With the springtime rush behind us, we find that the value of Marin County homes is about the same as last year. As we predicted in early in 2019, home values have leveled out.
We report separately on single family homes (SFHs) and townhouses/condos for these reasons:
- Condos and townhouses are about half the square footage of single-family homes.
- Sale prices are about half the price of SFHs.
- Condos/townhouses comprise only 20% of the homes sold.
Sales of Single-Family Homes This Year
Looking at the first seven months of 2019, this is the picture that emerges for SFHs:
- The number of SFHs sold in 2019 is close to 2018 (1,276 versus 1,289).
- The selling price is about the same as last year: average up 1%, median down 1.5%.
- The value of SFHs sold, based on $ per square foot, is the same as last year: $671 per square foot.
Sales of Townhouses and Condos This Year
This is the overall picture for condos and townhouses:
- The number of condos/townhouses sold was 6% lower this year than in 2018 (327 versus 349).
- The selling price (average and median) is down 5-6%.
- The value of condos/townhouses sold, based on $ per square foot, is about 2% less than last year.
NOTE: These are values for SFHs and condos/townhouses in all of Marin (data from the Marin MLS). We found very similar results for individual cities; for example, Mill Valley, Corte Madera, Kentfield/Greenbrae, San Rafael, and Novato.
Price Reductions—What is Really Happening
We have heard through our Top Agent Network about many price reductions this year. Why is this happening? What is the effect on Marin real estate?
Price reductions should result in lower sale prices, but this has not happened. Instead, prices of single-family homes are steady, while prices of condos and townhouses decreased.
Our best explanation is that sellers, encouraged by our strong market, priced their houses high. The best houses are selling higher than ever, with many offers and cash buyers. However, houses that buyers consider as overpriced or poorly prepared for sale, sell only after price reductions. After one or more price reductions, these houses sell at a reasonable market price. The result is a leveling of house prices.
The low level of housing inventory and high demand for homes keeps us in a seller’s market but moving closer to a balance between buyers and sellers. The best homes are still receiving many offers and are selling up to 10% over asking price. In many sales, one or more buyers offer all cash for a property.