Sonoma County median home prices hit $600,000
Nine years after a historic crash and rebound, Sonoma County’s median single-family home price hit $600,000 in June.
Last month’s median price ended exactly at $600,000, according to The Press Democrat’s monthly housing report, compiled by Pacific Union International senior vice president Rick Laws.
The last time prices were at least that high was June 2007, when the median was $605,000. The very next month prices began a 20-month plunge, causing the median to be cut in half.
For local brokers, $600,000 represents a milestone. That is partly because the median price now sits just 3 percent below the county’s all-time high of $619,000 from August 2005.
“It’s incredible,” said Cary Bertolone, a co-owner of Bertolone Realty in Santa Rosa. “It just verifies that continued appreciation that we’ve seen.”
June’s price was nearly 10 percent higher than a year ago.
In the midst of a national housing crash, the county’s median price hit a bottom of $305,000 in February 2009. The local market spent the next two years in a purgatory of foreclosures, short sales and fearful owners who, at least on paper, had taken an unprecedented beating in their homes’ values.
But for the last four years, prices have steadily climbed. On an annual basis, the median price jumped 8 percent in 2012, 23 percent in 2013, 12 percent in 2014 and 9 percent last year. For the first six months of 2016, prices have increased nearly 10 percent from the same period a year earlier.
“It keeps shocking us that it keeps going up,” Bertolone said of home prices.
The ongoing appreciation has made him more reluctant to recommend that sellers price their homes exactly in line with comparable sales from recent months. Doing so, he said, can lead to a deluge of offers and a bidding war.
Instead, he said, he often recommends a buyer put the price slightly higher than the comparable sales but still at a level where it likely will get at least a few offers.
Last month, county buyers purchased 447 single-family homes, a decline of nearly 12 percent from a year earlier. To date this year, home sales have declined 2 percent from the same period in 2015.
Inventory improved slightly last month, Laws said, but still remains at less than a two-month supply at the current sales pace. The average days on market declined in June to about 45 days, the lowest amount in at least two years.
Despite this year’s jump in prices, brokers said they expect to see a moderation in future increases.
“All the forecasts that I read are for continued appreciation at a significantly slower rate,” Laws said.
Diana Blakeley, owner/broker at Wine Country Real Estate in Cloverdale, said she’s already seeing fewer multiple offers in some areas, despite a lack of available homes.
That seems partly because fewer people today can afford to purchase a home, she said. The California Association of Realtors estimates that only 26 percent of Sonoma County households could afford the median-priced home in the year’s first quarter, compared to 31 percent a year earlier. As prices rise, Blakeley said, “you eliminate a percentage of buyers.”
Blakeley said she would be surprised to see prices rise significantly in the coming months.
“Of course,” she said, “I’ve been surprised before.”