One of the most important parts of being a real estate agent is being acutely aware of the housing market and economic trends that are currently happening and what is on the horizon. In gathering that information, you not only consider what is going on locally, but also nationally. Locally trends can be isolated due to the current housing status, like in the case of Santa Rosa and the fire victims of 2017. Nationally however, you will see a common trend that started in mid 2018 in specific areas and is now making its way to bigger areas, like Orange County, CA., Los Angeles and San Francisco, the big boys of the California market.
Sonoma County Housing Market
Sonoma County, especially Santa Rosa has bucked the typical real estate trends these past couple of years due to the loss of housing from the fires of 2017. As the two year mark approaches, these insurance payments will stop. Homeowners have been divided as to what they have all chosen to do after this event.
Some homeowners immediately purchased another home after the fires, while others sold their lots and moved away. There were homeowners that bought another house and still own their lot and are rebuilding. Lastly, we have seen an influx of spec builders from all over California purchase lots in both Fountaingrove and Coffey Park and construct beautiful new homes, changing the landscape….which inherently breathes new life into these areas.
One thing is for sure, nobody knows exactly the number of people still looking, have already bought, chose to move away or already sold their lot or are rebuilding. That’s why speculating the Sonoma County market individually is so difficult to read….there is no concrete information about what all the fire victims chose to do.
Housing Market Nationally
The housing market nationally has been shifting since Spring 2018. The lowering of the interest rates has kept the sales steady in 2019, but slightly lower than 2018. The market has been in a balanced state for some months now. Listings for the past several years have many times gone into contract within the first 30 days. We will still see that on many homes here in Sonoma County that are priced right. If homes are priced above what the market dictates, they will not sell quickly, especially with the additional competition on the market.
This scenario usually leads to price reductions, which we are seeing more of as sellers are having to adjust to this market change. This is not bad news or a bad trend. It just means that the market is adjusting, with buyers leading this wave. There is definitely the supply, but they bring the demand.
What Sellers Should Do
Any changes in the housing market requires an adjustment to the mindset of sellers. This slight shift in the housing market is a good thing to be aware of. It gives you the correct information to base your listing price on, so you don’t end up being on the market for 6 months to a year, or worse yet, not selling your home.
I recently listened to Tim Smith with Coldwell Banker in Newport Beach, CA, who leads his team ” The Smith Group” nationally for sales in Orange County. He recently posted a video on Instagram about the housing shift and what sellers should do. He talked about the much longer listing times and his advice to people wanting to sell their home was simple….“Lead the trend, don’t follow it” and I couldn’t agree more. Price it right for today’s market and you will definitely be successful in selling your home!