Today I had the pleasure of walking a 7+ acre pinot noir vineyard property with my client, planning our strategy for a maximum impact market debut of her Russian River appellation home. Here’s a sneak preview picture of the Mt. St. Helena view to the Northeast. What a tough day at “the office.”

Posted via email from pambuda’s posterous

Now there is good news for others who might want to buy and even for people who want to sell their home and move up to a different one.

Just this afternoon both houses of Congress have approved an extension of the $8,000 first time homebuyer credit, and expanded it to include a $6,500 credit for move-up buyers who have been in their homes for at least five years. The bill will go to President Obama for his signature. Income limits have been raised to allow for more upper income buyers to participate fully and the credit will be available through April 30, 2010, and up to two months longer for homes in escrow as of April 30 of next year.

The expansion of the credit to existing homeowners is meant to spur sales activity in the critical move up market and may be enough of a push to get some sellers and buyers off the fence. In many markets the entry level homes are selling rapidly and prices have come up somewhat from the bottom. The mid-ranges have been slower. It will be interesting to see how this new aspect of the credit works for move-up buyers.

For more details and resources on who qualifiies and how you can take advantage of the credit, please contact me or visit the National Association of Realtor’s website for details and how-to’s.

I recently wrote about the low “Month’s Supply of Inventory” of homes for sale in Sonoma County and touched on our seller’s market, driven by homes for sale under $500,000. What does it mean to be a seller’s market these days? The best and most hilarious explanation I have seen lately was done by Kris Berg, of San Diego Castles Realty, in her movie directing debut. Scarily true.

Fast forward two years and there are only 2368 homes for sale in Sonoma County and 431 of them sold in October. So while the number of sales was down slightly versus two years ago at this time, the total number of available homes was down significantly. At the current rate of sales, there is only a 2.2 months supply of inventory. MSI measures the ratio of demand and supply. When the supply of homes for sale would be absorbed in less than five months at the current rate of sales, we have a seller’s market.

Generally a balanced market, meaning a level playing field for buyers and sellers, consists of a housing supply of 5 to 7 months. Deals are getting done and neither side feels that it has an upper hand. If you look at the graph below, it looks like we last had that between April 2008 and February 2009. That was when the first wave of foreclosures was starting to hit and sellers were reducing prices.

A buyer’s market is what we had in late 2007. Sales were slowing, inventory accumulating and prices were stalling or dropping. A buyer’s market is anything over 7 months supply, we were at 12.5 months. It peaked in December 2007.

What does this stat mean for you as a buyer or seller of real estate? It is a quick way to gauge price trends in a given market. But these numbers can be really misleading too because each town and area and more importantly today, each price point really varies. But that (and the anticipated coming wave of foreclosures) is a subject for some future posts.

I have some  great new tools available which will enable me to create and share Real Estate Market Statistics and Analysis to my (and your) heat’s content.   Here is my first post which contains a whole set of data looking at median price, units sold, days on market and month’s supply of inventory for all residential sales (single-family homes, condos and farms and ranches) in Sonoma County.  For those of you who like these things they will soon have their own page where you can revel in the data as much as you like.  I will also be drilling down further to look at country properties, specific communities and different price ranges because this is definitely not a one-size-fits-all market when it comes to real estate sales throughout Sonoma County.   Also, if you have a specific type of property or area you would like to look at more closely, please email or call and I will see what I can do.  Enjoy!

NOTE:Some pop-up blockers may object. Please let me know your experience with this mode of delivering fresh market stats!

Median Home Sales Price August 2008 through August 2009

Year over year the median Sonoma County home price dropped 5% to $359,000.  However, the apparent bottom for this market (whether a V, U or W is yet to be determined) was in February when the median price was $315,000.  Some of my smart buyer clients (you know who you are) are happily ensconced in homes they bought in January and February, sensing the (a?) bottom had arrived.  We (please forgive a pat on the back here) called it in March. The price increase is being driven by the shortage of entry level listings and multiple offer bidding wars driving what inventory is out there up in price.   Prices at the upper ranges ($800,000 and up, particularly over a million dollars) are very soft.  Choice properties in choice locations are selling, sometimes with multiple offers in Sebastopol, Healdsburg and Sonoma, but they are the exception rather than the rule.

13 month Real Estate Sales Trends Sonoma County

Inventory has dropped DRAMATICALLY.  Is this due to the shadow inventory of foreclosed being held back by the banks?  Or is it a reflection of the inventory that piled up before prices began their steepest decline, and the market caught up with reality?

The number or newly opened escrows, or sales marked “Under Contract” where the sale has not yet been completed, has been steadily increasing.  (NOTE:  Not all of these will close.  In fact a large number are falling out of contract. I had heard this week as many as 40% but do not have documentation of that fact.   I can tell you that most of the escrows I open for clients DO close but that is another story.)

Many bloggers and real estate writers have written about the decline of unit sales in August, which was unexpected.  What does that mean?  I am less concerned because the trend of newly under contract sales is steadily growing.  Time will tell if that data point reflects a trend, or if it is just an anomaly.

We don’t have the same construction budget as Cal-Trans and any possible shut-downs to traffic won’t cause the same commute complications as recently experienced in the San Francisco Bay Area, but we are undergoing some technical maintainence over the next couple of days.  So if you notice some odd behavior on our pages, or some missing links, our apologies in advance as we update our blog platform.  After nearly 2.5 years of existence, a little software overhaul is due.  It will enable us to improve our services and the look and feel of the site.  If you need to reach me please call or email or find me on Twitter or Facebook.

In 2009, your help is needed more than ever. It seems that ticket sales are down this year due to the economy, and the need to help abandoned horses is greater than ever.  This year’s event is at the beautiful Shone Farm of the Santa Rosa Junior College, on the border of Healdsburg, Forestville and Santa Rosa.

Please visit the Sonoma CHANGE website to buy your ticket for this fun event coming up soon on Sunday, September 20, 2009.   You’ll enjoy a great day with wonderful food, friends and family and lots of equestrian entertainment from dressage and jumping demonstrations, the chance to see and learn about all kinds of horses from Mustangs to Percherons and Friesians.  Enjoy drill teams, vaulting and carriage driving.  There will even be a Unicorn!  What a great way to spend a September Sunday and to benefit a great cause–the health and well-being of horses throughout the North Bay.  See you there!

If you can’t make it on the 20th, the CHANGE website will still accept your donation. If you would like more information about CHANGE, the video below will fill you in.

How does Yogi Berra relate to the current real estate market in Sonoma County, Ca?

Well as current clients of mine will tell you-they thought they’d found a perfect house. We’ll call it “Park Place”. Great commute location, walking distance to shops and restaurants, and best of all a vastly over-sized, 13,000 square foot park-like back yard (complete with its own redwood tree and veggie garden).  Unfortunately for them, 18 other buyers also thought it was a great property and the winning offer was not ours, even thought we went well over asking, my clients were extremely qualified first time buyers. In this case it wasn’t enough. But they gave it their best shot at a price that made sense to them and lived with the results.

After a four week break to take care of family obligations, my clients were ready to write an offer on another pretty interesting property.   Meanwhile, I had told the listing agent for the first property to keep us posted if something happened to the original offer.

Also we  kept an eye on things.  We don’t want to rely on an overburdened REO listing agent. To make this easy for everyone, I set up a private web site for my clients updated in real time with changes to the MLS (Real Estate Multiple Listings Service). You may not realize it but most public facing websites are not reliably up to date, so a property could be back in escrow and not available again before you know it.

In this client website, we can keep homes in “Newly Matched”, “Saved”, and “Rejected” Tabs.  That way we are in sync and can both keep tabs on things so to speak. With my out of town clients, the “Comments” feature helps my get to know their preferences pretty quickly.
Back to the Yogi Berra situation: the same day we were writing on place number 2, I received a phone call from the listing agent on “Park Place” –the house of the 19 offers. Apparently the first buyer could not perform due to problems with their FHA financing.   The 3`cash buyers had gone elsewhere.  My clients were selected next by the bank who owned “Park Place” (bank as property owner-is an “REO” for real-estate owned).

Long story short, my clients are now in escrow to purchase “Park Place”.  Of course, it ain’t really over till escrow closes.  It is always wise for buyers of any property not to fall in love until they are moved in.  But this one, given up for good a month ago, looks pretty good now.

So thanks Yogi, for the real estate wisdom.   And I thought you were just a great catcher, hitter and 10 time World Series Champion!

We are in the thick of a hot summer market here in Sonoma County. Buyers have been coming back into our market in increasing numbers since late last year. Now, nearly every property sold under $400,000 has multiple offers. First time buyers or conventional buyers with ten or twenty percent down should expect to have to write offers on multiple properties before they get “the one”. There is only 2-4 months supply of inventory available at the current rate of sales (at price points under a million dollars).

What about the new wave of “shadow” inventory of foreclosure properties being held back from the market by the bank? At this point, it would appear that the market of existing buyers (both first time buyers and investors) will absorb it fairly readily.