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Pacific Union Quarterly Report: Q1 2014

SonomaCountyQ1_14

SONOMA COUNTY

First-quarter home sales started slowly in Pacific Union’s Sonoma County region, but as the inventory of available houses began to come to market, the velocity of sales picked up accordingly. By the end of March, a familiar pattern had emerged: Buyer demand outstripped the supply of homes, bidding wars were commonplace, and sales prices  rose significantly.

Homes at lower price points saw the strongest demand, but limited availability held back sales. A surplus of distressed properties supplied the lower end of the market in recent years, but that stream has since slowed to a trickle. With real estate activity moving upmarket, sales during the first quarter were strongest in the $400,000-to-$600,000 range and homes priced $1 million and higher. Sales velocity remained strong across all price points, however, and as soon as a well-priced property came on the market, it quickly went into escrow.

Looking Forward: Sonoma County’s real estate markets are entering a period of continued equity growth. Increased demand, and limited supply, over time will favor sellers. We expect buyer demand to remain exceptionally strong. Sellers, after more than a year of regaining equity, may find new incentives to put their homes on the market. We look forward to a busy spring and summer.

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