Wine Country real estate trends in January 2022

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 1,051 homes and condominiums for sale at the end of January. Inventory is 28 percent below that of a year ago (1,454) and it is slightly above the inventory last month (1,046). At times, the inventory has exceeded 10,000 homes in the BAREIS region.

Like most parts of the entire country, and in Wine Country, inventories are at record low levels. There were 956 sales for the month of January. This number is 21 percent below a year ago (1,203) and 9 percent above the pace of last month (881).

There are many unique factors in place in the real estate market right now. There are spiking new listing prices, spiking interest rates, record low inventory, record high (30 percent) of new listings that sell in the first week of coming on the market, record low Price Reduction Ratios (18 percent) for this time of year and record low delinquency rates. Higher interest rates (plus .06 percent) have not yet “hit the market” so it will be interesting to watch closely.

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 18 percent. For January 2022, of all closed homes in our Wine Country markets, the range was from 22 percent (Napa County) to 37 percent (Mendocino County). Conversely, the ratio of homes selling in excess of Original List Price (OLP) ranged from 22 percent (Mendocino County) to 50 percent (Sonoma County). It was 39 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 27 percent where it stands now. The Over List Price has dropped from 55 percent in May to the current level of 37 percent. These are signs of a cooling market after the heated market of last summer.

Mendocino County: The inventory of homes and condominiums available in Mendocino County at the end of January stood at 187. This is 87 percent above the inventory in January 2021 (100) and it is 17 percent above the inventory last month (160). New sales (40) in Mendocino County in January were 39 percent below the pace of January 2021 (66) and they were 25 percent above the pace last month (53). There now is a 4.7 months supply of inventory in Mendocino County based on the existing sales pace. The average Days on Market for the 41 homes sold in Mendocino County in January was 74 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 January in Mendocino County was $512,000. This is slightly above the median price in January 2021 ($510,000).

Ukiah: The inventory of homes and condominiums for sale at the end of January in Ukiah was 31 homes. This is 48 percent ahead of the level of January 2021 (21) and it is equal to the inventory last month (31). There were 13 new sales for the month of January. This is 38 percent below the number of sales in January 2021 (21) and it is 54 percent below the sales last month (28). There is 2.4 months of inventory based on the current sales pace. The Days on Market for the 17 closings last month is 70 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 $512,000 for the homes that closed in January.

Hopland and Talmage: The inventory of homes and condominiums for sale at the end of January in Hopland and Talmage was eight homes. This compares to 11 homes in inventory at the end of January 2021 and seven homes in inventory last month. There was one new sale for the month of January. This compares to one sale in January 2021 and two new sales last month. There was one closing in the Talmage-hopland market last month.

Redwood Valley and Calpella: The inventory of homes and condominiums for sale at the end of January in Redwood Valley and Calpella was eight homes. This compares to six homes in January 2021 and 10 homes last month. There were five new sales for the month of January. This compares to four sales in January 2021 and two new sales last month. There is a 1.6 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 five closings in Redwood Valley/calpella in January at a median price of $740,000 and the homes sold in 111 days.

Lake County: The inventory of homes and condominiums available in Lake County at the end of January

stood at 357. This is 33 percent above the inventory in January 2021 (268) and it is 9.5 percent above the inventory last month (326). Closed sales (83) in Lake County in January were 15 percent ahead of the pace of January 2021 (72) and they were 16 percent below the pace last month (99). There now is a 3.7 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 January is 36 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 January in Lake County was $330,000. This is 11 percent ahead of the median price in January 2021 ($297,000). The homes sold in Lake County last month sold at 97 percent of original list price.

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