Sonoma County home values will rise a mere 1.5 percent this year, real estate data firm Zillow predicted Thursday, and that means new buyers will have to stay in homes longer in order to justify purchasing rather than renting a place to live.
The estimated slowdown in appreciation here will require 2017 buyers to stay in their homes nearly a year longer in order to reach the day when Zillow says buying becomes more cost effective than renting.
For the county, the so-called “break even” point is four years and five months. That’s 11 months longer than a year earlier.
Zillow chief economist Svenja Gudell said in a statement that it was helpful for buyers “to understand that as home value appreciation moderates, it will take them longer to break even than in past years.”
He noted that buyers in San Jose would have to stay in a home for five years and two months “to offset the high upfront costs necessary to make that purchase.” That’s nearly two years longer than a year ago.
For San Francisco, the break even point is four years and six months, 17 months longer than a year earlier.
For the nation, the break even point is 23 months, compared to 22 months a year ago.
On the question of appreciation, such a small increase in county home values in 2017 would amount to a marked change after five years of sharply rising prices.
A different data company, Corelogic, last month estimated that county home values had risen 7.6 percent in November compared to a year earlier, the most recent data available.
In a different measure, the county’s median single-family home price increased 9.4 percent to $580,000 last year compared to 2015, according to the Press Democrat’s monthly housing report.
In total, the median price has climbed 78.5 percent in five years.
You can reach Staff Writer Robert Digitale at 707-521-5285 or firstname.lastname@example.org. On Twitter @rdigit
Ready to buy? Check out this list of the 10 least expensive homes available now in Sonoma County here.