Marin and North Bay June Report

Paragon Real Estate Group
Paragon Real Estate Group

North Bay Real Estate: The 3rd Spring of the Recovery

June 2014 Report for Marin, Napa & Sonoma Counties

Though not seeing the overheated feeding frenzy of San Francisco and Silicon Valley (the two hottest housing markets in the country), all three North Bay counties continued to see strong demand and increasing home prices this past spring. The supply of homes for sale and mortgage interest rates remain low by any historical standard; the distressed property segment is rapidly disappearing, while high-end and second-homes sales increase. These are all good signs for our North Bay real estate markets.


Average Dollar per Square Foot Values

Average dollar per square foot is a very general statistic, almost always concealing a wide variety of values in the underlying home sales. Still, virtually every town and city we looked at saw increases since 2014 began, and this is certainly an indication of increasing real estate values.

Homes Selling With & Without Price Reductions

77% of the North Bay home sales in May sold relatively quickly without going through any price reductions and, in an indication of a hot market, averaged a sales price 2% above asking price. Listings that had to go through price drops spent months longer on the market before selling, and, of course, sold at a significant discount to the original list price. And then, even in a strong market, a fair number of listings expired, i.e. didn't sell at all, usually due to being perceived as overpriced.

Sales Over, Under & At Asking Price

This is a snapshot of sales prices to list prices for approximately 300 house sales closing at the end of May. 38% sold for more than 1% over the final asking price; 41% sold for more than 1% below asking price; and 21% sold within 1% of list price. A strong market characterized by healthy demand, but as a point of comparison, in San Francisco, 79% of May home sales sold for more than 1% over asking; a whopping 29% sold for 20% or more above asking price; only 8% sold under list price.

Median Home Sales Prices

All 3 counties have experienced similar trajectories in increasing home prices since the recovery began in earnest in early 2012. The spring selling season saw an additional jump in median sales price. According to the California Association of Realtors, Marin currently has the highest overall median home sales price of any county in the state. (One of the big differences in the SF market is that the majority of its sales are now condo/TIC sales instead of house sales.) The national median sales price is $202,000.

Distressed Home Sales

Marin and San Francisco were not hit as hard by distressed home sales as Sonoma and Napa during the downturn. Such sales virtually disappeared in Marin and SF in 2013, but now they're well on their way to disappearing in Sonoma and Napa as well. That is a chapter of real estate market history that will not be missed.

Months Supply of Inventory (MSI)

This important statistic of supply and demand fluctuates up and down according to the market and the season, but since 2012 the readings would typically be considered to signify either a seller's market or a very strong seller's market. Nationally, MSI is just under 6 months.

Please call or email if you have any questions or comments regarding these analyses.

Fluctuations in median sales prices and average dollar per square foot values are not unusual and these fluctuations can occur for other reasons besides changes in value, such as seasonality; inventory available to purchase; availability of financing; changes in buyer profile; and changes in the distressed and luxury segments. How these statistics apply to any particular property is unknown without a specific comparative market analysis. All data from sources deemed reliable, but may contain errors and is subject to revision.

(c) 2014 Paragon Real Estate Group
Paragon Real Estate Group
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