Archive for the 'Market updates' Category
Just opened up our weekly office sales update and was curious to see how sales activity was affected last week given the horrendous economic news.Â Had all business activity ground to a halt?Â Yes some folks are deciding to sit on the sidelines for a month or two or six.Â But what did I find for our office as a whole?Â IÂ found a very normal to high level of activity for the week.Â (I should mention that Coldwell Banker Santa Rosa has over 100 active agents and our sales totals are generally about double of the second ranked Sonoma County real estate office. )
30 New ListingsÂ (19 are bank-owned or REO properties-only 4 are priced over $500K)
29 New Sales (open escrows)Â 29 Brave souls who dared to put pen to paper last week and not run for the hills.Â On the sub-500 price range, about half appeared to be first time buyers and the rest investors.Â Â Â We normally run somewhere between 20 and 30 sales per week so this is a typical number.Â 19 of these are bank-owned properties.
22 Closed Sales of the closed sales, 14 were bank-owned properties.
The biggest trend difference we see is not the numbers of transactions but the price points and this is a consistent phenomenon since early 2008.
Of the new listings, only 4 were priced over $500,000.Â Of the closed sales, only 3 were priced over $500,000 and two of those 3 were priced over $1,000,000.Â Â By far the lion’s share of our business right now is the entry level priced bank-owned properties.Â I should mention that our office is home to James Madison, who has approximately 50% market share for REO properties in Sonoma County and some inventory in some of the surrounding counties as well.
Most Sonoma county realtors could spend a good four or five mornings per week touring new listings in Sonoma County. Some folks call them caravans. It would take at least 2 weeks of doing so to hit all the new listings on tour because of dueling chapter schedules and a large county.
What a Sonoma County Realtor could do every weekday morning
MondayÂ Generally quiet but groups such as Marketing Masters and Homescopes meet on Mondays, plus there are some office meetings.
Tuesday The main Santa Rosa Chapter meeting of NORBAR (the North Bay Association of Realtors).Â As many as 100 to 150 realtors attend a breakfast meeting, educational session and swap information on upcoming listings, buyers needs, rental requests and market updates.Â Property tour ensues for Santa Rosa.Â One week is East side, one week the west side. Mike Kelly cracks the whip so you’d better stick to business!
Wednesday The Sebastopol, Russian River and Petaluma chapters of NORBAR have their breakfast meetings –see above for the agenda.Â Sebastopol, Russian River and Petaluma property tours.
ThursdayÂ The Healdsburg chapter of NORBAR, The Cotati-Rohnert Park chapter and many of the large brokerage offices such as all the Coldwell Banker offices (separately), CPS and Prudential have their own sales meetings, marketing sessions and broker tours.Â Â Our Santa Rosa office (over 100 agents) meeting and tour covers the East side of SONOMA county one week and the West side the next.Â That means we could be looking at properties from Cloverdale and Healdsburg down to Petaluma on the same morning (theoretically!).Â This is why FOOD at broker open houses is so important, and water on hot days.Â Got to fuel the troops!
FridayÂ Friday morning is the weekly meeting of the Windsor Chapter of NORBAR and the Windsor tour.Â Cloverdale is in their somewhere as well.
That means the average Sonoma County Realtor could spend 16-20 hours per week at breakfast meetings, marketing sessions and on property tour and still not cover the whole county.Â How do you use your time?Â Â How much time every week do you tour and network with other realtors?Â What is the main benefit of attending these meetings?
(Next post an update on some interesting new listings on the market in Santa Rosa, from a lovely view home on 2 acres to 2 Rincon Valley bargains and and Junior College duplex.)
Supply and Demand
Every month I receive enough market statistics from Rick Laws, my broker, to fill reams of blog posts, even if there are no such things as reams when it comes to blogging. But you and I would be bored if all I wrote about was market stats.
Still this year more than ever, I am intensely interested in viewing trends looking backwards at the stats and comparing that perspective from that of being (literally) in the field live, with clients and other agents.
The chart below is from Brokermetrics and is based upon actual MLS (Multiple Listings Service) data from Bay Area Real Estate Information Services (aka BAREIS). It looks at the number of newly ratified contracts (pending sales not yet closed) versus the number of new listings month to month from July 2006 through July 2008, for all residential sales in Sonoma County, at all price ranges. This gives the most timely view of supply and demand based upon actual sales data, since pending sales take a couple of months to show up as closed sales. I can also slice and dice by price range, housing type and community, but won’t do that all today, promise.
An apparently typical seasonal rise in sales began in January with newly pending sales in March exceeding those of July 2006, leading to a dramatic increase in pending sales this July 2008 versus July 2006. Meanwhile the number of listings is trending slightly upward but is down overall versus two years ago. The vast majority of newly pending sales consists of bank-owned, or REO properties at the lower end of most markets. Month’s supply of inventory is down to six months, and fairly balanced, at the lowest point in quite some time. The market needs to digest these REO’s to achieve some stability, which it appears to be doing. If you have specific questions about Sonoma County real estate market trends, please contact me and I will pull some data for you.
You may ask where I’ve been as I have not posted regularly in the last couple of weeks. I have been on the run as many of my clients decided that once 4th of July had passed it was time to get going on new listings or to pick up their efforts for purchasing new homes. A very typically busy couple of weeks in an untypical real estate year. Despite the depressing news in the media, people still have legitimate reasons and motivations to buy and sell, and fully half of the market in Sonoma County has nothing to do with distressed properties. That half of the transactions last month DID have to do with distressed properties (bank-owned properties or short sales) is an amazing statistic, however, one we have discussed previously.
Two other factors (let’s call them the T factors) which have taken away from Blog post time however, have been Trulia and Twitter, hence the new links on my sidebar to the left. Trulia is a wonderful (“truly delightful real estate search” they say) combination of the social networking aspects of Facebook or LinkedIn and the search aspects of a Google.
Who networks on Trulia? Buyers and Sellers of real estate and all kinds of real estate professionals. I spent a few weeks in odd moments on Trulia fleshing out my profile and reviewing and answering multiple questions on Sonoma County communities or various real estate topics. It has been interesting to figure out the rules of the community (since I am not 20 years old and have only participated in LinkedIn and Plaxo in the past).
I’ve also enjoyed pitching in advice and comments on various communities in Sonoma County from Petaluma to Healdsburg, and networking with other agents locally and elsewhere. I’ve even managed to connect with a few buyers and sellers in the process, so there is a business justification for my efforts.
At the same time, everyone was talking about Twitter. I saw all these strange short posts on Kevin Boer’s 3 Oceans Real Estate site and could not make any sense of them. Seemed like a feature in search of a solution. UNTIL I joined in and got a Twitter Account of my very own.
Then the fun began–it takes a little bit to get Twitter, Kevin is convinced that the closer you are to age 20 the faster you get it. (the famous Twitter Age Co-Efficient, or TWAC). That may be true, but then I like to think I am the exception (long past 20) that proves the rule. Anyway the beauty of Twitter is that is a very non-linear web of group instant-messaging, hyper-linking of cool ideas amongst friends and friends of friends (and the whole Twitter world can be seen on one massive Twitter timeline. No post can be over 140 characters, which if you have read this far, you might be happy to know!
It makes for a fun break to sample the group chatter, but also has been a vehicle for serious communications. The first word of the massive earthquake in China came through tweets, as Twitter posts are known.
So I have been forced to be restrained and limit myself to shorter, more frequent posts, which you can see on the sidebar to the left. With Twitter I plan to post more frequent market updates, property reviews and timely short bits of information.
And a very interesting joint venture emerged from all this Twittering on Trulia and blogging about Inman connect. Wait till my next post!
It is going to be a gorgeous day to check out the latest West County new listings (Sebastopol MLS tour) tomorrow–I will have on my walking shoes and sunscreen, and James the trusty navigator on my TL will be well rested so he can plot out the best driving strategy for me and Izetta and hopefully another pal or two so we can economize on gas. (author’s note:Â I had hoped to Twitter my way through tour but that didn’t happen this week, maybe next time.)
Hopefully there will be some good munchies provided by the hosting agents since for some reason there are a pile of properties this week when there have been very few the last week or two. It is important for listing agents to incent their peers to tour their new listings, especially in a crowded field.
At one property last year (a country property listing of mine in Sebastopol) had so much going on that in order to convince agents to wait around and smell the roses, i.e. learn all the property had to offer, I had a masseur doing chair massages in one room, a lender pouring hot-mulled wine and apple cider in the kitchen, and bagels, lox and cream cheese for all. Two of us directed traffic and parking as well. I lost my voice after hours of tour-guiding. It was worth the effort because we had 3 offers the first week and sold for over asking to a buyer who is now very happy in his new country home. This in last year’s down market. What kind of creative broker tour incentives have you seen?
Anyway, I will report on the latest new West Sonoma County properties after tomorrow’s tour.
Heard on the Grapevine: In Healdsburg, I know of a great new listing coming up in early July–a classic Craftsman bungalow walking distance to the Healdsburg plaza. About 1600 sf with a new roof and paint, new deck and some interior updating, but a lot more room to improve (including the stand-up full length attic), or liveable and rentable now. It will be very competitively priced on a street with some gorgeous vintage homes. More info in the coming weeks.
Enjoy the lovely summer solstice week and tune back in for the tour and gravevine reviews and news. I also just received the latest Sonoma County Real Estate market stats so I plan to have a busy week of writing ahead. Headline: Sales continue to rise on the entry level of our market. Investors and first time buyers, and some first time investors (!) are out in force. Every day I receive an email report on the number of offers on bank-owned (REO) properties. Lots of multiple offers out there on the best ones with the best locations and best bones.
Ok so I admit that there is more to being successful in buying and selling real estate (as a realtor or an actual buyer or seller) than knowing market statistics. But the dynamics of this real estate market are changing so rapidly, and the various locations and price points add multiple additional layers of complexity, so that it bears spending some time looking at the numbers. Most of us also like to see if the trends on aggregate bear out our senses as we live and breathe in this market every day. So any of my clients or friends who ask me “How’s the market?” knows that I can wax poetic on the subject. Tongue slightly in cheek. 😉
Anyway, my broker Rick Laws, just released May’s sales statistic for Sonoma County to us this morning and the sales up-tick we noted previously appears to be continuing or even accelerating. Add that to the big news that the number of new listings is actually down 14%. This is for all residential sales in Sonoma County at all price points. I have asked Rick for some additional breakdowns. This is a rough pass of the data because as Rick says, some of the sales reporting for last month can be a little late and dribble in over the first 10 days of the month, which is when he normally compiles the stats that you see in the Press Democrat.
Closed sales are up slightly over last year at this time. But even more interestingly, newly opened escrows (sales under contract but due to close in 1 to 2 months) are up 68 percent this year over last. Even if some fall out of escrow, that is a significant boost to a trend we first noted here in early March. Even more interestingly, new listings are down 14% over last year. So where do you think the market is heading?
Please click on the image above to see one that is actually readable!
The trend we first noted in February is continuing in Sonoma County Real Estate Sales, led by our entry level market of homes under $500,000. Not only is the number of new CLOSED sales up to the highest point in over two years, the number of newly opened escrows (UNDER CONTRACT above) is increasing even more rapidly, on pace to close next month.
Many of these homes are bank-owned (REO’s) or short sales and the buyers consist of investors and first time buyers or folks who are down-sizing. The number of newly opened escrows in this category is up 274% over last year at this time. While buyers think they can offer considerably lower than asking, that is not necessarily true. I just opened escrow for a client in this price range and we were able to get a great property that had been on the market for some time (not a foreclosure) and ridden the price trend down. The perils of overpricing in this case benefited my buyer who is in contract to purchase this home for 33% less than the original asking price, and 15% under the most recent price. But the REO’s are now priced to sell for the most part and attracting multiple offers. One of the best deals I saw in Montgomery Village last week at under $320,000 had four offers within a few days of coming on the market and still the bank had not selected which cherry offer to pick. But even if this property sells for slightly over asking, it is a great solid home (in need of much TLC) on a prime street and lot with surrounding homes that will love to see this one fixed up!
Perhaps the big thud we heard in Sonoma County last winter was the sound of the market hitting bottom. We shall see. More stats and opinions to come on other segments of the Sonoma County Real Estate market this week.
Since I have been looking at the foreclosure market in Sonoma County, I decided to switch gears back to country property and take a look again at the health of that market. Tomorrow, May 18th, I am holding open a 2.6 acre country property with a spectacular view setting, usable for horses, gardening, grapes or getting away from it all. So I decided to look at the Sebastopol market trends for properties in a similar price range, $600,000 to $1.1 million dollars to see how prices and inventory are doing now, and over the last year. Some of my previous posts have covered this topic in the past. Here is a chart of Market Trends for the $600K to $1M price range for real estate in Sebastopol for the last year. The median price through April has risen from $735 to $765. With such a small sample size this number can fluctuate widely but the really startling number is the amount of listing inventory, which has declined from 93 last May to 63 now. Have the sellers been scared away? The number of accepted listings versus sales inventory is also a good indicator that this upward trend could continue. Perhaps it is because the foreclosure and short sales are in short supply in Sebastopol. That is why all real estate is local, and buyers and sellers alike can benefit by looking at market trends for their particular area. I heard a good reference the other day which stated that looking at national or statewide real estate trends to figure out what is going on in your market is like trying to predict your local weather by referencing a national average temperature of 57 degrees. Kind of hard to do. If you have questions on this data or would like to slice it a different way, please email or call me, or visit tomorrow at 2210 Pleasant Hill Road.
Of the 404 active foreclosure listings in Sonoma County today, here is a snapshot overview. For a more detailed look, and information on specific properties available on your own private web portal, please contact me directly and I will email you a report.
Of the 404 properties available today, the average number of days they have been on the market is 63 days. Buyers on top of their game are jumping on the best properties in the best locations (surprise, surprise) and many are subject to multiple offers, but generally under asking price. Banks are sometimes offering concessions such as credits to closing costs for certain repairs, but it really depends on the property and the competitive landscape. Of these properties, the minimum price is $101, 200. The maximum price is $1,249,000. The median price is $309, 975, well below the median sales price for the county.
Click the link above to get to a Google Doc which breaks the foreclosure market down by area within Sonoma County. Cotati/Rohnert Park, parts of Santa Rosa, Windsor and East Petaluma are the most effected whereas communities such as Sebastopol and Healdsburg have very few foreclosure properties on the market. Also, the price points tend to be the lower ones with the median price at just over $300,000.
Sunday April 27th Update:
Just popping by to update yesterday’s post with a link to today’s article on the hardest hit parts of Sonoma County by Michael Coit of the Press Democrat.Â I guess we are on the same wavelength today.
Currently there are 404 active listings on the MLS for Sonoma County that are bank-owned foreclosed properties, also known as REO’s.Â Many real estate investors and first time home buyers are seeking out real estate bargains here due to the large number available.Â Investors had fled the county for a number of years due to rapid appreciation but the proliferation of bargain priced bank-owned (REO) properties and short sales have attracted them back.Â As a realtor, I often am asked by clients where the best deals are, and sometimes they are surprised that not every type of property is a potential bargain, nor are they equally dispersed throughout Sonoma county.
Bottom line:Â There are foreclosure properties out there, and probably more coming through the remainder of â€˜08.Â Buying such a propertyÂ requires research, patience, ready cashâ€¦and a bit of a stomach!Â Support of your team may be helpful to some andÂ crucial for othersÂ (be it contractor, accountant, real estate professional, loan consultant, or parents).
If youâ€™re interested inÂ starting your own online research, I just got this tip from Kevin Boer about foreclosureradar.com.Â Iâ€™ll beÂ tracking it along with where I currently have an account, Realtytrac, to look forÂ San Mateo County trends.Â My Realtytrac research has shown their properties to be pretty out of date so I may try to find another one to use as a comparison to foreclosureradar.Â If you know of another good one, make a comment to share with everyone.
By the way, colleague Sam Benson at Real Estate 680 in Contra Costa county is opining on the same subject.
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