History Repeats Itself — Marin County Real Estate Appreciation

Everyone knows that, barring unusual circumstances, real estate prices move upwards over time. Of course, there are cycles. But, over time prices rise. Nowhere is this phenomenon more apparent than Marin County, California. According to the Marin Association of Realtors, the prices for single family homes and condominiums have gone up every year for forty years (except during the recession of 1990-1992).

• In 1987, the average price of Marin homes was under $200,000.
• In 1997, the average price of Marin homes was over $400,000.
• In 2007, the average price of Marin homes is over $1.2 million.

With these facts in mind, buyers can confidently be assured that although prices have softened in the past year in some parts of Marin (but, certainly not all of Marin), prices will continue to rise over time. In addition, the last time home prices softened in the early 1990’s, interest rates were 18%. Today, interest rates are about 6.25% (for conforming loans). Of course, these historically low interest rates will not last forever. And history tells us that prices will go up. So, the overall market environment for buyers is as good as it will likely get for any meaningful time frame.

Marin County, California, Luxury Homes Report (December 2007–Sales and Inventory Analysis)

As expected, Marin County’s $2 million to $4 million luxury market experienced a seasonal reduction of inventory–we now have 76 active listings compared to 108 homes in November 2007. Eighteen homes sold last month (up by 2 from October). Mill Valley, with its temperate weather, good schools, and easy commute to San Francisco via the Golden Gate Bridge, again accounted for the most sales, with 6. Tiburon had 4 sales, Sausalito, Kentfield, and San Rafael each had 2 sales. Rounding things out were Belvedere and San Anselmo with 1 sale each. Overall, the luxury segment in Marin County surged: the average days on market for homes that sold was 74 days, the average sales price about $2.76 million (roughly $813/per sq. ft.), and these homes averaged about 3,585 square feet. More than in years past, pricing, curb-appeal/landscaping, and tasteful staging are of utmost importance.

The inventory level in Marin County’s ultra-luxury market (homes priced in the $4 million and up range) remained relatively unchanged with 33 active homes on the market (down by 2 from November 2007). Tiburon, as usual, boasts the largest number of such homes with 13. It is followed by Belvedere with 7, Ross with 5, and Kentfield with 4. With just one sale last month, the ultra-luxury market in Marin faltered (there 6 such sales in September and 4 in November). There are, however, 5 of these ultra-luxury homes currently in escrow (2 in Tiburon, 1 in Belvedere, 1 in San Rafael, and 1 in Sausalito). Homes in this category averaged about 77 days on the market, sold for about $4.55 million, and boasted over 4,150 sq. ft. of living space. Marin’s most expensive home is a unique gated Tiburon estate sitting on eight acres with stunning views and resplendent gardens–asking price: $38.5 million.

Marin Cities & Towns	$2 Million ? $4 Million		$4 Million & Up
	Active	Pending	Active	Pending
Sausalito	5	1	1	1
Belvedere	9	1	13	2
Tiburon	20	5	13	1
Mill Valley	14	4	1	0
Larkspur	4	0	0	0
Corte Madera	1	1	0	0
Kentfield	5	0	4	0
Greenbrae	1	1	0	0
Ross	5	1	5	0
San Anselmo	4	1	0	0
San Rafael	3	2	2	1
Novato	5	0	0	0

The above graph identifies the numbers of active listings and homes in contract in the Marin County luxury and ultra-luxury home market segments. Note that all homes in contract are included in the category ?Pending? even though some are technically ?Contingent? properties (e.g., the buyers have not removed all contingencies). This information is limited to Marin County’s Highway 101 corridor towns and cities that consistently maintain a monthly inventory of luxury and ultra-luxury homes (e.g., towns without a consistent luxury market and beach homes are not included here). Call Kyle Frazier, CRS, Broker Associate, Frank Howard Allen Realtors of Marin, at 415/350-9440 with any questions about a particular neighborhood or your situation. You can also e-mail Kyle at [email protected].

Mill Valley Real Estate Update (December 2007 Home Sales Report)

The arrival of Winter, as it pertains to real estate in Mill Valley, California, brings a severe reduction of inventory of single family homes for sale. With just 46 homes currently on the market (down from 73 last month), the market has a very tight supply of homes. Indeed, with 25 sales last month, Mill Valley’s absorption rate is under 2 months. However, this is a seasonal phenomenon–lots of folks take their homes off the market during the holidays and put them back on the market in the Spring. Incredibly, there are just 13 homes are currently on the market under $1 million! As always, the commute to San Francisco from Mill Valley via the Golden Gate Bridge (a short 5-10 minutes), along with the excellent Mill Valley schools, pleasant weather and laid back ambiance provides ample motivation for San Francisco professionals to relocate to Marin County. Accordingly, prices and sales are ever-strong. Indeed, Mill Valley is THE place people thinking of moving out of San Francisco generally start with when they decide to buy a home in Marin County.

Mill Valley homes priced between $1 million and $1.5 million (Mill Valley’s bread and butter homes) continue selling briskly–8 of these homes sold in November 2007 (same as October). As with much of the rest of Marin, homes priced aggressively are getting multiple offers?note: the winning bid (which is not always the highest bid) is likely to be a couple of percent above asking price, depending on the home ad price. Mill Valley luxury home sales jumped last month with 6 sales in the $2 million – $4 million price range, compared to just 2 in October 2007. None of Mill Valley’s ultra-luxury homes (in the $4 million and up range) sold in November and just one remains currently on the market.

Mill Valley homes that sold during the past month averaged 62 days on the market and sold for an average price of about $1.5 million (about $686 per square foot). As usual, the hottest market segment was the $1 million to $1.5 million price range. That said, all but the ultra-luxury segment remain very strong with 28% – 33% of home in escrow.

Marin County Real Estate Update–December 2007 (Homes For Sale & Price Ranges)

San Rafael Real Estate Market Report & Home Sales Update (December 2007)

The housing market in San Rafael continues to show signs of strength entering into December 2007. Inventory is down to 114 active listings (down from 179 homes on the market in November 2007). As noted below, San Rafael’s bread and butter homes (those priced between $750,000 and $900,000) continue to sell if priced in accordance with recent relevant sales. As always, nicely maintained homes, which are updated, and/or located in the most desirable neighborhoods continue to sell. Yet, buyers continue to exercise extreme discretion. As noted elsewhere in my reviews of home sales throughout Marin County, whereas buyers used to settle for homes that had 5 of their top 10 amenities, buyers are now waiting for homes that fulfill 8 or 9 of their top 10 wants or needs.

Of the 34 homes that sold during the past month (sales are up as San Rafael had 32 home sales in November 2007), they averaged about 69 days on market, for an average price of about $1,098,000 (about $477/square foot). Twelve of the homes that sold in November 2007 were priced under $800,000 and another 7 homes sold between $800,000 and $1 million. 

It is noteworthy that San Rafael’s luxury and sub-luxury markets remains very active, with 36%-43% of homes in escrow (that is a Sellers’ Market folks).  In fact, a large Upper Lucas Valley equestrian estate priced over $7 million remains in escrow (and another home in Lucas Valley Estates closed escrow at $1.8 million). And the market also remains at a slow boil at the entry level, with 38% of homes in escrow.  These are very strong numbers! For a brief discussion regarding the importance of the percentage of homes in “Pending” status, click HERE. San Rafael’s strongest micro-climate markets during the past month included The Dominican, Glenwood, Terra Linda, Marinwood, Peacock Gap, and Lucas Valley (including two homes in Lucas Valley Estates). Renovated Eichler homes, particularly those in the Berry Patch) continue to see strong sales.

Feel free to contact Kyle Frazier, CRS, Frank Howard Allen Realtors with any questions: (415) 350-9440 or e-mail me at [email protected].

Novato Real Estate Market Update (December 2007 Home Sales Report)

The housing market in Novato is picking up as December sets in. It provides a wonderful environment to live in. Novato’s abundant inventory of relatively affordable homes (including newer construction under $800,000) is giving home buyers who are looking to buy right now a very good selection of homes with value. As for sellers, moreso than in any other town in Marin County, homes MUST BE PRICED FOR TODAY’S MARKET. They must be maintained, updated, and/or located in a desirable neighborhood if they likely to sell. In any event, as buyers who have held off on making offers all Summer and Fall can attest, there are some amazing values right now. As a result, showings are on the rise in Novato. There are lots sales with big down payments and short escrows. Yet, it seems some buyers are still waiting to see what happens with prices (although they may learn a hard lesson in mortgage math should interest rates rise in coming months). Indeed, with the percentage of homes in escrow nearing all-time lows in Novato, this is possibly one of the best markets buyers are going to see for a long time.

Homes in Novato that sold in November 2007 (there were 26 home sales–up by 5 from November 2007) averaged about 106 days on market, for an average sales price of $729,000 (roughly $399 per sq./ft.). Homes in Hamilton Field (particularly Southgate and Inspiration), Pointe Marin (especially those is Breakers), Presidents, Rush Creek, Indian Valley, San Marin, and Partridge Knoll continue to get robust numbers of showings, as do the new luxury homes at Stonetree.