Sonoma County home prices hit 8-year high

Sonoma County home prices rose in April to their highest level in more than eight years as buyers vied for a limited supply of properties on the market.

The median sales price for a single-family home jumped 15 percent from a year earlier to $541,000, according to The Press Democrat’s monthly housing report compiled by Pacific Union International Vice President Rick Laws. The median hasn’t been this high since January 2007, when it stood at $545,000.

The median price is now within 13 percent of its record high of $619,000 set in August 2005. Put another way, the median has increased 77 percent from its low point of $305,000 in February 2009, during some of the bleakest days of the housing crisis

Agents and brokers said they will be watching this year to see how close the median price comes to its former record.

“Get back to an all-time peak and everybody’s legs start shaking,” said Gerrett Snedaker, senior vice president for the North Bay division of Wine Country Group by Better Homes and Gardens.

Buyers last month purchased 435 single-family homes in the county, an increase of nearly 21 percent from a year earlier. But due to sluggish sales in January and February, the total sales for 2015 still lag those for the same period last year by 1 percent.

Buyers continue to compete for a limited number of homes, agents said. The county ended April with fewer than 750 homes for sale, amounting to less than a two-month supply at the current pace of sales. Such a tight supply is generally considered to constitute a sellers’ market.

Last month, 600 new listings came to market. But it didn’t result in much of an increase in inventory, mainly because 530 homes went off the market with signed contracts between buyers and sellers. While some of those agreements typically fall through, most are expected to become final in May and June.

“Any time something gets released, you’ve got this voracious appetite for it,” Jeff Schween, an agent with Pacific Union/Christie’s International in Santa Rosa, said of the new listings.

Agents and brokers said a number of factors, including a better economy, are contributing to the demand.

“Rents are really high and (interest) rates are low and there is no construction” of new homes, said Maria Lounibos, a broker with Sotheby’s International Realty in Sonoma. “When there’s no construction, what does that do?”

The demand is also partly attributed to buyers from San Francisco and the South Bay seeking properties.

“I think the second-home market remains healthy in Wine Country,” Snedaker said.

Increases in the median price often involve both a rise in home values and a shift in the types of homes being sold. For example, a jump in sales of million-dollar homes will cause the median to increase.

This year, the number of homes sold above $600,000 has increased 16 percent from the same period in 2014. During that time, the number of homes selling below $400,000 has declined 36 percent. However, agents said the drop in the number of lower-priced homes may be largely due to the appreciation of such properties.

When buyers tell Schween that they would like to find a single-family home for under $400,000, his response is: “Well, where? Maybe southwest Santa Rosa. Maybe Lake County.”

The past decade saw home prices rise to new highs before crashing amid a flood of foreclosures and short sales. The latter refers to homes sold for less than what is owed on the mortgage.

Among the communities hard hit with economically distressed properties was Windsor. But this year the town is outpacing much of the county for increases in median prices.

For the first four months of the year, Windsor’s median price increased 15 percent from a year earlier to $529,000. In comparison, the county’s year-to-date median rose 8 percent to $505,000.

Healdsburg and the Sonoma Coast also have witnessed large year-to-date jumps in the median prices of 16 percent and 17 percent respectively. But agents said Windsor was notable for how far it has bounced back.

Belinda Andrews, a broker associate with Century 21 in Santa Rosa, represented the sellers for a number of Windsor’s short sales, and she found it striking how the town’s housing market has changed over the past four or five years.

During the downturn, “we couldn’t get rid of the houses,” Andrews recalled. “Now people are just begging for them.”

In Windsor, the number of sold houses and condominiums for three straight months has outpaced the number of homes available for sale when each of those months began, Snedaker said.

For now, sales there are rising and inventory is falling, he said, but “you can’t keep that up for very long.”

You can reach Staff Writer?Robert Digitale at 521-5285 or robert.digitale@pressdemocrat.com. On Twitter @rdigit