Welcome to 2012! May it be your best year yet and may all your real estate dreams come true!
Where is the Real Estate market headed for 2012?
The real estate market is already off to a more energetic start this year than last year at the same time and I do believe, as most experts tend to agree, that the worst is over and that 2012 will be the year housing turns the corner and starts heading in a more positive direction.
It’s been a bumpy ride for the real estate market in the past five years as witnessed by a drop of nearly 40% in housing prices nationwide. Click here for an update on the 2011 national real estate market. However, as positive factors–low interest rates and the lure of affordability—and negative factors–the dark cloud of foreclosures, stiffer lending requirements and the struggling economy—continue to offset one another in 2012, we can expect prices to finally stabilize, setting the stage for gains in 2013 as the economy continues to recover. Of course the European crisis and the uncertainty of the elections could throw a wrench in this cautious recovery.
On a local level, Marin County has weathered the storm better than most areas as one of the most thriving economic areas nationwide. The Bay Area continues to create jobs and attract investments, and Marin County leads the state with the lowest unemployment rate at 6.5%, as recently reported in the Marin IJ.
Signs of recovery in Marin County
As 2011 came to an end, the signs of a slow and guarded recovery in our market were evidenced by a slight increase in the number of sales—up approximately 4% compared to 2010–, continuing a three year upward trend. Single family homes unit sales went from 1,831 in 2010 to 1,917 in 2011, and condo unit sales went from 479 in 2010 to 583 in 2011.
Sales by Price Range
It is important to note the shift in the percentage of homes sold by price point in the past six years: in 2005, half of the sales were in the $800,000 to $1.5 million range and 28.5% of the sales were below $800,000. In 2011, the trend reversed and almost 55% of the sales were below $800,000 and 30.26% of the sales were in the $800,000 to $1.5 million range.
Single family home median prices have trended down, pressured by short sales and REOs and the shift in market mix, dropping 20% from $941,000 in 2005 to $721,000 in 2011 and average sales prices from $1,211,000 in 2005 to $957,000 in 2011. Most analysts attribute about half of the average price decline to loss of value, with the other half attributable to market mix, as seen above.
Below is a chart illustrating the trends for all property types for the county and each town/city for 2011 as compared to 2010.
Low Inventory and Pent Up Demand
While many areas of the country are struggling to liquidate their high inventory, Marin County finished the year with a meager 413 single family homes for sale, compared to 552 at the end of November: a 25% drop in inventory and to 719 in December 2010, a 43% drop!!
Why is Marin’s inventory so low compared to the rest of California’s? It is in great part the product of our no-growth policy: because of the limited number of newly constructed homes, sales of homes from sellers moving up to bigger homes or downsizing to smaller ones have traditionally fueled the bulk of the activity in our market. As many homeowners are under water, they are postponing their move up or down.
Single Family Home Inventory – Marin County
City by city Analysis
As a result of the low inventory, the percentage of homes in contract is very high, with almost 41% of all homes in contract in Marin County. Here is the percentage of homes in contract per city as of January 3, 2012.
Greenbrae continues to lead the pack with over 50% of its listings in contract. Belvedere, on the other hand, has only one of its homes for sale in contract out of 21!
Affordability is at an all time high
This could be one of the best times in the past twenty years to buy real estate in Marin County, as long as you are buying to hold for a minimum of five to seven years. The market fundamentals—low home prices and historically low interest rates—create a unique window of opportunity. Savvy, qualified buyers striving to take advantage of this increased affordability have encountered fierce competition however as inventory remained stubbornly low all year, as discussed above.
In the last few months I have represented several clients involved in multiple offer situations. With the shortage of inventory, well priced, well presented homes in good locations are generating a lot of interest and often receiving multiple offers. Here is a chart illustrating the national housing affordability index for the period 2008-2011.
I am working with several qualified, motivated buyers who cannot find a home in Marin County! Sellers thinking about putting their well-priced home on the market in the near future will likely attract serious activity.
Have you formulated your real estate plan for this year, the next 3-5 years? I would be happy to sit down with you to help you evaluate the value of your home if selling is on the horizon for you, and to help you craft a plan if buying a Marin County home ranks among your goals for 2012.
I am here to serve. Feel free to contact me at 415.505.4789 or Sylvie@YourPieceofMarin.com.
About the author: The above Real Estate information on Marin County Real Estate was provided by Sylvie Zolezzi. I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789. I specialize in residential real estate in beautiful Marin County, just north of the Golden Gate Bridge.
My goal is to provide you with the best home buying or selling experience possible by combining my business and financial experience with meticulous attention to detail and a warm, personable and caring approach to meeting your needs. I have an excellent track record as a successful, results-oriented negotiator and effective communicator. My analytical skills and understanding of current market conditions, along with my ability to utilize a broad range of cutting edge technological and marketing resources, make me an invaluable real estate resource.
I am a long term Marin County resident and home owner. I strongly believe our quality of life is extraordinary and practically unmatched. I love our community, quaint towns and vast open space and never tire of their breathtaking beauty. I know the neighborhoods, the schools, the amenities; I know where you want to live. I know and love Marin County!
I service the following towns in Marin County: Sausalito, Tiburon, Belvedere, Mill Valley, Corte Madera, Larkspur, Greenbrae, Kentfield, Ross, San Anselmo, San Rafael, Fairfax, and Novato.