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Marin County Real Estate Tracker — December 2019

Zephyr MarketTracker Zephyr
End of the Year Reflection

As the year winds down in a haze of fairy lights and instrumental, holiday music, we wanted to take time to reflect on the market correction that we have followed so fervently over the past months. Almost all the indicators now confirm this correction; those indicators include not only median sales price (MSP) but also market conditions. While December is a tricky month to judge due to the holidays, we can be more assured of accuracy by comparing a few different timeframes and locations. Let’s take a look at the annualized and month over month data as well as the other major US metropolitan areas.

Annualized vs. Month over Month

The annualized (1) November numbers show a 3.36% decrease in MSP of single family homes over the last year. In that same time the MSP of condos has dropped 1.84%. If we look at November 2019 over November 2018, the MSP of condos has dropped 3.70% and that of single family homes is actually up 9.13%. Generally speaking, annualized numbers are more reliable. To better understand the landscape, let’s zoom out.

The Case-Shiller Report

The Case-Shiller Report (2), September 2018-September 2019, reveals that the San Francisco Bay Area (which includes Marin) is down 3 points. That is the largest drop out of all 16 metropolitan areas. We are one of only 3 locations to show declines. Based on the Case-Shiller Report as well as our own local data, we think it’s safe to say that our real estate raced to the top over the last seven years and now we are correcting.

Inventory, MSI, and Absorption Rate

With the Case-Shiller Report, the annualized numbers, and the year over year analysis in hand, the ostensibly chaotic inventory studies begin to make sense. Even with the seasonality of the Marin market, the drop in new listings is impressive. New listings of single family homes are down 44.57%, and new listings of condos are down 50%.

Another way to understand inventory is through the month’s supply of inventory (MSI) (3) and the absorption rate (4). Both MSI and the absorption rate indicate the same trend: MSI is up significantly, which means that there are more houses on the market. The absorption rate is down, which means that fewer hoses are selling (as a percentage of inventory). Simultaneously, overall inventory continues to grow. Over the last 2 years, the number of active listings has increased (with single family homes up 6.57% and condos up 14.54%).

How can this be, particularly as demand seems to press on at a good pace? As appreciation slows, buyers become more value conscious. The well-priced, staged properties sell. Others tend to sit. Thus, we see pending sales of single family homes and overall inventory climbing…at the same time!

Prospective Buyers and Sellers

How should prospective buyers and sellers interpret these numbers? Well, the correction indicates a dip in MSP. However, here at Zephyr, our anecdotal evidence suggests that our sellers who invest in preparing their properties for sale out-perform the market. Due to low interest rates and prices that generally reflect a correction, buyers have a significant opportunity to become homeowners.

(1) Annualized numbers rely on sample data from a part of the year to predict the data for the entire year.

(2) The S&P/Case-Shiller Composite Home Price Index measures the change in value of residential  real estate in 16 U. S. metropolitan areas. The indices here reflect  the  average change in San Francisco values (San Francisco, Marin, Alameda), but do not  reveal actual home prices.

(3) Months supply of inventory (MSI) is a measure of how long would it take to sell out the current inventory if no new listings were brought on the market. In November, it would only take 1.4 months to sell out all available inventory of single family homes. While this represents an increase over November of 2017, a balanced market has an MSI of 6.

(4) Absorption rate measures the percentage of available inventory that sells in a given time frame. A lower absorption rate indicates fewer sales with respect to inventory.

All Marin
Sold for $729,000
42 Bridle Path Lane, Novato
3BR // 3BA // Listed for $729,000
Sold for $1,895,000
250 Hillside Avenue, Kentfield
3BR // 2.5BA // Listed for $1,995,000
Sold for $1,200,000
137 Convent Court, San Rafael
4BR // 3BA // Listed for $1,150,000
Sold for $2,151,000
61 Elizabeth Circle, Greenbrae
4BR // 2.5BA // Listed for $1,995,000

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Happenings Around the Bay Area
The holidays bring lights galore! The Bay Area is no stranger to going all out when it comes to decorating homes, businesses and public spaces with lavish lights. Checkout one of these 20 illuminated spots around the Bay Area. From residences, to buildings to even a cemetery, these places can’t be missed, literally! Bundle up and go for an adventure around your neighborhood to find one or more lit up destinations from this list. Read More »»
If you’re still scrambling to get all of your gifts together for the holidays, you’re not alone! It’s always a special treat to give a unique gift from one of the Bay Area’s many local artists and it’s not too late to finish up any last minute holiday shopping. Shop local and find some inspiration on this list of 62 thoughtful holiday gifts made in the Bay Area! Read More »»
The holidays are a time for giving. As we buy new things, why not donate the ones we no longer need? Often times, we have excess toys lying around that could use a new home. There are many local organizations around the Bay Area that take donations of many gently used toys that could be given to new families. If you’re not sure where to start, this list contains local donation spots convenient for you!   Read More »»
David O'Brien
Broker Associate GRI
LIC# 01832087
Source: San Francisco Association of REALTORS® MLS (SFAR MLS). Display of MLS data is deemed reliable but is not guaranteed accurate by the MLS.

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