes and condominiums available in Sonoma County at the end of December (520) was 3.5% lower than the inventory in December 2015 (539) and was 21% lower than the inventory last month (658). We should see, perhaps, one more month of declining inventory through the end of January and then a pick-up in February. New sales (282) in December were 3.3% ahead of the pace of last December (273) and were 16% below the pace of last month (334). There is a 1.8 months supply of inventory in Sonoma County based on the existing sales pace. In comparison, in December 2007 there was over a 14.5 months supply of inventory. The time it takes to sell a home in Sonoma County (Days on Market) is 66 days. The median price of homes closed in December in Sonoma County was $561,000. This is a 7.9% increase over the median price in December 2015 ($520,000). The current median price is just 5% below the peak median price for the County ($589,000) recorded in June 2005. So, it can be said that close to all of the value lost through the recession (2007 to 2011) has been regained in the Sonoma County market.
Sonoma County Luxury Homes: About one quarter of the inventory in Sonoma County can be characterized as Luxury Homes (listing price in excess of $1,300,000). There has been a 5% increase in the number of Luxury Homes closed (284) from 1/1/16 to 12/31/16 compared to 270 from 1/1/15 to 12/31/15. The pace of new sales (23) in December this year was two times the pace of a year ago (11). There were 123 luxury properties in inventory at the end of December compared to 169 last month and 118 a year ago. The Days on Market for Luxury Home sales was 137 days this December compared to 160 days a year ago. This compares to 66 Days on Market for all closed properties in the County in December. There is a 5.3 months supply of inventory of luxury properties based upon the current sales pace compared to a 1.8 months supply in the overall Sonoma County market. It continues to lean towards a “Buyers Market” in the high end.
Cloverdale: The inventory of homes and condominiums for sale (12) in Cloverdale at the end of December was 59% lower than the 29 homes in inventory in December 2015 and it was 14% lower than the 14 homes last month. This is the lowest inventory in Calistoga in the last three years. There were 7 new sales in Cloverdale in December. This is ahead of the 5 sales in December 2015 and slightly below the 9 new sales last month. There is a 1.7 months supply of inventory based on the current sales pace. The Days on Market of the 11 homes that closed in December was 58 days compared to 80 days last month and 62 days a year ago.
Coastal Sonoma: The inventory of homes and condominiums for sale in Coastal Sonoma (Bodega Bay, Jenner and Stewart’s Point) at the end of December (22) was equal to the inventory a year ago (22) and slightly below the inventory last month (24). There was just one new home sale for the month of December compared to 3 a year ago and 3 last month. The Days on Market of the 5 homes that closed in December was 91 days compared to 96 days last month and 127 days a year ago.
Healdsburg Trends: The inventory of homes and condominiums available in Healdsburg at the end of December (66) was 54% ahead of the inventory in December 2015 (43) and was down 15% from the inventory last month (78). This continues to be a relatively high level of seasonal inventory for Healdsburg. There were 19 new sales in Healdsburg for the month. This is 19% ahead of the pace in December 2015 (16) and 280% ahead of the pace last month (5). Obviously, the new sales in November were very low. The months of available inventory based on the current sales pace is 3.5 months. The Days on Market for the 8 homes closed in December was a whopping 190 days compared to 79 days a year ago and 86 days last month.
Oakmont: There were 18 homes in inventory in the community of Oakmont at the end of December. This is slightly lower than in December 2015 (19) and slightly higher than last month (16). There were 8 new sales for the month. This is 43% below the sales pace of a year ago (14) and 27% below the pace of last month (11). There is a 2.3 months supply of inventory based on the current sales pace. The Days on Market for the 12 homes that closed in December was 51 days compared to 58 days a year ago and 56 days last month. The median price for homes sold in Oakmont in the past year has ranged from the mid-$500’s up to $625,000.
Petaluma: The inventory of homes and condominiums for sale in Petaluma at the end of December (49) is 14% higher than the inventory in December 2015 (43) and it is 15.5% below the inventory last month (58). There were 35 new sales for the month. This is slightly ahead of the number of new sales in December 2015 (32) and is 21% below the 44 sales last month. The Petaluma market has 1.4 months of available inventory based on the current sales pace. The Days on Market for the 45 closed sales for the month was 59 days compared to 58 a year ago and 51 last month. The median price of the homes that closed in December was $650,000. This is 8% higher than the median last December ($600,000).
Rohnert Park and Cotati: For the tenth time this year, the monthly sales in Rohnert Park-Cotati outpaced the level of inventory at the beginning and end of the month. There were 35 new sales in December compared to 41 last month and 31 in December 2015. Inventory began the month at 33 homes and ended the month at 18 homes. There is just a 0.5 months supply of inventory based on the current sales pace. This is the lowest level of inventory for Rohnert Park/Cotati since our charts were developed. By comparison, in December 2007, there were 13 times more homes on the market here – 242. The Days on Market for the 35 homes that closed in Rohnert Park and Cotati in December was 57 days compared to 54 days a year ago and 46 days last month. The median price ($490,000) closed in December was 7% higher than the median price a year ago ($458,000).
Santa Rosa: The inventory of homes and condominiums for sale in Santa Rosa at the end of December (174) was about equal to the inventory of a year ago (178) and was 19% below the inventory last month (214). New sales in December (120) were 15.5% below the pace of last month (142) and they were 7% ahead of the pace of last December (112). There is only a 1.5 months supply of available homes in Santa Rosa based on the current sales pace. The Days on Market for the homes closed in December in Santa Rosa was 65 days. The median price of the 120 homes closed in December in Santa Rosa was $550,000 compared to $478,000 a year ago – a 15% increase. The median has ranged from $500,000 to $525,000 over the past six months.
Sebastopol Trends: The inventory of homes and condominiums for sale at the end of December (25) was 11% below the level of December 2015 (28) and it was 31% below that of last month (36). By comparison, there were 97 homes in inventory in Sebastopol in December 2008. There were 11 new sales for the month of December. This is 35% below the pace of last month (17) and 39% below the pace in December 2015 (18). There is a 2.3 months supply of inventory based on the current sales pace. The Days on Market of the 17 closed homes in Sebastopol in December was 61.
Sonoma Valley: The number of available homes and condominiums for sale (69) at the end of December in the Sonoma Valley (Sonoma, Glen Ellen and Kenwood) was 8% ahead of the inventory in December 2015 (64) and was 30% below the inventory of last month (98). There were 25 new sales for the month. This is 56% ahead of the pace of sales in December 2015 (16) and it is 7% below the pace of last month (27). There is a 2.8 months supply of inventory in Sonoma based on the current pace of sales. The Days on Market for the 28 closed sales in Sonoma in December was 67 days. 42% of the inventory in the Sonoma Valley is priced at $1,000,000 or above while 40% of the new sales (10) were priced at $1,000,000 or more. The months of inventory for the $1,000,000 plus properties is 2.9 months. The high-end quartile (top 25%) of inventory in the Sonoma Valley at the end of December started at $$1,500,000. This compares to $1,900,000 last month, so a lot of high-end properties were withdrawn over the holidays. The months of available inventory in the top quartile is 4.5 months.
Windsor: The inventory of homes and condominiums for sale in Windsor at the end of December (23) was the lowest in the past fifteen months. It was 23% below the inventory in December 2015 (30) and it was slightly lower than the 25 homes last month. There were 14 new sales in Windsor in December – also the lowest in the last fifteen months. This is 30% lower than the sales in December 2015 (20) and 26% lower than the sales last month (19). There is a 1.5 months supply of inventory based on the current sales pace. The median price of the 16 sales that closed in December in Windsor was $567,000. This is 7% ahead of the median price ($529,000) of the homes closed last December.
Napa County: The inventory of homes and condominiums available for sale in Napa County at the end of December (259) is slightly below the inventory in December 2015 (265) and is 15% lower than the inventory last month (306). New sales (77) were 8% below the pace last year (82) and 24.5% below the pace of last month (102). There is a 3.4 months supply of inventory based on the current sales pace. The Days on Market for the 102 homes closed in December was 72 days compared to 80 days a year ago and 73 days last month. The median price of the closed homes in December in Napa County ($600,000) was 5% ahead of the median price of a year ago ($570,000). The median has generally ranged between $580,000 and $620,000 over the past year. The current median price remains 11% below the peak median price for the County ($675,000) recorded in June 2006.
Napa County Luxury Homes: If one takes the highest quartile (25%) of available inventory as the “Luxury Market”, the Luxury Market begins at $1,800,000 in Napa County at this time. The number of closings (90) of Luxury Homes (sales price in excess of $1,800,000) in Napa County is 20% ahead for the period 1/1/16 to 12/31/16 compared to 1/1/15 to 12/31/15 (81 homes). There were 68 luxury homes in inventory at the end of December 2016 compared to 83 at the end of December 2015. There is a 17 months supply of available Luxury Homes based on the current sales pace compared to 3.4 months supply for the County as a whole.
Napa: There were 151 available homes and condominiums in inventory at the end of December in the City of Napa. This is slightly higher than the inventory a year ago (146) and it is 12% less than the supply last month (172). New sales (46) were 25% below the pace of December 2015 (61) and they were 30% behind the pace of last month (66). There is a 3.3 months supply of inventory based on the current sales pace. The Days on Market for the 61 homes closed in December in the City of Napa was 68. The median price of the homes that closed in Napa in December was $605,000. This is slightly below the median price of the homes closed in December 2015 ($611,000). The median price is 7% below the peak median price in the City of Napa ($650,000) recorded in December 2006.
Up Valley Napa County: The inventory of homes and condominiums for sale in the Up Valley Napa County market (Angwin, Calistoga, Deer Park, Oakville, Rutherford, St. Helena and Yountville) at the end of December 2016 (74) was 11% below the level of 83 in December 2015 and it was 23% below the level last month (96). There were 13 new sales for the month compared to 12 a year ago and 21 last month. There is now a 5.7 months supply of inventory based on the current sales pace. The Days on Market for the 22 closings last month was 102 days compared to 92 days in December a year ago and 113 days last month. The overall county has 72 Days on Market. Sales take a bit longer in the Up Valley market. 56% of the Luxury Market (price in excess of $1,800,000) inventory (38 homes) in Napa County is in the Up Valley Market.