Char’s May 2023 Blog – Market Update

Charleen Price

1 year ago

Stay Up-To-Date on Industry Trends & Forecasts

Although it’s probably difficult to believe, things are getting better. Soon you will start to worry a little less, believe a little more, and find sunshine after even the darkest of storms.

Did You Know?

* Sales of previously owned homes declined 2.4% in March compared with February, according to the National Association of Realtors, 22% lower than March 2022, most likely due to a sharp jump in mortgage interest rates and limited inventory in areas, especially of more affordable entry level homes. (CNBC)
* The US median home price dropped 3.3% between March 2022 and March 2023, to $400,528. Pandemic-era boomtowns and pricy tech hubs fueled the drop, with prices in Boise, Idaho, plunging by 15.4% from a year earlier. (Boise saw 40% price escalations in 2021!) Austin followed, with prices falling 13.7% while Sacramento experienced the third-highest decline at 11.9%. Boise also experienced the largest drop in pending home sales in March, notching a 78.8% year-over-year decline. (INMAN)

Tools

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Trends & Forecasts

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Housing Market Predictions For 2023: Are Home Prices Finally Becoming Affordable?
Sonoma County Market May Flipbook

Market Update

Napa, Sonoma & Solano Counties: Home Price Map

This month, as we review the year-over-year comparisons of median list and sales prices and the number of listings, pending and closed sales, it is worth remembering that the first quarter of 2022 was approaching the peak of a historic 10-year boom. April of last year was still severely overheated, distorting many year-over-year comparisons. So, for this month, we thought we would also look at how things have changed since the beginning of the year through April.

The number of new listings coming on market continues to be low as many potential sellers are holding off from listing their homes due to the doubling of interest rates since early 2022. This constitutes a huge factor in market dynamics and is undoubtedly holding back sales activity. However, just since January of this year, the number of listings on the market has risen from 64 to 99 (54%) a sharp increase when compared to the April 2022 figure of 136 listings (-27%).

Sales too have begun to show improvement. In April of this year, the number of properties going into contract (29) was 87% higher than that of January (15) but still substantially lower than April of 2022 (47), a 38% decrease year-over-year.

All in all, the Sonoma Valley real estate market seems to be weathering the issues (interest rate increases, bank failures, recession talk) better than many areas. Multiple offers and over-asking-price offers are not uncommon and even the days on market have not fluctuated much since last year (41 days in 2023 vs. 39 days in April of ’22). As April is traditionally the beginning of the Spring selling season, we anticipate seeing even more favorable trends as we move into May, June and July.

Please note, all information is for single family residences in the Sonoma Valley as reported to BAREIS, the local multiple listing service through Broker Metrics.

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