Despite the worst wildfire season so early in the season, second home real estate markets have seen an unprecedented year in terms of growth. The Sonoma County is booming with Bay Area/SF/Silicon Valley workers snatching up properties to use as a second home/getaway or a home with more space. Prior to the pandemic, most buyers were local or from other states who came to visit wine country and fell in love with the area.
With so much demand, inventory is low and the unending destruction of the last few years of wildfires has made it hard to keep up with demand. The continuing inventory problem has been exacerbated with the high demand.
The number of sales in the county was up 27% from June through August 2020 vs. the same period in 2019, and the percentage of properties that went off the market within two weeks was up 8% in the same period in 2020 versus 2019. However, active listings were down an average of 11% from May to August 2020 compared to 2019. For local agents, it’s become a real challenge to help buyers find homes. It’s not uncommon for a home to hit the market and be in escrow within 24 hours. The heavy demand and low inventory has made it almost a requirement for buyers to make all-cash, over asking-price offers.
Most buyers from the Bay Area are not sure whether they’ll keep the home as a second home/getaway or weekend home, and assume they’ll be able to put their house on short-term rental sites once the pandemic is over. With many of these buyers entering the second home market for the first time, they may be surprised at the strict vacation rental market restrictions put on a large portion of the county.
As buyers from the Bay Area/SF continue to reassess their long-term needs, the demand could slow down with buyers targeting other areas such as coastal Bodega Bay. For now, the housing market is unusually brisk at a time when the market would typically start slowing down.