Is there any hope for a hard-working parent seeking to buy a Petaluma home in the roller coaster that is today's real estate market? To Kathleen "Kat" Bloom, a pharmacy technician at Kaiser and mother of two, the answer seemed to be no.
After making offers on property after property, only to be outbid by people offering all cash, or seeing multiple bids drive the price out of her reach, she was discouraged, as many home buyers now find themselves in a market that seems to have shifted from favoring buyers to sellers overnight.
"I'd see the same people at every new listing," said Bloom. "Everyone was bidding against each other for the same house."
Bloom, who is from Petaluma, wanted to remain near her family, but had to face the prospect of moving elsewhere.
Her Realtor, Trish Iribarne, an agent with Coldwell Banker, said Bloom was doing everything right, but that, "It is so competitive, especially in the bracket that Kat is in — that of a first-time buyer. You can be qualified, present personal letters or recommendations, make an offer over the asking price and still lose out to cash buyers."
Sean Payne, a Realtor with Frank Howard Allen and president of the Petaluma Chapter of Realtors, confirms that the market conditions have shifted.
"The market has picked up in favor of the seller, and the change was not gradual," said Payne. "It happened in just over a year.
"Currently we have only 61 homes active in Petaluma," says Payne. "Many potential sellers are concerned that if they sell, they won't find anything to buy." This tight inventory of available housing, historically low interest rates and a recovering economy in which job growth is continuing, has released a pent-up demand for home ownership. With more buyers than properties, Petaluma is experiencing a resurgence of the multiple offers and bids over the asking price not seen since the housing bubble burst in 2007.
Foreclosures and short sales have declined, though they still comprise one in five properties sold in Sonoma County. Contractors, corporations and "flippers" are buying up distressed homes and turning them around quickly for a profit.
Some investors take an uninhabitable property and return it to a livable state, benefiting the buyers who often would not have the means or resources to both buy and renovate. Other companies snap up a foreclosure, then simply slap on a coat of paint, install cheap carpeting and appliances and put it back on the market at a much higher price.
Jeffrey Ventrella, a software engineer who has lived at 335 Kentucky St. for 13 years, watched as the home next door went through a series of owners and renters. "A nice couple with two kids bought it in the real estate heyday, and when the market tanked, they lost it to the bank."
The Craftsman-style, historic home sat vacant for three years, deteriorating and broken into by transients.
"Of course our property values went down as a result," he said. Eventually, the home was bought in January, 2013 in a cash sale for $326,000 by a developer who renovated the property and sold it in May for $618,000.
"Petaluma is one of the more affordable and desirable places to live in the Bay Area and a gateway to the wine country," contends Todd Mendoza, manager of the Petaluma office of Coldwell Banker Northern California.