Marin Market Update-Q3 2017

Marin.jpg

Nothing brought the meaning of home closer to home than the recent devastating fires in Sonoma and Napa. The Costa Group has a strong presence in these counties and a deep connection to the region as do many of our friends, family and clients. Our hearts go out to all those who have suffered loss during this tragedy and we look forward to helping them rebuild in the months ahead.

Besides the Red Cross, we feel NORTH BAY FIRE RELIEF sponsored by Redwood Credit Union Community Fund will best distribute funds to those in need. 100% of the tax deduction will go directly to support those affected by the fires. When you donate you can choose to support any of the four counties affected or designate โ€œallโ€. 

While there is much being written about the Sonoma and Napa markets and the impact this will have on their community and their economy, it remains to be seen if the fires might have an impact on Marin County.
                                                                        
It's still a little too early to tell the exact implications for us here locally, let alone those in Sonoma and Napa Counties, but rest assured there will be residual effects on housing and the economy in general -- both negative and positive.

A few things we know will be impacted:

  • More pressure on our local housing supply; more competition for homes currently on the market
  • Increased demand for our already tight rental market
  • Construction resources and materials will become more scarce delaying remodel and rebuilding projects in Marin, and may also have an impact on construction costs
  • A tighter job market with newly unemployed vying for available positions
  • Ancillary housing services -- architecture, design, appraisals, inspections, etc. -- will be in high demand

What can we do here in Marin to help our Northern neighbors? There has been such an outpouring of support and aid coming out of Marin County to our neighbors in the North. I'm heartened by the response -- everyone seems to have a connection, and never have those connections become more real and more strong.  The coming weeks, and even into the coming months are going to be critical for those who have lost their homes and have nothing. We must not let our interest or support fade as the fires are contained and as the camera crews leave. This rebuild will take a long time and require some attention into the future.

In the short term, we can:

  • Provide housing -- have an extra room, au pair unit or rental space? We're going to have to get creative here. Lilypad, a local company is offering an interesting solution to the shortage of housing -- the creation of second units out of single family homes.
  • Watch for specific needs for those impacted by the fires -- goods and services
  • Put your skills to work -- volunteer or align yourself with a charity/organization where you can make the biggest impact
  • Don't forget! The aftermath of the fires is the calm after the storm -- if you're not sure how to help, stay tuned... those individuals who have no homes and no jobs may need more support down the road than they do now.

And, what can we do learn about this tragedy to protect ourselves in the future?

  • Familiarize yourself with emergency procedures -- this could happen to us!
  • Double check your home insurance coverage and make sure you've got a strong policy in place
  • Now is a good time to stock up on water, supplies and other necessities; be prepared
  • Follow some of these guidelines from the Red Cross, 

Marin County Price & Volume

Regarding the market performance for this past September, Marin continues to boast strong numbers with both value up by 10.7% and units up by 16.6%. Our median price point in Marin is currently up to $1,286,000 vs. $1,191,500 this same time last year, but down from the recent market high of $1,325,000 back in April. Unit sales are up from last year with 173 homes sold in September, but that's down from the year-to-date high of 243 sales in June (showing strong closing activity from April/May sales).

Here is a quick recap of the current state of the market:

  • Rising housing prices in some areas, but stabilizing a bit in others (see price point chart below)
  • Inventory remains low, but there are still deals to be had out there! We are seeing many "opportunity" properties coming on the market -- those properties with some challenges, but big upside potential 
  • It's extremely competitive out there; multiple offers still happening for homes in desirable neighborhoods priced and presented well.
  • Cash is still king (at least in multiple offer situations) with many people waiving contingencies to submit a more attractive offer.
  • Interest rates are still really, really good though we expect to see those rise towards the end of year and even into 2018.
  • With a little flexibility, creativity and vision, you can still buy your dream home in Marin County!

Marin Single Family Homes Sales 2016 VS 2017

While the city-by-city numbers are a bit all over the place, and sample sizes not necessarily telling us the full story, we can still see nice gains in Fairfax, San Rafael, Greenbrae, Novato and Sausalito.  Interestingly, the high-end has dramatically improved from last year at this same time in Tiburon and Belvedere, Ross and Kentfield -- all nearly doubling their median prices (small sample size, but what is selling is at a higher price).  Mill Valley and San Anselmo each saw a bit of a dip in pricing, but this conversely represents a larger number of homes sold at lower price points in these two markets. Corte Madera showed an amazing bump of 74% year over year, with the six homes being sold ranging from $1.35 to $2.1 million.
 
Interesting stats from the California Association of Realtors:

  • The percentage of properties selling below asking price remained decreased to 37% from 41% last year. The percentage of properties selling above asking price increased from 29% last year to 31%. The percentage of properties selling at asking price increased to 32%. The net percentage of properties sold above asking price was -6%.
  • For the 37% of properties selling below asking price, the average percentage paid below asking price decreased to 12% from 13% last month, but flat from last year.
  • For the 31% of properties selling above asking price, the average premium paid over asking increased to 12% from 9% last month and 10% last year.
  • The share of properties that received multiple offers was 60%, down from 64% last month and 62% last year.  Also, the proportion of properties with three or more offers decreased to 38%. The average number of offers per property was 2.7 offers.
  • Home prices are more in line with the market as the proportion of homes that had listing price reductions decreased annually. The share of reductions was 23%, up from 21% last month and down from 31% last year.

Price Point & Days on Market

The condominium market in Marin county is clipping along at a nice place of 1.6% growth year over year. While there were drops in median price in some market (Fairfax, San Anselmo and San Rafael) that can be attributed to diminishing inventory in these communities with the majority of properties being single family homes. The number of condominium units increased in almost all cities across Marin with the exception being a big dip in Novato (163 units down to just 52), though the median price did rise by a slim .3%.  Sausalito saw a 19% dip in prices with just a few more units selling year over year.

Sales by City 2016 VS 2017

So an unanticipated fire took center stage for our report this quarter -- something no one anticipated and in which few were prepared to deal. As we step back and start assessing the damage, we do see light at the end of the tunnel and the hope for a steady rebuild on the horizon (San Francisco Chronicle "Economy to bounce back fast").  We give praise to the first responders, to those who rushed to aid our neighbors with offers of help and support. We are a resilient people and to see us band together to support each other is truly a marvel in this day and age. 

If you are thinking of buying or selling a home in Marin County, The Costa Group would love the opportunity to work with you. Take a minute to read our client Raves & Reviews and we invite you to contact us to set up a complimentary consultation to discuss your unique real estate needs.