In May we saw the median home price in Marin County continue its upward march to $1,700,000, up 15% vs. May 2020 when the median home price here was $1,475,000. The number of homes for sale is down 40% vs. the same period last year, while average days on market declined 45% to just 23 days.
It appears the pandemic has taken the longstanding trend in Marin real estate – low supply driving higher prices – and thrown it into overdrive. While this is especially acute in Marin, this has swept the country as building slowed down during the pandemic while demand increased in many areas. While interest rates have crept up slightly from their lows last year, they are still very attractive when compared to historical interest rates.
My spring listings have all sold with the exception of one property, and I am busy preparing my exciting summer and fall homes which will be coming soon. I am currently working with clients to prepare properties in Novato, San Rafael and San Anselmo. I also have a 5-unit income property in Bodega Bay coming soon. Watch this space for more details!
My listing at 1100 Cabro Ridge in Novato sold last month for $4,275,000 setting a new record as the most expensive home sold in Novato since 2005 and the second most expensive sold in Novato ever.. The home was a stunner and was situated on a prime piece of land once owned by Sly of Sly and the Family Stone.
I am working with a record number of buyers compared to years past. More and more city dwellers are wanting to move to Marin to enjoy the weather, outdoor activities and great schools.
The Wells Fargo June Economic Forecast:
The U.S. Economy Is Heating Up. So Is Inflation.
“The U.S. economy continues to gather momentum. After rising 6.4% on an annualized basis in the first quarter, we now expect real GDP to expand at a robust 10.9% annualized pace in the second quarter (Figure 1). Overall economic growth should moderate a touch in the second half of the year; however, we expect real annual GDP growth to come in at 7.3% in 2021. If this above-consensus forecast comes to fruition, it would be the strongest year of growth since 1951. The underlying theme of our forecast remains the same: recent rounds of fiscal stimulus, substantial household savings and rising wages will propel consumer spending to historically strong rates of growth this year, as vaccinations significantly reduce the risk of COVID and more of the economy reopens.
Inventories of homes for sale have risen slightly in recent months, but remain near historic lows. The lack of homes for sale has led home prices to skyrocket, which now appears to be cooling off home buying. What’s more, building materials such as lumber, copper and steel remain in short supply, and prices for those items continue to soar. Material availability and pricing has emerged as a significant constraint, and home builders now appear to be dialing back new residential construction slightly. Similarly, back-ordered appliances and the sticker-shock that now comes along with most remodeling projects are likely holding back even stronger gains in home improvement activity.”
Bay Area Market Update from Golden Gate Sotheby’s International Realty
Excerpted from the monthly real estate market report from Golden Gate Sotheby’s International Realty:
Bay Area Reopening
With a full reopening of the local and state economy slated for mid-June, the Bay Area is on the cusp of life without business restrictions for the first time in more than a year. The housing market continues to accelerate, with strong demand at most price points. As office tenants reopen with more flexible schedules, daytime activity in downtown San Francisco and other concentrations of office buildings will rebound at a moderate pace. This has led, in part, to a rapid recovery in the San Francisco condo segment. Pent-up demand for goods and leisure services may lead to a robust summer and tourism volume should begin to recover in the region.
The robust spring buying season should continue even as pricing reaches new highs throughout much of the region. The acceleration in pending sales volume in the last few months indicates that closed sales should remain elevated into the summer. Mortgage rates should remain low in the near term and will offset some of the increase in home prices, but affordability will remain a primary constraint on potential buyers. The surge in pricing during the last year may push additional owners to list homes for sale, though the challenge for many of these owners will be to find a suitable replacement or trade-up home.
Additionally, as more Bay Area employers clarify remote work policies, some households may elect to relocate outside of the region, potentially adding inventory to the market. As the regional economy recovers and businesses are allowed to reopen, the already robust housing market should accelerate into the second half of the year.
Fidelity Investments just published an article about the current housing situation.. The current thinking is that demographics and low interest rates may help keep housing prices up at the national level:
“House prices nationwide have risen about 11% over the past year, as measured by the S&P CoreLogic Case-Shiller National Home Price Index, amid tight supply and hefty demand. That’s nearly twice the 10-year average and much faster than most buyers’ incomes have grown, which is why some experts have begun to raise concerns about an eventual housing bubble.
“Yet it’s not on the horizon based on what we see as of early spring,” says Bill Maclay, co-manager of Fidelity® Real Estate Income Fund (FRIFX). “Market shocks can’t be ruled out, but as long as rates don’t run away from us, I think we’ll see stable housing prices or gains,” Maclay says.”
We have returned to “business as usual” except masks are still required for unvaccinated attendees of property showings and open houses.
How Can I Help?
These reports are a great place to start, but let’s continue the conversation. I am always happy to discuss the market and the best way to approach buying or selling a home in Marin County or the greater Bay Area. Call or text me anytime at 415-847-5584.
Homebuyer demand remained strong, with sales activity held in check by limited inventory. During the first quarter, regional sales totaled 11,628 homes, an increase of 42% from the same quarter in 2020. Sales activity in March rebounded substantially from the modest slowdown in February, despite an increase in mortgage rates, with nearly 5,000 homes selling throughout the region in March.
Compare with one year ago, the greatest increases in the pace of sales occurred in Alameda, Marin, Napa and San Francisco counties. Sales volume increased by more than 50% in each of the counties. Just behind this pace, sales activity increased by 45% in Santa Clara County.
The rebound in sales activity in March bodes well for the spring buying season. Despite a slight uptick in mortgage rates, demand remained strong and should persist through the near term. Gains in home values combined with vaccine optimism and a full reopening of the regional economy should lead to more homes placed on the market, which will help release some of the pent-up buyer demand.
As businesses reopen offices to workers, there may be some households that return to the SF Bay Area, adding to the residential demand. The surge in pricing in recent months will hamper affordability for some potential buyers as mortgage rates remain low relative to historical norms. Overall, the recovering economy combined with elevated demand for housing should continue to drive home values through the remainder of the year.
“For Sale” vs. Sold Home Prices vs. Median Home Prices
Marin Home Prices List Price vs. Sold
Marin County Months of Inventory Based on Closed Sales
Average Price Per Square Foot
Marin County Number of Homes on the Market
I hope you have found my Marin County Real Estate Market Report informative. Please feel free to add your comments, questions or suggestions in the comments section below. If I may be of any assistance in helping you attain your real estate goals, please call or text me at 415-847-5584 and I will be in touch right away.