In The News

Jeff Schween for The Press Democrat – Real Estate….There Is No Substitute

Real Estate….There Is No Substitute

Porsche coined the slogan decades ago to epitomize the experience of owning and driving their iconic creations. They found it brought about emotional reactions, imagination and old-time memories that drew buyers to its’ brand while inevitably creating a cult following of sorts for those that could acquire one as for those that could only dream of it. This phrase has survived the decades and become readily recognizable around the globe. Which begs to question, shouldn’t this even more uniformly apply to owning real estate?

According to BAREIS MLS, the entire Santa Rosa marketplace continues to experience greater compression in its’ real estate activities than even last year – meaning fewer new listings yet still a greater percentage volume of sales. As October closed there were exactly 224 single-family homes remaining for sale in the city and its environs. The municipality welcomed 131 new listings to the market during the month – 25 percent less than this same time last year – while 193 units garnered accepted offers – comparatively just two percent fewer than in 2015. Buyers acquired new keys on another 153 homes by the end of the month, leaving the city with a months’ supply of inventory (MSI) of 1.5.

MSI is the metric that indicates the number of months it would take to sell the current inventory at the current rate of sales. An MSI ranging from 4.0 to 6.0 is generally indicative of a balanced market, with lower numbers increasingly favoring sellers and vice versa.

Getting down to the underlying specifics, Northeast Santa Rosa saw the introduction of 42 new homes in October – a staggering 31 percent fewer than the same time last year – leaving an available supply of 103 units for sale by months end. Buyers climbed into contract on 58 new purchase agreements – 16 percent below last October – while sellers were able to conclude sales on an additional 55 properties during the month – holding the MSI steady at 1.9.

Comparatively in Southeast Santa Rosa, there were merely 38 single-family homes available as the month wrapped up – 38 percent less than a year ago. This submarket experienced the debut of 26 new listings during the month – uncharacteristic with regards to other regions of Sonoma County as this was 30 percent more than the prior October. Buyers garnered accepted offers on 38 more properties while the depleted overall supply in this region allowed sellers to close sales on only 25 units during the month – a predictable 24 percent fewer than in 2015 – leaving this submarket with an MSI of 1.5.

Oakmont felt cataclysmic blows to its market as sellers continued to show up in fewer numbers than buyers. The typical availability of homes to consider for the month was off 53 percent from the prior year – showcased by the mere 14 unit’s available leading into November. Buyers chased down 17 new deals this month as sellers confidently closed 16 transactions while only 11 new properties arrived on the scene to replenish what is already a meager supply. The data from Oakmont indicates an MSI of 0.9 – Santa Rosa’s most challenging sector for buyers at the moment.

Northwest Santa Rosa exhibited continued pressure on the front lines of real estate in October. Sellers in this region brought 35 new properties to market – 27 percent fewer than 2015 – as buyers promptly jumped into contract on 54 new deals. This submarket was left with 52 homes to open November after seeing seller’s complete sales on 42 different properties steadying the MSI at 1.2 – still leaving numerous buyers stranded without their dream accomplished.

Southwest Santa Rosa seller’s had continued success bringing 17 new homes to the market as buyers climbed over one another to get into contract on 26 deals – more than at any time over the preceding 18 months. This area saw another 15 units complete the formal transfer of ownership and roll into November with only 17 homes available to those in pursuit of their new place – effectively keeping exuberant pressure on this market for coming price moves with an MSI of 1.1.

As much as many of you would like to have a Porsche parked in your garage and under your authority the numbers suggest strongly that real estate has no substitute.

By Jeff Schween, of Pacific Union International’s Santa Rosa office.