Monday, 13 February 2012

Location still rules in real estate

By ROBERT DIGITALE / The Press Democrat

On a recent Friday night, the Century 21 Classic Properties office in Rohnert Park was bustling with agents working late to write offers and show clients properties.

A few years ago, business was “a lot slower,” said Pat Miller, a broker associate at the office. But times have changed, even in January, often the doldrums for home sales.

“We’re still screaming busy,” Miller said.

In 2011’s bumpy real estate market, Rohnert Park and neighboring Cotati saw their biggest home sale numbers in five years. Single-family sales rose 21 percent last year, while condominium sales jumped 26 percent, according to the Press Democrat’s monthly housing report compiled by Pacific Union International Vice President Rick Laws.

Other communities with their best sales years in a half-decade include Windsor, Healdsburg, Sonoma, west Petaluma and the Sonoma Coast.

Across Sonoma County, home sales rose 7 percent last year as buyers purchased 4,637 homes, the second-best year since 2005. The year’s median price fell 8 percent to $325,000, the lowest since 2000 when not adjusted for inflation.

Some communities turned in stronger performances, while others lagged behind.

In Santa Rosa — the county’s single biggest real estate market — sales rose 5 percent last year but the median price fell 9 percent to $295,000.

In Rohnert Park and Cotati, agents and brokers suggested the jump in sales last year came from both an uptick in buyer confidence and a continued drop in prices. The lower prices at times were exacerbated by an abundance of foreclosures and short sales, where the home is sold for less than the amount owed on the mortgage.

In 2011, the median price for a single-family home in the two cities fell 11 percent to $285,000. That amounted to half the median price in 2005 of $565,000.

The drop in home prices meant that once more “the average family can afford the average house. And the average house is in Rohnert Park/Cotati,” said Matthew Tarr, a broker associate with RE/MAX Pros in Rohnert Park. Most of the homes there were constructed in tract subdivisions rather than by custom builders.

The RE/MAX office sold more homes last year than in 2005, Tarr said.

Along the Sonoma Coast, which includes Bodega Bay, sales increased 18 percent from 2010, while the median price dropped 12 percent to $525,000.

The vast majority of coastal buyers are seeking second homes or vacation rentals. More seemed ready last year to make such discretionary purchase, probably due to low interest rates, lower prices and a belief that “the market’s not going to fall off the cliff,” said Steve Hecht, a broker associate with Artisan Sotheby’s International.

But if buyers are content to snap up deals, many owners trying to sell homes take a different view of the situation, Hecht said.

“The sellers are tired of getting beat up,” he said. “They’re saying, ‘We’ll just wait it out.’”

That view may help explain a near-universal lament by agents and brokers about a lack of available homes for sale. The county ended December with only 1,120 single-family homes on the market, down 32 percent from a year earlier.

In Healdsburg, agents often see a slowdown in business from Christmas until the Super Bowl, said Beth Robertson, a broker associate for Century 21 North Bay Alliance. But this year, perhaps encouraged by the warmer winter, more buyers wanted to go looking for properties.

“The sun’s out and they love it,” Robertson said.

Last year sales were up 5 percent in Healdsburg and 10 percent in Sonoma. For both towns, it was the biggest results since 2005.

The two towns attract a higher share of buyers looking for second homes than do many other communities in the county. Even so, the bulk of their sales today fall under $500,000.

In comparison, “five years ago we didn’t have a house under $500,000,” said Catherine Sevenau, broker/owner of Century 21 Wine Country in Sonoma.

The mid-range market of $500,000 to $900,000 remains sluggish in both towns. But in the last half of the year, Sonoma agents saw “an uptick in the higher end of the market,” those homes priced at $1 million or more, said Jill Silvas, branch executive in Sonoma for Pacific Union International.

For many communities, sales last year got a boost from buyers of rental properties.

“There’s a tremendous amount of investor-type folks with a good amount of cash that are still looking for good buys,” said Tom Lawrence, a broker associate who specializes in Windsor and Healdsburg properties for Wine Country Group.

The housing market now has gone through six years of near-steady declines in home prices. But the extent of that decline varies considerably among communities.

In southwest Santa Rosa, the median price has fallen 56 percent since 2005. Other communities with the largest drops include northwest Santa Rosa, which declined 51 percent; Rohnert Park/Cotati, 50 percent; Cloverdale, 49 percent, Russian River, 48 percent; and Windsor, 45 percent.

At the other end, the median price in Healdsburg is down just 32 percent in six years. The drop in Sebastopol was 34 percent; west Petaluma, 38 percent; and both Oakmont and Sonoma, 39 percent.

Most of the communities with the smallest drops are “eminently desirable places” with “the plaza ambience” of small towns, said Laws at Pacific Union. That desirability curbed the drop in prices.

At the other end of the spectrum, west Santa Rosa and Windsor were home to the bulk of the county’s new home construction in the last decade, said Mike Kelly, an agent with Keller Williams Realty in Santa Rosa.

Those new buyers not only went underwater fast when home values plummeted, but many of them also had interest-only and other “funny money” loans that imploded when the buyers had no chance of refinancing, Kelly said. Many of their homes ended up in foreclosure and values in those neighborhoods suffered even more.

“They just got nailed,” Kelly said.


No comments:

Post a Comment