Sonoma County housing market softens in 2019 after post-fire surge the year before
James and Ashley Harvey made a bid to buy a 4-?bedroom, 21/2-bath house near Windsor’s Foothill Regional Park in October shortly before the Kincade fire rushed over the Mayacamas Mountains, swept across Alexander Valley and came within a few hundred yards of their “dream home.”
Even worse, the Harveys lived in a much smaller home in the same Windsor neighborhood. They wondered if the county’s latest destructive wildfire would ruin their plans to sell their existing home to help pay for the new one.
“We put an offer in right before the fire started,” James Harvey said this week. “I ordered an appraisal while I was looking at the flames off in the distance.”
As firefighters waged a valiant stand against Kincade, preventing it from devouring hundreds of homes in northeast Windsor and other populated areas, local real estate experts wondered whether the second inferno in two years to reach the Sonoma County flatlands would again upend the county housing market.
It didn’t. Windsor, Healdsburg and neighborhoods in and near Santa Rosa were saved this time from the flames.
In Windsor, Kincade, for the most part, was stopped at the Foothill park boundary. The Harveys bought their dream home and Windsor’s housing market ended 2019 with a 16% increase in the average single-family home sale price of $702,100, according to The Press Democrat’s latest monthly housing report, compiled by Rick Laws of Compass real estate brokerage in Santa Rosa.
The end-of-year report for Sonoma County, which tallies home sales, monthly median prices and inventory during the 12 months, shows how the local housing market performed throughout 2019.
Local real estate experts say the market continues to regain its footing after the turmoil caused by the 2017 North Bay wildfires, which destroyed about 5,300 houses in the county. After those October fires, prices inflated in 2018 as the destruction strongly stoked demand for homes. Last year, the housing market cooled and balanced itself.
Countywide, housing sales activity finished 2019 strong and that helped make up for a slow start, Laws said. The 4,441 total homes sold were only 1% fewer than the 4,453 sold in 2018.
The county’s median single-family home sale price of $635,000 in December was 2% less than the median of $650,000 at the beginning of 2019. The county’s average median sale price for the entire year was $650,000 compared with $665,000 in 2018.
Real estate agent David Rendino, who co-owns Re/Max Marketplace in Cotati with his wife, Erika, said the housing market in some communities experienced significant “ups and downs” last year before finishing on a positive note. Windsor was a prime example, he said.
“For most of the year, it was hairy in Windsor,” he said. “We were having to make reductions on properties and they were sitting for a while.”
Across the county last year, Laws said east Petaluma saw the biggest increase in the number of homes sold: 321 vs. 271 in 2018, an 18.5% jump. On the other hand, Oakmont community in Santa Rosa, saw the biggest decrease, 16.5%, with 152 homes sold in 2019 after 182 were sold the year before.
Changes in the annual median sales price were less dramatic last year, Laws said. With the exception of Oakmont, where the median dropped from $700,000 in 2018 to $613,750 in 2019, fluctuations in median price in other cities and towns in the county were under 10%.
Laws and other real estate experts said Oakmont’s residential real estate slump was likely caused by the financial woes of the community’s Oakmont Golf Club. But he said Oakmont’s housing market should recover this year with the sale of the golf club to members of Oakmont Village Association.
Meanwhile, James Harvey, 35, said he first discovered Windsor’s Foothills neighborhood eight years ago, when he worked for 1-800-GOT-JUNK and did a job there. He grew up in San Mateo, where he often played in open spaces that had lagoons where he fished. He wanted something similar for his kids.
In 2014, Harvey bought the 1-800-GOT-JUNK franchise where he had worked, and two years later, he and Ashley bought a 1,000-square-foot home - the smallest floor plan - in the Foothills neighborhood. When Ashley Harvey became pregnant with their third child, they started looking for a bigger home.
“We were able to find our dream house in our dream neighborhood,” he said, adding that he paid $699,000 for their new 2,200-square-foot home.
The house required a good deal of work because of deferred maintenance. They’re remodeling the first-floor kitchen, laundry room and bathroom, and painting and redoing the floors throughout the house.
Doug Solwick, a broker associate with Coldwell Banker in Santa Rosa, said despite a fire, intentional PG&E power shut-offs and neighborhood issues like the Oakmont golf course, 2019 was a “good, solid year.”
Solwick said 2019 got off to a slow start, partly due to the rain and historic Russian River flooding in February, but the second half was fairly strong.
“It became a more balanced market toward the end of the year,” he said. And he predicted that barring any unforeseen economic trouble, it would continue that way.
Looking ahead, low mortgage rates, which has spurred home sales, are likely to stay low because it’s an election year, real estate experts say.
Lisa Sheppard, a real estate agent with Sotheby’s International Realty in Sonoma, said the local market for high-priced homes has softened.
Sheppard who specializes in pricey estates and vineyard and winery sales, said the average price paid countywide in 2018 for homes priced above $1 million was $1.65 million. Last year, it was $1.58 million.
In 2018, similar data showed there was a total of 770 such homes sold for $1.27 billion overall. Last year, there were 664 homes priced at $1 million or more sold for a total value of $1.05 billion.
“What that tells me is, we’ve had a decline in the market,” she said. But she noted that in 2018 there was a rush to buy homes, especially among those people who could afford to buy at higher prices.
Sheppard said 2019 was actually a “more normalized” market even for the wealthy buyer. She predicted there would be more activity in the high end of the housing market this year.
“I’m already seeing upper-end listings in Healdsburg, Sebastopol and Sonoma going into contract right out the gate,” she said. “These are listings that may have been sitting a few months over the holidays and are now going into contract.”
You can reach Staff Writer Martin Espinoza at 707-521-5213 or firstname.lastname@example.org. On Twitter @pressreno.