Tag: RealEstate

Are things slowing down? 

When’s the correction coming? 

There IS a correction coming … right?

Heading into the backstretch of second quarter home sales in western Nevada County, those with their eyes on the market are regularly being asked the same questions.

While we await the arrival of our crystal ball (apparently on back order like seemingly everything else right now) let’s take another look at the latest statistics on our local market to identify developing trends.

KEEPING PACE

If you’ve been following along at home over the past several months, you know market prices have been pushing higher largely due a high demand for, but low inventory of, homes listed for sale.

Over the course of 2021’s first five months, despite a slight uptick of inventory, the median price of homes sold remains on the rise, or at least holding steady. 

But it’s the year-over-year comparison that has everyone shaking their heads in disbelief and wonder.

May’s median sale price was $549,000 — 34% higher than the $410,000 median of May 2020 — following April 2021’s $550,000 median. Among all sales in 2020, the median price was $455,000. 

So far, 2021’s median price of homes sold works out to $528,000, up 24% over $427,000 in the first five months of 2020.

The completion of the second quarter sales will help shed light on whether the market has hit a plateau in median price, but to date there’s not much indication the market’s cooling off now in the midst of the summer months.

TAKING INVENTORY

Since February’s low of 159 homes listed for sale, there have been more options for buyers to consider over the past three months, with 214 homes listed in April and 205 in May. 

But those numbers still reflect a drastic drop of homes typically on the market this time of year.

Between the years 2016-2019, the month of May saw an average of 447 homes listed for sale in western Nevada County. Even amid the uncertainty of 2020, there were 431 homes on the market a year ago this time, more than double the current inventory.

THESE ARE THE DAYS

The effect of the low supply and high demand is also evident in average days on market, a statistic slimmed down to a single digit for the second straight month. It took an average of eight days to have an accepted offer between buyer and seller in May. That’s actually one day fewer than April’s nine-day average, which followed a 14-day average stay on the market in March.

A more typical timetable in western county is the 54 days on market average in the month of May in each of the past five years, including the 45 days averaged in May 2020.

The monthly average of days on market for all of 2021 now stands at 13 days.

The monthly average of days on market for all of 2021 now stands at 13 days.

STEADY AS WE GO?

With the slight uptick in homes available over the past few months, more homes are being sold since the start of the year, and actually keeping pace with the last half of 2020, one of the most productive six months in western county sales in recent memory.

Between 2016-2019, there were an average 121 homes sold on a monthly basis. With sales surging amid the pandemic, that number shot up to an average of 175 homes sold monthly over the final six months of last year, bringing an average of 145 homes sold per month in 2020.

So far, even with such a smaller inventory available, western Nevada County has seen an average of 138 homes sold monthly in 2021, with April (172 homes sold) and May (162) — actually keeping stride with 2020’s striking second-half surge in sales.

Brian Hamilton is the assistant to the regional manager for the Betsy Hamilton Real Estate Team. Contact Betsy Hamilton at realestatebetsy@gmail.com or 530-263-9044. Visit MidLifeOfBrian.com for previously published market updates. Contact Brian Hamilton at BrianHamiltonRE@gmail.com.

How can this continue? At some point, these prices have to come down … right?

It was a question we’d considered for months, as we weighed our options of continuing to rent or test the waters of homeownership.

My friend offered a short laugh. 

“Nah, real estate in California doesn’t go down … only plateaus and then up again.”

After six years of watching prices continue to climb, we jumped in as first-time homebuyers.

That was 2006. 

BY THE NUMBERS A snapshot year-over-year look at the month of October real estate market stats for western Nevada County. $490,000 — Median sold price (2020) $412,00 – Median sold price (2019) 12- median days on market (2020) 47 — median days on market (2019) 155 – homes sold (2020) 121 – homes sold (2019) 289 – total homes listed for sale (2020) 501 – total homes listed for sale (2019)

The following year, we learned that, in fact, California’s real estate does decline — particularly amid a complete collapse of the market across the country.

(No worries, my friend. Names will be withheld to protect the innocent.)

We’ve been considering the same question, now years later, as homeowners on whether it’s time to consider selling. 

OK, truth is my wife has been considering such a question and I’m panicking to change the subject before any actual discussion of substance can be had, because … well … I don’t want to move!

But the market now seems to once again have our home valued somewhere in the neighborhood of our initial investment. So the conversation typically begins and ends with her seeing opportunity with each new listing, and me being a stick in the mud who can’t imagine moving outta our home.

Of course, we’re both right to have such perspectives.

The roof over our head is both our home and our investment. And it would seem likely this market has invited similar discussions in our neighborhood, and those across the region and the state, for that matter.

SUPPLY & DEMAND?

As I continue to learn about this industry on a daily basis, it seems the driving force behind what experts continue to call this current “hot market” basically boils down to the simple supply and demand principle.

There are currently 289 homes for sale in western Nevada County.

That’s 42% fewer than the 501 that were in the market this time last year.

And of the 155 homes sold in the month of October, the average days on market was 12 — that’s no typo: twelve days — and the median price of those sales was $490,000 — an 18.9% increase over October 2019’s median of $412,000.

The reduction in monthly inventory has been consistent since the end of the first quarter, which was on pace with 2019 numbers. Both the second and third quarters of 2020 saw significant dips in inventory in year-over-year comparisons. In fact, not once in a single month last year did western Nevada County’s inventory of homes for sale drop below 300. 

October marked the fourth-straight month below that threshold in 2020.

But, despite the reduction in inventory, there were 30 more homes sold last month in western Nevada County than in October 2019. And 2020 in total is on pace to surpass 2019 sales. 

And, of course, all of that brings us back to question on the table, whether we should be considering the current state of the market and a potential return on our investment, just as we did years ago when we first became homeowners.

Which reminds me, Hon.

Not to change the subject, but can you believe Notre Dame is ranked No. 2 in the nation? 

Brian Hamilton is assistant to the regional manager for the Betsy Hamilton Real Estate Team. Contact him at BrianHamiltonRE@gmail.com.