Sonoma County home prices rose to a new high in February, when a shortage of homes exacerbated by the October wildfires forced buyers to routinely outbid the asking price.
The median sales price for a single-family home climbed to a record $689,000 in February, according to The Press Democrat’s monthly housing report, compiled by Pacific Union International senior vice president Rick Laws. The median price increased 2 percent from January and 14 percent from a year earlier.
When considering desirable homes, buyers today generally expect to bid above the asking price in order win the properties, real estate brokers said.
“It’s just a question of how much,” said Lori Sacco, managing broker for Vanguard Properties in Sebastopol.
The buyers’ bids often exceed 5 percent of the list price, brokers said, or about $40,000 for a home priced at $800,000.
“We’re definitely driving the prices up just to get an offer accepted,” said Ingrid Mathews, co-manager of Better Homes Realty in Santa Rosa.
October’s wildfires, the most destructive in state history, claimed 24 lives and destroyed nearly 5,300 homes.
Before the fires, buyers here already faced a sellers’ housing market with relatively limited inventory and rising prices. By last spring the county’s median home price had more than doubled since hitting a low of $305,000 in February 2009, during a national housing crisis.
However, the fires set off a scramble for housing and apparently prompted more sellers to bring properties to market in winter, normally a subdued period.
Since November, new listings of single-family homes have increased nearly 26 percent from a year earlier and sales have climbed almost 14 percent.
Buyers purchased some 261 homes in February, an increase of nearly 5 percent from a year earlier. The month ended with a total of 492 homes available for sale, slightly better than a year earlier.
In contrast, February 2012 ended with more than 1,000 homes on the market. That was a month when half the homes sold were foreclosures or other economically distressed properties that homeowners had lost in the housing bust. As foreclosures declined in number, so did the overall inventory.
Now, buyers and sellers alike are trying to grasp how long and deep the real estate market will be impacted by the October wildfires. County home sales routinely increase in spring and typically peak between May and August.
In order to win bidding wars, a number of buyers are offering to purchase properties with all cash. Their ranks include buyers who’ve recently sold homes and fire survivors who’ve received payments from insurance companies. Some buyers lost homes in the fires and moved into rental units or with relatives. Five months later, Laws said, “they’re finding out that this is not comfortable.”
Working with Glen Ellen-based real estate analytics group Terradatum, Laws has been tracking the sale of burned lots in the fire zones. For the period of 12 weeks ending Friday, he reported the median price for sold lots was $243,000.
Earlier this year the burned lots were listed for sale at the rate of about 25 a week. Last week the number of new listings dropped to 12 and the trend has been decreasing for about a month. Even so, Laws said he still expects hundreds of such lots to eventually be sold, and the phenomenon will “take years to play out.”