Pacific Union’s Monthly Real Estate Update
Home sales remain strong in the Bay Area and Tahoe/Truckee as the end of the year draws near.
Typically, sales fall off in November and December, when holiday plans crowd out thoughts of relocating households, but we’re seeing only a slight dip in real estate activity this year from the frantic pace of previous months, with Pacific Union International’s regional offices reporting solid results for the month of November as measured by the percentage of homes in contract.
Typically, more than 35 percent of homes in contract indicates a sellers’ market and less than 25 percent reflects a buyers’ market. A balanced market has 25 to 35 percent of homes in contract. Other measurements, such as median sales price and months’ supply of inventory, also indicate an active real estate market as we move into December.
In Contra Costa County, the percentage of homes in contract continued to climb higher in November, with fewer homes for sale than the month before but more of them in contract for eventual sales — 55 percent in November, up from 52 percent in October and 31 percent in September.
The market for homes selling for less than $1 million was particularly strong, with 66 percent of homes in that price range going into contract by the end of the month, compared with 31 percent for homes priced over $1 million.
Pleasant Hill (77 percent), Concord (74 percent), and Moraga (67 percent) showed the strongest buyer demand for sub-$1 million homes. Moraga also had the greatest percentage of homes above $1 million in contract (60 percent), followed by Danville (46 percent) and Concord (40 percent).
The East Bay remains a sellers’ market, with 49 percent of homes in contract in November — up one percentage point from October and nearly three times the level in November 2010.
Kensington had a busy month, with 69 percent of homes in contact, up from 36 percent the month before, followed by Berkeley (58 percent), Oakland ZIP code 94610 — the Grand Lake, Lakeshore, and Crocker Highlands neighborhoods (56 percent), Albany (55 percent), and El Cerrito (54 percent).
More than half of all homes priced under $1 million were in contract, and 30 percent of homes above $1 million were in contract.
Marin County is one of the few regions where buyers are in the driver’s seat. Six cities had fewer than 25 percent of homes in contract in November — Larkspur (0 percent), Fairfax (7 percent), Ross (17 percent), Sausalito and Tiburon (both 20 percent), and Belvedere (22 percent). The countywide average of homes in contract was 35 percent, up from 32 percent in October.
Among homes priced under $1 million, 35 percent were in contract, led by Ross (100 percent) and Corte Madera and Kentfield (both 67 percent). An average of 20 percent of homes selling for $1 million or higher were in contract, down from 23 percent the month before. All but one city had in-contract rates below 25 percent, the exception being Kentfield (29 percent).
The hottest real estate markets in Napa County last month were the cities of Yountville, Napa, and Oakville, with in-contract rates of 78, 73, and 67 percent, respectively. Angwin had 48 percent of homes in contract, followed by St. Helena (15 percent), Calistoga (12 percent), and Rutherford (0 percent), for a countywide average of 48 percent of homes in contract. A month earlier the rate was 41 percent.
Homes priced below $750,000 were most in demand, with 124 percent of those priced below $500,000 in contract — meaning virtually all homes offered for sale at that price point in November, plus several from the previous month, were in contract. The next-highest percentage, 47 percent, was for homes priced at $500,000 to $750,000.
Only 10 percent of homes priced above $1 million were in contract.
In San Francisco, 41 percent of homes on the market were in contract in November, the highest level in years, continuing a trend we’ve seen through most of 2012.
The most active price points were for homes selling for $1 million or less: 47 percent in contract for homes priced from $500,000 to $750,000, followed by $750,000 to $1 million (41 percent) and $100,000 to $500,000 (45 percent).
Looking at individual districts, District 9 (Bernal Heights, Mission Bay, South Beach, and SoMa) and District 10 (Bayview, Excelsior, Outer Mission, and Visitacion Valley) were the most active, with 91 and 65 single-family homes and condominiums under contract, respectively, followed by District 5 (Cole Valley, Eureka Valley, Haight-Ashbury, and Noe Valley) with 60 homes in contract.
The supply of homes for sale in Sonoma County and Sonoma Valley dropped 24 percent from October to November, and the number of homes in contract shrank similarly, down 25 percent. The percentage of homes in contract, however, held steady at 59 percent.
The most active market was for homes priced up to $500,000. Homes in that price range accounted for 41 percent of all active properties on the market, and nearly half of them were under contract by the end of the month.
The hottest market for homes priced under $1 million was Rohnert Park, with 85 percent of homes in contract, followed by Petaluma (76 percent), and Santa Rosa (74 percent). For homes priced above $1 million, Healdsburg had 13 percent in contract.
The average price of homes for sale in the Tahoe/Truckee region topped $600,000 in November, the highest level in more than a year.
The number of homes for sale continued to slide since a peak in mid-summer, and the number of homes sold also fell, but at a slower rate. The upside to those numbers is that the market absorption rate — also known as months’ supply of inventory — jumped higher in November. That’s good news for potential buyers, who now have a wider range of properties to choose from.
The region had 10 percent of single-family homes in contract in November, the lowest rate in almost year, while condominiums in contract rose to 12 percent, matching the highest rate in at least two years.