Wine Country real estate trends: June 2021

In mid-march 2020, the COVID-19 pandemic was declared and all parties were told to “Shelter in Place.” This basically shut down the residential real estate industry through the month of April 2020. The market then accelerated rapidly in May through October. Year over year statistical comparisons are therefore going to be skewed by these market aberrations created last year.

North Bay real estate trends for June 2021

For all of the areas covered by our Multiple Listing Service (BAREIS), which includes Lake, Marin, Mendocino, Napa, Solano and Sonoma counties, there is an inventory of 1,871 homes and condominiums for sale at the end of June. Inventory is 35 percent below that of a year ago (2,892) and it is 4 percent ahead of the inventory last month (1,804). At times, the inventory has exceeded 10,000 homes in the BAREIS region. There were 1,991 sales for the month of

June. This number is 5 percent below a year ago (2,096) and 5 percent ahead of the pace of last month (1,893).

On a national basis – there were 373,000 homes for sale at the end of June compared to 976,000 a year ago. A “healthy/balanced” market might have 1,000,000 homes and a “buyers’ market” would require about 1,500,000 available homes. Of all new listings, 25 percent sell “immediately” and 75 percent last a week or two. Of major concern is where the seller is intending to go and are they prepared for a quick sale. Prices normally peak in July and stay level through January. National forecasts predict increasing inventory and a slowing of price appreciation in the coming months and into 2022. We’ll see if this happens in Wine Country.

I have been following a data point I call the “Price Reduction Ratio” for the past six months, or so. Across the country, one might expect that 20 to 25 percent of the homes put into the MLS will have a price reduction before they eventually sell. For June 2021, of all closed homes in our Wine Country markets, the range was from 11 percent (Mendocino County) to 18 percent (Napa County). Conversely, the ratio of homes selling in excess of Original List Price ranged from 54 percent (Mendocino) to 60 percent (Sonoma County). It was 56 percent in Napa County. The average Price Reduction Ratio for all areas has gone from 29 percent in September 2020 to 14 percent in June of 2021 while the sales of homes in excess of Original List Price went from 33 percent to 57 percent over the same period.

Mendocino County: The inventory of homes and condominiums available in Mendocino County at the end of June stands at 145. This is 29 percent below the inventory in June 2020 (204) and it is 3 percent above the inventory last month (141). New sales (83) in Mendocino County in June were 15 percent below the pace of June 2020 (98) and they were 22 percent above the pace last month (68). There now is a 1.7 months supply of inventory in Mendocino County based on the existing sales pace. The average Days on Market for the 66 homes sold in Mendocino County in June is 54 days. For the purpose of our MLS (BAREIS) “Days on Market” represents the time from when the property is first listed in the MLS to the date the property goes into “pending” (all conditions removed) status. On average, it can take anywhere from 0 to 30 additional days for properties to close after going pending. The median price of the homes closed in June in Mendocino County was $570,000. This is 32 percent ahead of the median price in June 2020 ($433,000). Mendocino County homes are in high demand with prices rising quickly.

Ukiah: The inventory of homes and condominiums for sale at the end of June in Ukiah is 26 homes. This is 21 percent below the level of June 2020 (33) and it is 15 percent below the inventory last month (30). There were 27 new sales for the month of June. This is 18 percent below the number of sales in June 2020 (33) and it is 42 percent above the sales last month (19). There is now one month of inventory based on the current sales pace. The Days on Market for the 22 closings last month was 38 days. The median price of the homes sold in Ukiah in the past year has ranged from $370,000 to $505,000. The median price was $514,000 for the homes that closed in June.

Hopland and Talmage: The inventory of homes and condominiums for sale at the end of June in Hopland and Talmage is three homes. This compares to 10 homes in inventory at the end of June 2020 and nine homes in inventory last month. There were four new sales for the month of June. This compares to five sales in June 2020 and five new sales last month. There were four closings in the Talmage-hopland market last month with an average days on market of 37 days.

Redwood Valley and Calpella: The inventory of homes and condominiums for sale at the end of June in Redwood Valley and Calpella is 14 homes. This is 18 percent below the level of June 2020 (17) and it is 22 percent below the inventory last month (18). There were 10 new sales for the month of June. This compares to seven sales in June 2020 and four new sales last month. There is a 1.4 months supply of inventory based on the current sales pace. The median price of the homes sold in Redwood Valley/calpella in the past year has ranged from $400,000 to $655,000. There were four closings in Redwood Valley/calpella in June at a median price of $642,000 and the homes sold in 36 days.

For additional information, please contact Gerrett Snedaker at 707-9392009 or gsned@winecountrygroup.com