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The Fine Art of Analyzing

Interpreting the Current Canvas By Jeffrey Gibson, Sotheby's International Realty

If you look at the general residential first quarter sales data for Sonoma Valley the picture is still muddled, its message unclear.  The number of sales is up—total unit sales volume in the first quarter are up more than 22 percent compared to winter of 2010, but the average single family home sales price is actually down, from almost $580,000 to $556,000.

And when you segment the market you get what appear to be more contradictory numbers. For instance, the volume of home sales for less than $500,000 are up nearly 30 percent compared to 2010, (70 versus 54) but the average sales price is 7.5 percent lower. For homes selling for a price between $500 thousand and $1 million dollars, the picture is reversed: volume is down 15 percent but the average price for this segment has risen almost 12 percent.

At the upper end—that is properties selling for over $1 million and where Sotheby’s International Realty holds a 37% market share over the past year, the numbers reflect a very small market.  For example, in the $1 to $2 million market, the number of sales is up, but from just five properties trading hands in the winter months of 2010 to seven selling this past quarter.  While the average sales price dropped from $1.5 to just over $1.3 million.

Nonetheless, there are two compelling reasons to believe that the worst is behind us – at least in the upper end.  One is that two significantly expensive properties have changed hands in the just the past four months: Gary and OJ Shansby’s “Shanel” and the Emery’s 300+ acre horse farm and vineyard on Gehricke Road.  It has been reported that the Shansby’s sold for over $29 million and the Emery’s for  $13,600,000.

The second reason to be hopeful is that our bell weather market—that is close to the Plaza on the east side is enjoying a bit of a recovery.  This assessment is somewhat anecdotal but nonetheless tells a story.  In the 3rd and 4th quarters of last year there were several close-in east side sales including two on prestigious 2nd St. East, that sold for less than $700,000. And so far this year, there have been six comparable sales for over $800,000.  Again, this is such a small set of numbers that it is difficult to clearly see the message on the canvas as a reborn, booming market.  Nevertheless, this is our most active neighborhoods in terms of transactions and if it’s to be believed, the market data on the canvas shows great signs of renewal.
 

Jeffrey G. Gibson
Vice President, Brokerage Manager
Sotheby's International Realty
 (707) 935-2287