Wine Country real estate trends: October 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. Yearover-year statistical comparisons are therefore going to be skewed by these market aberrations created last year. The closings of this year are more “normalized” than the closings of October 2020 so it may look like a “slow down” in an otherwise healthy market.

North Bay Real Estate trends for October 2021

For all of the areas covered by our Multiple Listing Service (BAREIS), which includes Marin, Mendocino, Napa, Solano and Sonoma Counties, there was an inventory of 1,949 homes and condominiums for sale at the end of October. Inventory is 20 percent below that of a year ago (2,440) and it is 6 percent below the inventory last month (2,074). At times, the inventory has exceeded 10,000 homes in the BAREIS region. There were 1,571 sales for the month of October. This number is 8 percent below a year ago (1.707) and 3 percent below the pace of last month (1,621).

Prices normally peak in October and stay level through January. National forecasts predict increasing inventory and a slowing of price appreciation in the coming months and into 2022.This seems to be happening across Wine Country and we’ll see if this is a seasonal trend (the end of summer market) or a longer term direction. The median price for all homes closed in the BAREIS region was 10 percent higher than a year ago.

I have been following a data point I call the “Price Reduction Ratio” (PRR) for the past year, or so. Across the country, on average, one might expect that 30 to 35 percent of the homes put into the MLS will have a price reduction before they eventually sell. Currently, for the entire country, the ratio is 29 percent, up from a low of 15 percent in April of this year. For October 2021, of all closed homes in our Wine Country markets, the range was from 20 percent (Sonoma County) to 24 percent (Napa County). The ratio was 22 percent in Mendocino County. Conversely, the ratio of homes selling in excess of Original List Price (OLP) ranged from 54 percent (Sonoma County) to 27 percent (Mendocino County). It was 44 percent in Napa County. The average Price Reduction Ratio for all areas has gone from a low of 14 percent in May of this year to 22 percent where it stands now. The Over List Price has dropped from 55 percent in May to the current level of 42 percent. These are signs of a cooling market after the heated COVID run-up of last year.

Mendocino County: The inventory of homes and condominiums available in Mendocino County at the end of October rose for the ninth straight month last month and stands at 194. This is 29 percent above the inventory in October 2020 (150) and it is 7 percent above the inventory last month (182). New sales (58) in Mendocino County in October were 23 percent below the pace of October 2020 (75) and they were 3 percent below the pace last month (60). There now is a 3.3 months supply of inventory in Mendocino County based on the existing sales pace. The average Days on Market for the 60 homes sold in Mendocino County in October is 60 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 October in Mendocino County was $508,000. This is 5 percent below the median price in October 2020 ($535,000).

Ukiah: The inventory of homes and condominiums for sale at the end of October in Ukiah was 44 homes. This is 29 percent ahead of the level of October 2020 (34) and it is 10 percent above the inventory last month (40). It is the highest level of inventory in Ukiah since May of 2020. There were 22 new sales for the month of October. This is 57 percent above the number of sales in October 2020 (14) and it is 22 percent above the sales last month (18). There is two months of inventory based on the current sales pace. The Days on Market for the 20 closings last month is 66 days. The median price of the homes sold in Ukiah in the past year has ranged from $370,000 to $519,000. The median price was $488,000 for the homes that closed in October.

Hopland and Talmage: The inventory of homes and condominiums for sale at the end of October in Hopland and Talmage was seven homes. This compares to 10 homes in inventory at the end of October 2020 and five homes in inventory last month. There were two new sales for the month of October. This compares to two sales in October 2020 and one new sale last month. There were no closings in the Talmage-hopland market last month.

Redwood Valley and Calpella: The inventory of homes and condominiums for sale at the end of October in Redwood Valley and Calpella was 17 homes. This is 55 percent above the level of October 2020 (11) and it is 15 percent below the inventory last month (20). There were six new sales for the month of October. This compares to five sales in October 2020 and four new sales last month. There is a 2.8 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 $725,000. There were six closings in Redwood Valley/calpella in October at a median price of $595,000 and the homes sold in 73 days.

Lake County: The inventory of homes and condominiums available in Lake County at the end of October stands at 464. This is 44 percent above the inventory in October

2020 (322).

and it is essentially equal to the inventory last month (463). Closed sales (107) in Lake County in October were 7 percent above the pace of October 2020 (100) and they were 15 percent above the pace last month (93). There now is a 4.7 months supply of inventory in Lake County based on the existing sales pace. The median Days on Market for the homes sold in Lake County in October is 26 days. Usually “Days on Market” are traced from listing date to pending date, so the closing date would be somewhat longer. The median price of the homes closed in October in Lake County was $339,000. This is 7 percent ahead of the median price in October 2020 ($316,500). The homes sold in Lake County last month sold at 96.3 percent of original list price.

For additional information, contact Gerrett Snedaker at 707-939-2009 or gsned@winecountrygroup. com*