Lack of inventory constrains Sonoma County home sales

Sonoma County’s housing market is off to its slowest start in seven years.

Buyers in January purchased 224 single-family homes, according to The Press Democrat’s monthly housing report compiled by Pacific Union International Vice President Rick Laws. That was the lowest number for the month since 2008, when prices were plunging amid an unprecedented housing market crash.

In another sign of slower times, the county had only 301 new sale listings for single-family homes in January. That was the lowest number for the month since at least 2009, when the newspaper began tracking such data.

The market has plenty of buyers, but not enough sellers, agents and brokers said.

Last month ended with fewer than 500 single-family homes for sale, which seems near a record low, Laws said. Five years ago, the January inventory was more than double that number.

Inventory has declined along with the number of foreclosures and short sales on the market. But agents said the situation is compounded by financial constraints on some homeowners and by the reluctance of potential sellers to part with their homes without knowing that they can find suitable replacements.

Even though home prices have been rising for three years, a significant number of homeowners still don’t have enough equity for an adequate down payment on a new home, said John Duran, a broker associate with Coldwell Banker in Santa Rosa.

“And even if they have equity, there’s nothing to choose from and they’re not going to sell their place if they have nowhere to go,” Duran said.

More sellers eventually will put their homes on the market, he said, but “it’s just going to take time. It’s not going to happen overnight.”

January ended with the county’s median home price at $478,000, a decrease of 7 percent from December but still nearly 4 percent higher than a year earlier.

Housing values soared a decade ago as the county’s median price hit a record $619,000 in August 2005. But a few years later prices crashed amid a historic housing crisis. The median price began a sharp decline in 2007 and fell to a low of $305,000 in February 2009.

This year, the challenge for agents will be to show potential sellers the ways that they would be able to buy new properties if they put their current homes on the market, Laws said .

“We have to get buyers and sellers to work together,” he said.

Some sales will happen when sellers accept offers contingent upon buyers being able to put their own homes under contract, he said. And some deals will take place when sellers are allowed to keep living at their properties for a few months after escrow closes in order to provide them time to buy new homes.

As well, some sales will involve a series of transactions that take place in tandem, said Rita Alonso, president of the Santa Rosa chapter of the North Bay Association of Realtors.

Alonso, an agent with Keller Williams in Santa Rosa, said last summer she was involved in a transaction where an owner sold a place in Petaluma and bought a new Penngrove home, while the Penngrove seller bought a new place in Sebastopol. If any sale had fallen through, all three deals might have been scuttled.

“It’s all the domino effect,” Alonso said. Four different agents coordinated the inspections and escrows, she said, and all three transactions were successfully completed.

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