Sonoma County Luxury Homes – Record High Sale

Sonoma County continues to make news around the world. There is no doubt especially amongst the wealthiest that Sonoma County is a coveted world destination. What appears to be a record sale of 31 Million dollars has closed escrow on a Luxury Estate situated on 382 acres located west of Sonoma.

The record sale price is the highest in the State since a 26.5 Million dollar sale in Bel-Air in 2009.  More details in the Santa Rosa Press Democrat.


Foreign Real Estate Buyers

Apparently it’s a Real Estate sales feeding frenzy in Miami, New York, Los Angeles and San Francisco. While the local and national Real Estate news is marred by Foreclosure Fraud stories

and while buyers locally have taken to the sidelines as they are uncertain of the direction of the market, another type of buyer is stepping up.

International buyers are in the limelight as they are driving sales, with an exchange rate in their favor compounded by a %50 off sale they are looking at an opportunity of  lifetime unlike one they have ever seen before.

canada photo

Coldwell Banker, Wells Fargo are they doing their job ?

Coldwell Banker put out a press release a short while ago reporting million dollar home sales up 28% in Silicon Valley for the month of August, a sharp rise from a year ago.

As I mentioned on a previous post I am recommending to the buyers on the sidelines that you not wait until clients from outside the area come here and pick up all the great deals.

A percentage of these sellers look north to buy a replacement property and stay close to family. Read the article here.

Bloomberg reported chief economist John Silvia of Wells Fargo stating that housing values will probably increase 5% in 3 – 6 months. One of my resposibilities in this business is looking at values and market activity.

There are pockets of homes for sale experiencing multiple offers and not at just the entry level. Current activity shows several homes priced in the 800 – 1 million dollar price range showing as under contract just days after comming on the market and most noticeable been 724 McDonald Ave Santa Rosa priced at 899k .

MLS shows days on market as 12 prior to going into contract. Maybe John Silva is on to something. Read the article here.


Santa Rosa Luxury Homes

Luxury Homes in Santa Rosa priced between the $1,000,000 – $2,000,000 price range have had a mixed bag of news. Sold homes are all over the board as far as values go. We are witnessing two types of buyers in the market, on one hand we have the local buyers that are in the market and refusing to write an offer until they feel a home is priced low enough for them to consider it a deal. For many of these buyers today’s low is not low enough. The fact that most of these homes are priced below today’s replacement costs does not seem to resonate with them. They are missing an opportunity of a life time.

Now of course in any market we have the optimists who know the local market and when they find something they like, they just buy it. They understand fully that they could be pulling the trigger a little early but having a home in the location, condition, and amenities they seek is important. They also understand that several years ago they would have paid hundreds of thousands more and that the price they are buying for today is below cost to build. This of course does not even take into account that it will be a long long time before we see high end homes built at the scale we saw in the 90’s. Just not that many places left to build.

Several recent sales to help you with the above paragraph. 1) 926 Quarry Point closed at $1,199,000 with multiple offers. Full price all cash. That’s $331 per square foot. 2) Currently under contract another home that has received a full asking price at $414 per square foot again a home priced over a million dollars.

For me this is reminiscent of the mid 90’s. Some of the local buyers purchased but most stayed on the sidelines. It was only after the buyers from silicone valley drove up here and purchased much of the inventory available under the cost to build before the local market jumped in. The majority of the best deals where gone.

Other news from the over $3,000,000 dollar market include all cash buyers from out of state writing full price offers. Some walking into offices without representation and yet others calling agents directly. Large multi million dollar properties are selling in Sonoma County with many transactions going unreported.


Prices up in 20 major cities

The S&P/Case-Shiller index for the month of May shows price increases for home values. I have not been a supporter of this index from the standpoint that the Real Estate Market does not always move in a linear direction. The media picks the numbers up and before you know it the recent information becomes gospel and is used to cause the “mania flavor of the day”.

I do like the fact that good news helps with confidence and that we can use this information to make our calls and help clients along in their decision making process. Personally I like the less marketed index…The SC/Cost-Build index also known as the Sonoma County cost to build a home relative to current asking prices. This is the index I use and made up specifically for this post.

Today’s asking prices are less than replacement value and this is the index I believe should be taken seriously as there are great deals to be had.


The Case-Shiller news here

Luxury Home Sales Jump in Marin County

Great news in the luxury home market. Marin County sales jumped to the highest level in over 2 years as a reported 78 homes sold in June. I checked Marin multiple listing statistics and indeed this number is correct. What is not reported however is that currently there are 86 homes over one million that are under contract and 24 homes that have closed so far in July.

All this is good news indeed and as I mentioned in an earlier post, local buyers who are on the sidelines should take notice and not wait, for many of those Marin sellers will be up here picking up the current inventory. Many if not most luxury homes on the market are priced below the cost to build, along with low interest rates it is a great time to consider making a move.

What will it take to get this market moving? Guess what….it is

The first half of 2010 has been tepid at best, and many are holding their collective breath. The recent housing news has buyers and sellers, on the edge of their Real Estate seats.

This week I witnessed a fairly large Luxury Home go into contract and tonight I found an article that talks about the return of low doc loans. Though many believe it was these loans that led to the financial markets demise they are an important tool especially for the self employed with irregular income.

From my point of view that is two great pieces of news and if we can put a couple of back to back job numbers we just might have something. Hey I’m an optimist what can I say.

The Luxury Market “whisper numbers” are out and from what I hear some very large transactions have taken place in Sonoma County upwards of the 20 Million dollar price range. So while many buyers are on the sidelines waiting…..and waiting….. for prices to drop further, other buyers from out of the area are dropping in and see Sonoma County as very affordable.

My question to the local buyers is why are you waiting for someone from out of the area to convince you that many homes are well priced. I would think that buying below replacement cost should be pretty good incentive. If that is not enough incentive why not give me a call, lets get together on a Sunday and drive to San Francisco and look at a few open houses priced at a couple of million. If you have not done that yet, I highly recommend it.

Sonoma County the premiere wine region of the world with Mediterranean type climate is looking better and better.