The number of homes sold in Marin this past quarter remained similar to the first quarter of last year. In 2019, the median sold price dropped by 3%, indicating a softening in the market similar to other Bay Area counties. The number of listings increased by 34%, which give buyers more options when shopping. However, rising interest rates did limit some potential buyers.
In Alameda county, 2019 began with a 1% rise in median price, indicating slower growth in this market. Sellers still received offers over asking price, but they did drop 5% compared to the first quarter of last year. Compared to the same quarter of 2018, the number of homes for sale expanded by 74%, providing increased options to buyers.
In Contra Costa County, median sales prices were up 3% in the first quarter of 2019, whereas other Bay Area counties saw negative growth. Even Santa Clara and San Mateo counties, tech hubs of the Bay Area, saw downward trends in sales prices. However, Contra Costa county did experience a downward trend in sales volume, similar to most other Bay Area regions.
Seasonal change has a large impact on the number of homes sold in a market, with the lowest number typically occurring around December and January.
Increasing homes being sold over listing price is a very good indicator of rising home prices, often fueled by lack of available inventory. Homes being sold under listing price suggests a more normalized market. In San Mateo County, the home price average dropped by 4% indicating, among other factors, that there was a softening in higher priced home sales. Average days on market has been on the rise in San Mateo County. Many people look at days on market trends to spot changes in the real estate market. Increasing days on market implies that competition is down and that buyers are not as eager, although current statistics show that well priced properties are not staying on the market long.
The shifting market has provided an easier environment for buyers to find a house without the stressful competition of multiple offers and overbidding that we have seen over the past couple of years. Home sales volume dropped in the first quarter of 2019, its sharpest decline since the end of the last housing downturn, over 10 years ago. Slowing sales may indicate a softening of home prices, since the average price per square foot dropped by 6% during the first quarter of 2019. Mortgage rates were on the rise at the end of 2018, reducing the buyer purchasing power of Santa Clara residents, but that has since adjusted itself downward and rates are now at a 12-month low. This window of opportunity for buyers couldn’t come at a better time since personal incomes have been rising at a much slower pace than home prices. Adding to this opportunity for buyers is the fact that, unlike in past years, many sellers agreed to offers below their asking price during this last quarter.
Median sale prices rose by 6% in Santa Cruz County compared to 2018 and the number of sales dropped. Interest rates are on the rise, which has limited buyers’ purchasing power; as of now, buyers need a nearly perfect credit score to get the best interest rates. Asking prices are down by 3% compared to the first quarter of 2018. Houses are lingering on the market – another indicator of diminishing buyers’ purchasing power.
The median sales price growth was up by 11% in San Francisco this last quarter. However, in many major Bay Area counties, the housing market will continue to cool and home-price growth will stay low. There is a real chance prices could fall below 2018 levels. The mortgage rates will continue to rise in 2019, possibly impacting buyers’ purchasing power. The average number of days on market dropped in San Francisco, which indicates that the market is still very competitive. This differs from neighboring counties around the Bay, which have experienced a significant increase in their days on market. Many San Francisco sellers are continuing to receive multiple offers at the entry level, and even up to $3.5 million in some cases.
In Sonoma, the number of sold properties dropped by 13% and buyer demand slackened. Buyers remain uncertain about the market and many are waiting for more stable conditions. Furthermore, interest rates impacted the purchasing power of buyers. Asking prices dipped by 4% compared to the first quarter of 2018 and sellers did not tend to receive higher than their asking price, a trend that Sonoma County has experienced over the past years.
Buyers in Solano county saw rising home values but limited inventory in the past years. The number of for sale properties increased by 48% compared to the same quarter of the last year, and it is a good indication that buyers have more choices in their buying journey. Appropriate list prices contributed to quick sales. Sellers did not tend to receive offers over the asking price, similar to surrounding Bay Area counties.
The number of sold homes was down 12% year-over-year, with 584 homes sold countywide, while the number of homes for sale increased and was up by 15% in the first quarter of 2019 compared to the same period in 2018, with average days on market continuing a similar trend.