Marin County Real Estate Market Update – January 2016

Our Marin County real estate market was painfully slow in January, and much more so than it typically is in the first month of every year. Was it the El Nino rains and persistent dark grey skies? The market crashes in Asian countries, especially China, that have sent ripple effects towards the U.S. and resulted in our stock market plunge? The fact that Superbowl 50 was right here in our backyard and everyone was really excited about it? I would surmise that it was probably a combination of all the above. Read my Marin County Real Estate Market Update for January 2016 to find out.

Marin County Real Estate Market Update - January 2016
79 St. Thomas Way, Tiburon – Courtesy of B. Bullock/L. Sarkissian, Decker Bullock S.I.R.

 

In my Year End 2015 Market Report  I discussed the most noteworthy takeaways for 2015 and what we can expect for 2016. But I don’t claim to have a crystal ball and it is hard to know what will happen in 2016. Six top economists have shared their forecast, predicting that

  • Growing rental rates and moderate home price growth should mean more people look to buy in 2016.
  • Mortgage rates will rise, which should also help boost numbers of buyers.
  • Inventory is expected to remain a problem, however.

However, as a result of  our stock market volatility and global economy worries, interest rates so far have been going down. “For the sixth consecutive week, mortgage rates were on a downward spiral as the 30-year fixed-rate mortgage hovers near its 2015-low of 3.59 percent,” Freddie Mac reported on February 12. This flight to quality is not unusual when the stock market is rocky and will likely keep the Federal Reserve from raising interest rates on mortgages. This augurs well for buyers looking to purchase this spring.

Despite the volatility in financial markets, surprisingly consumer confidence improved slightly in January, following an increase in December. Consumers’ expectations for the next six months improved moderately. It appears that, for now, consumers do not foresee the unpredictability in financial markets as having a negative impact on the economy. Buyers in Marin appear to be confident as we are continuing to see homes priced within a reasonable range of their final sale price moving quickly with multiple offers.


Talking about the spring real estate season, typically it kicks off right after the Superbowl when the  market wakes up from its post holiday slumber. And this year appears to be no exception.


Not only are there no more football games on Sundays, but this year the weather has also dramatically improved in February. The sunshine and  spring-like summer-like temperatures are helping in making the market abuzz with activity this month. We have already had 79 new single family homes listed for sale in the first two weeks of February, compared to 70 for the entire month of January. But inventory still  remains excruciatingly low.

In fact, the inventory of homes for sale in Marin County is at the lowest level it’s been in the last ten years. January 2016 offered only half of the average number of units for sale compared to January 2015, and 15% of the inventory of 2007, the height of the market.

 

Marin County Real Estate Market Update - January 2016

HOME SALES BY AREA

There was a decrease in the number of homes sales in January of 45% from December which was unexpected. Typically, December is one of the slower months as homes are removed from the market during the holidays. The decrease is largely due to the extremely low inventory.

Marin County Real Estate Market Update - January 2016

MARIN MARKET BY PRICE POINT

The $1-$2 million price range remains the leading price range in active homes on the market in Marin County. The under $1 million and $2-$3 million ranges follow closely behind with 32 and 31 active homes.

The high end market, which fared extremely well in 2015, appears to be promising again in 2016. A spectacular, newly constructed home in Tiburon priced at $13,500,000 went in contract within eight days of coming on the market this past week. Rumor has it the buyer made an offer without seeing the property in person. Here is a photo: what do you think?

Marin County Real Estate Market Update - January 2016
1860 Mountain View, Tiburon – Photo courtesy of Pacific Union

 

Marin County Real Estate Market Update - January 2016

HOMES IN CONTRACT

Fairfax leads Marin County for the month of January with the highest percentage of homes in contract at 100%. Larkspur and Novato follow closely behind at 71% and 60%. The month was the lowest for the Beach Cities and Kentfield, with 0% of homes in contract although the higher end market in Kentfield plays a large role in this percentage.

Marin County Real Estate Market Update - January 2016

AVERAGE SALE PRICE

The Marin County market experienced an increase in average list prices from December to January mostly due to low inventory in the lower price ranges. The average sale price has been decreasing starting in November as sellers who need to sell generally stay on the market through the year end and are willing to accept lower prices, particularly when their property has not sold during the peak of the season in the spring, early summer and October.

Marin County Real Estate Market Update - January 2016

 

NUMBER OF HOMES LISTED AND SOLD

The inventory in January is nearly half  of last January’s. Low inventory has been a problem in achieving a balanced market for the last few years. The sales, however, were roughly the same as the same month last year. Inventory is expected to be increasing over the next few months as we move in the listing season which typically starts at the end of February and into March and April.

Marin County Real Estate Market Update - January 2016

 

As a top Marin real estate agent I am always eager to work with you to help you accomplish your real estate goals. Whether you are interested in buying, selling, or just learning more about the market, I am happy to help.

I am well aware that this is a great time to be a seller and can be quite a frustrating time to be a buyer. Yet, keep in mind there are great properties out there and with the assistance of a trusted real estate agent to discuss the market dynamics with you and help you devise the best strategy to attain your real estate goals you can  be successful.

If you are planning on selling Your Piece of Marin this spring, now is an ideal time to prepare your property for a successful sale and I can help. Let’s strategize together. If  it’s time to buy, let me know so that I can give you the inside scoop on each neighborhood that may be right for you. Please call or text me at 415-505-4789 – I am always happy to chat!


Sylvie Zolezzi www.YourPieceofMarin.com

About the Author: The above Marin County Real Estate Market Update for January 2016 was provided by Sylvie Zolezzi. I am an award winning, top producing Realtor specializing in luxury residential real estate in beautiful Marin County, just north of the Golden Gate Bridge.

I offer a wide range of innovative and comprehensive real estate solutions for buyers, sellers and investors, attracting clients who demand excellence—in marketing, negotiations, market knowledge—and a genuine concern for their needs. My association with Decker Bullock Sotheby’s International Realty allows me to provide a high-end luxury experience to all my clients at every single price point. It also empowers me to leverage the unique combination of Sotheby’s global resources, Decker Bullock Sotheby’s International Realty’s growing market share and local knowledge with my unmatched social media networks to provide highly personalized service and unmatched exposure to my clients’ properties locally and worldwide.

I would welcome the opportunity to show you how I consistently get outstanding Real Estate results for my clients. I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789. 


Six Ways to Minimize Your Capital Gains Taxes When Selling Your Home

When selling your home, it is paramount to prepare in advance and formulate strategies to ensure success. Which Realtor® should you hire? When should you sell? How should you price the home? Should you make upgrades or remodel before going on the market? Should you stage the home? Landscape? There are many steps you can take to maximize the value of the home. But in order to net the most from your home sale, though, there’s another crucial strategy that should not be overlooked: planning to minimize your capital gains taxes as currently long-term capital gains tax rates run upwards of 20 percent, depending on your tax bracket.

Six Ways to Minimize Your Capital Gains Taxes When Selling Your Home

For homeowners lucky enough to have experienced large gains in the values of their homes in the last decade or two, even in the past few years, there are growing worries about how much of this upside they will have to share with Uncle Sam when they sell their home.

This is especially true in and around cities with thriving economies like New York, Boston, Los Angeles, San Francisco and San Diego, where home prices have increased the most. In these areas, homeowners can be liable for substantial capital gains taxes.


A capital gain in real estate is the difference between the sales price you received and your basis in the asset. The “basis” of a real estate asset is generally the price that you bought it for.


 

The U.S. Government recognizes the importance of home ownership by providing certain tax breaks when you sell your home.

There are several ways to qualify for these breaks, and keep Uncle Sam at bay, as follows:

1. Using the Capital Gains Exclusion:
Six Ways to Minimize Your Capital Gains Taxes When Selling Your HomeIf you sold a home before 1997, you may be pleasantly surprised to hear about the generous tax break you can get when selling your home today. The current law–The Tax Payer Relief Act of 1997– went into effect on May 7, 1997.

Here are the capital gains exclusion rules under our current tax law. Your sale qualifies for exclusion of $250,000 gain ($500,000 if married and filing jointly) if the following is true:

  • You owned the home and used it as your primary residence during at least 2 of the last 5 years before the date of sale.
  • You did not acquire the home through a like-kind exchange (also known as a 1031 exchange), during the past 5 years.
  • You did not claim any exclusion for the sale of a home in the past two years. If you recently were married, and your spouse claimed the exclusion in the past two years, you will have to wait until you become eligible again two years from his/her sale.

To use the capital gain exclusion to its fullest potential, tax expert David John Marotta writes in Forbes that you should consider a move whenever you’ve maxed out the capital gain exclusion on your home. Although you need to have lived in your house for at least two years to claim the exclusion, the IRS allows taxpayers to use the exclusion multiple times (but no more than once every two years.) This means you could potentially sell multiple homes at a large gain and never pay a dime in taxes.

As a result of these rules, families who stay in the same home for decades often face huge tax liabilities when they finally sell. More mobile families who are forced to move, or chose to move more frequently, avoid these taxes. The economy on the capital gains tax does not come without any effort and disruption in your family life, and is reduced by the cost of selling and moving repeatedly.

2. Adjusting your Basis with Capital Improvements:

Six Ways to Minimize Your Capital Gains Taxes When Selling Your Home
A Kitchen remodel qualifies as a Capital Improvement under IRS Pub. 523

If your capital gains exceed the exclusion amount that is applicable to you, you will want to dig out the receipts for all the capital improvements you have made to your home over the years (there is not time limit) to be able to determine your “total basis” and reduce the amount you owe. The I.R.S., in its Publication 523,  defines “total basis” as the total amount you invested in your home, which includes what you paid for your home as well as other money you may have invested in it to improve and add to its value.


Adding value is the key factor to remember here.


It is very important to distinguish between an improvement and a repair for tax purposes. Improvements are allowed to be included in your total tax basis, repairs are not as they do not add value. Understanding the difference between the two is paramount. It can get a bit tricky: painting your home, for example, is considered as maintenance. Refinishing wood floors is maintenance, too, though installing new ones is an improvement that you can add to your total of moneys spent in remodels.

Six Ways to Minimize Your Capital Gains Taxes When Selling Your Home
Excerpted from IRS Pub. 523

As you can see on the list I have copied from IRS Publication 523 , improvements and additions of all sorts qualify to increase your basis, including decks and patios; landscaping, including sprinkler systems; pools; a new roof or siding; insulation; and kitchen remodeling. Some smaller and perhaps surprising things are there, too, like the installation of utility services.

If you have not been saving your receipts, don’t panic. Start tracking them down, and if you misplaced them, contact the store or contractor who most of the time should be able to provide you with a copy of the receipt. And make sure to keep all the receipts until you sell the home, even after you have discarded your old tax returns.

If you have lived in your home for a long time, you may have forgotten some of the improvements you have made, I see it happen all the time. I recommend you look closely at the IRS publication 523 list to help jog your memory.

If you built your house from the ground up, you can add the cost of the land, all materials and any money you paid to contractors and their laborers plus architect fees. But if you did some of the work yourself, or had a friend or family member who helped you for free, then you are out of luck as the I.R.S. will not recognize the labor cost of that improvement.

If you live in a condominium or cooperative building or a community with homeowners’ association fees, some of your monthly dues and many of your special assessments may also count. Ask the managing agent about this, and require the building or community’s accountant to offer this per capita figure each year in a format that allows you to file it away and keep it.

The catch here is that you need receipts for every one of the upgrades you have made. Most homeowners don’t know about it; nobody tells you this at the closing table–except if you work with an agent like me ; I mention it to my clients. But do you hear it, and remember it?

I would recommend making photocopies of your receipts, as the ink on some old receipts fades away with time, and scanning them to keep a copy in the Cloud as well.

Conversely, if you’ve depreciated the asset (think home office depreciation for example,) or claimed some energy credits, you will have to deduct the amount depreciated from your basis.

3. Deducting your Home Selling Expenses:

Six Ways to Minimize Your Capital Gains Taxes When Selling Your HomeYou are allowed to deduct from the sales price most types of selling expenses. Such expenses may include:

  • staging
  • advertising
  • appraisal fees
  • attorney fees
  • closing fees
  • document preparation fees
  • escrow fees (if paid by seller)
  • notary fees
  • points paid by seller to obtain financing for buyer
  • real estate broker’s commission
  • recording fees (if paid by the seller)
  • costs of removing title clouds
  • settlement fees
  • title search fees, and
  • transfer or stamp taxes charged by city, county, or state governments.

Most of these costs will be listed in the closing statement prepared by the escrow company, bank or other financial institution, (or attorney, in some states) when you sell your house. Make sure you hold on to your closing statement. If you misplace it, contact your real estate agent to obtain another copy at tax time.

4. Doing a 1031 exchange:

Six Ways to Minimize your Capital Gains Taxes When Selling Your HomeIf you sell rental or investment property, you can avoid capital gains and depreciation recapture taxes by rolling the proceeds of your sale into a similar type of investment within 180 days. This like-kind exchange is called a 1031 exchange after the relevant section of the tax code, and it is one of the most underutilized sections of the code.

Perhaps the problem lies with calling the procedure an exchange as this creates a lot of misunderstanding and would be better utilized if this was re-labeled as a 1031 rollover because that is precisely what happens. The gain is rolled over to a new property. An individual can successfully rollover gain and postpone tax for an unlimited number of times. The ultimate goal is to make this tax disappear by one of two ways:

  1. Sellers may successfully rollover gain and ultimately move into one of their investment properties and declare it to be their primary residence. Provided they are married and have held the property for five years, reside in the property for a minimum of two years, they can exempt $500,000.00 in taxes upon the ultimate sale.
  2. Capital gains taxes are eliminated upon the death of the property owner. Heirs receive a step up in basis on the date of death.

If you want to enjoy the benefits of a 1031 exchange with your primary residence, you can move out and rent it for two years.

5. Doing an Installment Sale:

Six Ways to Minimize Your Capital Gains Taxes When Selling Your HomeI would be remiss not to include a paragraph about installment sales in this article, even though I believe this is a more complicated, and risky, solution. Installment sales of real estate are a form of seller financing. Instead of borrowing money from a bank or other financial institution to pay the seller, the buyer borrows from the seller. The buyer and seller enter into an installment agreement in which the buyer agrees to make a down payment and pay the remainder of the sales price over a term of years. It can be one year or hundred, it’s up to the buyer and seller to decide. The buyer also agrees to pay interest on the payments. Again, it’s up to the buyer and seller to agree on the interest rate—it can be higher or lower than the rates mortgage lenders charge. The seller ordinarily takes back a purchase money mortgage from the buyer. This way the buyer’s promise to pay the seller is secured by the property—that is, if the buyer doesn’t pay, the seller can foreclose and get the property back.

This is an option used by sellers who cannot benefit from the tax exclusion or for whom the proceeds of the sale would make them jump into a higher tax bracket if they received it all in one year. For more information, see IRS Publication 537 – Installment Sales and make sure to consult your CPA and/or financial advisers.

6. Not Selling in Your Lifetime:

Six Ways to Minimize Your Capital Gains Taxes When Selling Your HomeMost people die holding highly appreciated investments, including their home.  When you die, your heirs get a step up in cost basis, which is the property’s fair market value at the time of your death. When your heirs sell, they only pay taxes on gains over that stepped-up basis and avoid paying capital gains taxes on a lifetime of appreciation.

However, it can be quite emotionally, financially and even physically difficult for heirs to sell their parents’ home, especially if the home is chock full of belongings they will need to dispose of. Some people prefer to bite the bullet, empty their home, sell it and move to a retirement home to save their children from the burden of emptying the house.

For example, let’s assume you are single and your Marin County home has a basis of $550,000. Its current market value is $1,000,000 at the time of your death (current market value,) and your heirs will get a stepped up basis of $1,000,000. If they sell the property for a $1,000,000 they owe no capital gains tax. Had you sold the property for $1,000,000, assuming you had $50,000 in improvements, you would likely have owed taxes on the fair market value minus the total basis minus the $250,000 deduction as a single person: $1,000,000 – ($550,000 + $50,000) – $250,000 = $150,000. Assuming you were in the 20 percent tax bracket, that would have meant paying capital gain taxes of $30,000.

This is not an easy decision to be made, and I often advise my clients to consult their financial adviser to discuss their overall financial picture, and also to discuss it with their heirs. Call your Realtor also to find out how much your home is worth in today’s market so that you can make an educated decision,

Please note that if you are married and own your home as community property, when the first spouse dies, the basis is stepped up. However, if the home is not held as community property, only the dead spouse’s half of the home gets stepped up.

 

In conclusion, let me add that we need to keep in mind that because we are talking about taxes here, there will be exceptions, carve-outs and exceptions to the carve-outs issued in I.R.S. private letter rulings and whatnot. I recommend you consult a tax professional, whether or not you fall into any of the following categories which will complicate things even further: widows or widowers, divorcees, newly remarried couples who already have homes, members of the military, people who have moved for job transfers, nursing home residents who have kept the homes they used to live in, people who sold a home before 1997 and rolled their capital gain over into the home they live in now and people who rebuilt after a fire, flood or other similar event.

Check with your accountant also if you have incurred a capital loss in the past (from the sale of assets, including stocks) as you may be able to offset that loss against the gain from the sale of your home.

The information contained in this article is believed to be accurate but should not be considered as tax advice, as every person’s individual tax situation is different. You should consult a qualified tax accountant or CPA before acting on any of the information included herein.

If you are considering selling, let’s strategize on how to prepare and price your home for maximum returns. If it’s time to buy, let me know so I can give you the inside info on each neighborhood that may be right for you. In the meantime, have a wonderful summer.

Other helpful Real Estate Tax Related Resources/Articles

IRS Real Estate Tax Guide

Real Estate Capital Gains and Your Home Sale by Bill Gassett

Capital Gains and Your Home Sale via Bankrate

Owner Financing: the Ultimate Guide to Seller Financing via FitSmallBusiness.com

This article was updated on October 30, 2017.


About the Author: The above article about Six Ways to Minimize Your Capital Gains Taxes When Selling Your Home was provided by Sylvie Zolezzi. I am an award winning, top producing Realtor specializing in luxury residential real estate in beautiful Marin County, just north of the Golden Gate Bridge.

I offer a wide range of innovative and comprehensive real estate solutions for buyers, sellers and investors, attracting clients who demand excellence—in marketing, negotiations, market knowledge—and a genuine concern for their needs. My association with Decker Bullock Sotheby’s International Realty allows me to provide a high-end luxury experience to all my clients at every single price point. It also empowers me to leverage the unique combination of Sotheby’s global resources, Decker Bullock Sotheby’s International Realty’s growing market share and local knowledge with my unmatched social media networks to provide highly personalized service and unmatched exposure to my clients’ properties locally and worldwide.

I would welcome the opportunity to show you how I consistently get outstanding Real Estate results for my clients. I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789. 

 

 


Marin County Real Estate Market Year End 2015 Report

Real estate markets are essentially determined by the balance – or lack thereof, as is often the case – between buyer demand and supply of homes to purchase. Underlying that dynamic are economic, political and demographic factors – some local, some not – such as population growth, unemployment and job creation, new household creations, new home construction, high-tech booms, consumer confidence, interest rates, affordability, oil prices, the global economy, IPOs, stock market movements, presidential elections and shenanigans in Congress, to name a few. Even environmental factors, such as droughts, unusually warm or cold weather and El Nino rains, can affect the market. These factors tend to all jostle for effect, ebbing and flowing.

Marin County Real Estate Market Year End 2015 Report

As unique as our Marin Market is, it is not impervious to many of these factors. It’s no secret that the Marin real estate market (and most markets in the Bay Area) have been suffering from imbalance between buyer demand and the supply of homes for sale as a result of a combination of several of these factors. But you might ask, when have we not had low inventory and high demand in Marin – it’s part of the fabric of our county. For decades, we have controlled new development and preserved our open space to maintain our quality of life. And Marin’s appeal remains as high as ever: it is more affordable than San Francisco and most of the Peninsula, the commute is great, our schools are top-notch, and our weather is the best, so many people want in and very few want out.

Marin County Real Estate Market Year End 2015 Report

In 2015, this imbalance between low supply and heavy demand affected buyers and sellers alike. We ended the year in December with higher sales of single family homes than in 2014 (158 in December 2015 vs. 137 in December 2014) despite a much reduced inventory. The average sales price was up 9 percent year over year, and 15 percent over the 2007 peak.

Marin County Real Estate Market Year End 2015 Report

The luxury end of the market saw an unprecedented level of activity with 45 homes sold for over $5 million, 7 of which selling for over $10 million and the sale of $47.5 million Belvedere mansion smashing all Marin records. To put these numbers in perspective, let’s compare sales by price point in the past five years:

Marin County Real Estate Market Year End 2015 Report

As prices have been increasing, there has a significant shift in the distribution of home sales by price point since 2011. In 2011, there were more than three times the number of sales in the below $1 million price range than in the $1-2 million range. In 2015, the number of sales between $1 million and $3 million represented the majority of the sales.

The two charts below illustrate the change in inventory and median and average price for single family homes during 2015.

 

Marin County Real Estate Market Year End 2015 Report
Marin County – Single Family Homes For Sale, Sold and Pended

 

Marin County Real Estate Market Year End 2015 Report
Marin County Single Family Homes – Median, Average and For Sale Prices

 

The condominium market in Marin (which accounted for 24% of sales this past year) acted very similarly to the single family home market. There were 705 condos sold in 2015 vs 687 in 2014, with the median condo price in 2014 at $495,000 vs $560,000 in 2015 (a 13% increase.)

For more details on market activity in 2015 and a break down of sales by city/town, please take a look at my Marin County 2015 Annual Market Report. .

Marin County Real Estate Market Year End 2015 Report
Locksley Hall sold for $47.5 million in 2015 – Photo By Vince Valdes

Let’s take a look at what drove our market throughout the year!

The Marin County housing market had a robust 2015. However, it was not an easy market to transaction in for anyone. Despite low mortgage rates, and positive job and income growth, affordability remained a key concern in the Bay Area and the housing supply was well below normal, posing challenges for both buyers and sellers looking for replacement properties they could afford.

Here are the most noteworthy takeaways:

  • The median price of a Marin single-family home passed the $1 million mark in 2015, increasing from $965,000 in December 2014 to $1,110,000 in December 2015, a 15 percent jump.
  • Bay Area Market Update January 2014 - www.YourPieceofMarin.com by Sylvie ZolezziDemand was high as the San Francisco Bay Area economy continued thriving and creating jobs. As rents kept increasing all over the Bay Area, buying became more attractive, especially in the North and East Bays where home prices remained more affordable than in San Francisco.
  • The increased demand was not met by an increase in inventory, on the contrary. Inventory remained excruciatingly low, challenging both buyers and sellers looking to move-up or downsize.
  • Despite the high demand, sales (all property types) remained essentially flat at 2,484 homes sold in 2015 compared to 2,530 in 2014, as a result of our limited inventory.
  • The price increase was driven by the imbalance between supply and demand, resulting in multiple offers on well priced and presented homes.
  • First time buyers found themselves competing with all-cash buyers and investors.
  • Despite the competitive market, correct pricing, good condition and great presentation were key in generating competing offers and driving up the final sale value.
  • Interest rates remained historically low and are still below 4 percent, despite the Fed increase in December (the first increase since 2008.)
  • Financial markets turmoils caused a downturn in the latter part of the year from the peak in the summer months due to a combination of factors including the economic slowdown in China, the U.S. monetary policy normalization and the collapse in energy and other commodity prices.
  • The annual household formation more than doubled year over year in 2015, jumping from 0.7 million in 2014 to 1.7 million in 2015.
  • Finally, you may have heard on the news of the effect of the roll out in October of the TILA-RESPA Integrated Disclosure (TRID) or Know Before You Owe Federal consumer protection rule on  real estate sales nationwide in November. The learning curve for mortgage professionals and title companies resulted in longer escrows which pushed a lot of the November sales into December in many markets but there should no longer be any delays going forward.

What can we expect in 2016?

  • Search traffic for “real estate” in January (based on data from Realtor.com) has grown on a year-over-year basis slightly higher than in 2015, which points to continued strong demand.
  • Most industry experts agree that housing shortage is in the cards again for 2016.
  • The housing shortage is expected to continue to pose challenges that could further restrain home sales in 2016.bigstock-Real-Estate-Mortgage-Loan-Docu-4240466[1] (640x427)
  • According to Leslie Appleton Young, chief economist for the California Association of Realtors, the Fed will likely increase rates gradually in 2016 and 2017. The Fed’s actions will be “data determined,” balancing the risk of increasing rates too fast and bringing economic growth to a halt against the risk of increasing rates too slowly and having zero leverage when the next downturn comes around. 
  • First time buyer activity should continue increasing: First-time buyers in all of 2015 represented an average of 30%, up from 29% in both 2014 and 2013. According to Lawrence Yun, chief economist for the National Association of Realtors, “First-time buyers were for the most part held back once again in 2015 by rising rents and home prices, competition from vacation and investment buyers and supply shortages. While these headwinds show little signs of abating, the cumulative effect of strong job growth in recent years and young renters’ overwhelming interest to own a home should lead to a modest uptick in first-time buyer activity in 2016.”
  • In the Bay Area, the low supply/high demand ratio driven by our strong economy–especially the tech and scientific services–should help sustain the pace for a healthy 2016.
  • If El Nino rainy weather drags on into the spring, we may see a delay in new listings coming on the market as sellers typically wait for better weather to put their home on the market.

Where is the inventory?

You may be wondering why we have such a low inventory of homes for sale in Marin (and other parts of the country.)  As mentioned above, it is the result of a combination of different factors affecting repeat or trade up buyers including affordability challenges among other reasons:

  • They currently enjoy rock bottom mortgage rates, and they sometimes cannot qualify for a new mortgage today.
  • They bought during the downturn when prices were much lower and could not afford their current home today, even less a bigger one.
  • They are enjoying low property taxes, thanks to Proposition 13.
  • The foreclosure/short sale pipeline of more affordable homes is dry.
  • It’s a catch twenty two: they have no motivation to sell because they have nowhere to go they can afford.
  • Investors are renting (wouldn’t you with rents as high as they are?) instead of flipping.
  • From a pure demographic standpoint, the trade-up buyer pool in our population is low.

I hope you enjoyed reading this report and understand the dynamics of our market a little better. Check my blog often as I write a monthly report.

If you are considering selling, let’s meet to discuss how the numbers above have affected your neighborhood’s values and strategize on how to prepare and price your home for maximum returns. If it’s time to buy, let me know so I can give you the inside scoop on each neighborhood that may be right for you. 



About the Author: The above Marin County Real Estate Market Year End 2015 Report was provided by Sylvie Zolezzi. I am an award winning, top producing Realtor specializing in luxury residential real estate in beautiful Marin County, just north of the Golden Gate Bridge.

I offer a wide range of innovative and comprehensive real estate solutions for buyers, sellers and investors, attracting clients who demand excellence—in marketing, negotiations, market knowledge—and a genuine concern for their needs. My association with Decker Bullock Sotheby’s International Realty allows me to provide a high-end luxury experience to all my clients at every single price point. It also empowers me to leverage the unique combination of Sotheby’s global resources, Decker Bullock Sotheby’s International Realty’s growing market share and local knowledge with my unmatched social media networks to provide highly personalized service and unmatched exposure to my clients’ properties locally and worldwide.

I would welcome the opportunity to show you how I consistently get outstanding Real Estate results for my clients. I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789.