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Pacific Union Quarterly Report: Q4 2013

Inventory steadily declined across the Bay Area in 2013’s final quarter, further exasperating the situation for hopeful buyers who didn’t act earlier in the year.

December inventory hit yearly lows in every Bay Area region in which Pacific Union operates except for the East Bay and Sonoma Valley. In the Tahoe/Truckee area, inventory for both single-family homes and condos expanded as the fourth quarter advanced, with many buyers having locked in properties in advance of the ski season.

Prices remained healthy throughout the quarter, though in most markets they were down somewhat from their yearly peaks. The exceptions to this trend were our Silicon Valley region, where the median price hit a high of $2.32 million, and Tahoe/Truckee, where the median price for a single-family home topped $600,000 for the first time in the past 12 months.

Pacific Union’s fourth-quarter report is full of data and regional summaries that provide a comprehensive 2013 retrospective and point to a very promising year to come.

 


SONOMA COUNTY

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After years of downturn followed by measured recovery, our Sonoma County real estate markets are returning to normal. In the fourth quarter, that meant a more traditional seasonal slowdown as the dwindling supply of distressed-property sales gave way to more-stable equity sales. The market deceleration also reflected a significant shortage of available homes for sale in the face of continued strong demand from buyers.

The median sales price continued to rise in the fourth quarter, a reflection of the drop-off in foreclosures and other distressed sales, as well as solid appreciation in many price ranges. The quarter saw strong growth in sales of homes priced from $1 million to $2 million, plus significant increases for properties priced from $500,000 to $900,000. The second-home market also saw healthy sales, particularly in Healdsburg and other Wine Country destinations. Investor activity declined as prices rose, reducing the frequency of multiple offers.

Looking Forward: We expect the tight inventory levels of the fourth quarter to loosen by springtime, and buyers will be waiting. Less certain are the effect of rising mortgage rates and potential changes that would make loan regulations more restrictive. Future buyers are encouraged to get off the fence and secure financing sooner rather than later.

To read about other Bay Area counties, Click Here.

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