In 2012, Susan Rapp saw firsthand how patience has its rewards.
Rapp, a Petaluma resident, said she endured eight “grueling” months waiting for a bank's permission to purchase a four-bedroom, custom-built home across town. She locked in the price for the short sale in January and then wondered what would happen with home prices.
By the time escrow closed in September, values had risen. As a result, Rapp and her husband last fall sold their five-bedroom, east Petaluma tract home for nearly $800,000 — more than they had expected and more than they had paid for the 3,250-square-foot home on the city's desired west side.
“I was one of the fortunate ones who was able to buy low and sell higher,” said Rapp, an attorney in San Francisco. She said the new house, reminiscent of her childhood home in San Jose, likely would have cost more than she could have afforded during the housing bubble.
Last year marked an upturn in Sonoma County's housing market.
Five years ago prices took a historic plunge, followed by a deluge of distressed properties and a lack of buyers for mid-level and million-dollar homes. In the dark days of 2009, three out of four sales were foreclosures or short sales, where the home is purchased for less than the amount owed on the mortgage.
But last year, the market experienced a sharp uptick in home sales above $500,000, a decline in distressed sales, a shortage of inventory, low mortgage rates and a rise in prices.
“The market's come off the bottom,” said Cynthia Wood, a broker associate with Sotheby's International Realty in Sonoma.
Home prices hit the floor in Sonoma County in 2011, when the annual median price fell to $325,000, down 45 percent from the 2005 peak of $595,000.
Last year, the median price rose 8 percent to $350,000, according to The Press Democrat's monthly housing report compiled by Pacific Union International Vice President Rick Laws.