May Sonoma County home sales at highest level in 8 years
Published: Friday, June 14, 2013 at 8:17 a.m.
Last Modified: Friday, June 14, 2013 at 8:17 a.m.
Strong May home sales in Sonoma County remained almost identical in number to a year ago, but a closer look shows how much the market has changed in 12 months.
Financially distressed properties have markedly declined in number, regular “equity” sales have increased, prices have jumped and inventory has fallen to its lowest level in 13 years.
“There's a slew of buyers, and there's nothing for them out there,” said Mike Kelly, an agent with Keller Williams in Santa Rosa.
Buyers purchased 505 single-family homes last month, according to The Press Democrat's monthly housing report compiled by Pacific Union International Vice President Rick Laws. The total was just one more than the number of homes sold in May 2012 and amounted to the biggest number for the month since 2005, when 558 homes were sold.
The median price last month declined 2.4 percent from April to $425,000. Despite the dip, the median remained 29 percent higher than a year earlier, when it was $329,500.
Today's housing market includes plenty of uncertainty about the current and future value of properties, said Eileen Morelli, the operating principal and broker for Keller Williams' three offices in Sonoma County.
“The buyers feel like they're paying too much. And the sellers feel like it's not the best time to sell,” said Morelli.
Even though prices have risen considerably in the last year, many potential sellers question whether they might earn more by waiting to put their homes on the market, she said.
While the sales result is similar to last year, a drop in the number of distressed properties is having a marked effect on the median price and inventory.
A year ago, two out of every five homes sold were foreclosure resales or short sales, the latter a transaction where the price is less than the amount owed on the mortgage. By last month that rate had fallen to one in five.
The difference amounted to roughly 110 fewer distressed sales and a similar increase in sales of higher-priced homes whose owners have equity.
“It's significantly fewer distressed sales,” said Laws.
The shift in the mix is responsible for part of the rise in the median, or the midpoint, price for the month's sales. One indicator is that the median price for all sales increased 29 percent from May 2012, but the median for equity sales rose by a lesser amount, 18 percent.
Another indicator is that homes sold for less than $300,000 declined 65 percent in May from a year earlier. Meanwhile, homes sold for more than $500,000 rose 55 percent for the same period.
The number of available homes on the market continues to fall. Last month's inventory declined 41.9 percent from a year ago to 755 homes — the lowest level for May since 2000.
One reason is that new listings of distressed properties have declined 59 percent for the first five months of 2013, compared to a year earlier. A 20 percent jump in new listings of equity properties wasn't enough to make up the difference.
The housing market started out slower this winter than in 2012, Laws said. But sales have picked up this spring and should remain strong through summer.
“There's a pool of buyers out there circling that are just waiting for properties,” he said.
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