Marin Real Estate Market – A Strong Start to 2018

So far in 2018, the market seems to have mostly brushed aside concerns about increasing home prices, rising interest rates, stock market volatility and new federal tax law changes. It is still too early to come to definitive conclusions about where the year is going, but right now, in most market segments, buyer demand remains very strong for a limited supply of listings. This is especially true in the more affordable home segments, a dynamic playing out around the Bay Area. Of course, whatever the price segment, how buyers respond to a particular listing depends on the specific property and its location, appeal, preparation, marketing and pricing: Some listings sell very quickly, some only sell after price reductions, and, even in a hot market, some do not sell at all.

Home Value Appreciation
Year-over-Year Comparisons

Marin year over year home price appreciation

The 16% year-over-year jump in median sales prices is unusually high and should probably be taken with a grain of salt until substantiated over a longer period of sales. The 7% increase in average dollar per square foot values is probably closer, but possibly a tad low as an indicator of recent home-value appreciation. (Median sales price and average price per square foot appreciation rates sometimes do not move in parallel when the mix of homes sold appreciably varies – for example, in average home size – from one period to the next.) What is indisputable is that significant market appreciation has continued over the past year, and perhaps accelerated over the last 4 or 5 months. We will know more once the spring selling season really gets going in earnest.

Home Values by Lot Size

In San Francisco, a house worth $1m can sit next to one worth $4m, each on its own narrow, 25-foot-wide, 2500 square foot lot, but in Marin, with more land to stretch out on, home values correlate to a surprising degree with lot size, as illustrated below. Which does not mean this applies to every home in the county, and of course, in Marin, considerable percentages of lots can consist of steep hillside land. Steep hillsides often bring lovely views, while, on the other hand, good-sized, flat yards are highly prized as well.

Additional Chart: Marin Home Sales by Era of Construction

Appreciation by City & Town
by Year

The next 3 charts look at house value appreciation in cities and towns around the area, from most affordable, to more expensive, to most expensive.

In the most expensive communities, median sales prices sometimes bounce around without great meaningfulness due to the quantities of sales being relatively low, and to the very wide range of home sales prices. That said, it is also true that the greatest pressure of buyer demand in recent years has been in the more affordable home segments – affordable by Marin standards – and appreciation in those communities has typically been more consistent since 2015.

Median House Sales Prices
by City since 2010

Average Price per Square Foot House Values
by City since 2012

Supply & Demand Statistics

Months Supply of Inventory (MSI)
& Average Days on Market (DOM)

As seen below, as measured by two classic statistics of supply and demand, the market in recent months has certainly not softened in comparison to the last 2 years, and according to Months Supply of Inventory and the Percentage of Listings Selling within 30 Days (the second chart down), it has become appreciably stronger.

Listings Selling within 30 Days
Year-over-Year Comparisons

Active Listings on Market
by Month & by City

This next chart illustrates both the seasonality of the market and the size of the respective city markets in Marin County. We are just now entering the time of year when inventory swells to fuel the spring selling season. The 3 biggest home markets are San Rafael, Novato and Mill Valley. Tiburon is a smaller market, but now constitutes the biggest luxury home market in the county. Some Marin markets – such as in Belvedere, Ross, Kentfield and Larkspur – are very small, but very expensive.

Additional Chart: Marin Sales Volumes by City & Town

Sales, Price Reductions
& Listing That Do Not Sell

General Market Listings under $2m

The last 12 months have been a strong market in Marin real estate, and the great majority of sales under $2m sold very quickly, and averaged a sales price over asking price. Those listings that had to go through price reductions before selling spent an average of 9 weeks longer on the market. And then for every 8 to 9 listings that sold, 1 listing expired and was withdrawn from the market, typically because buyers deemed the property overpriced. This is a very low ratio of listings that do not sell.

Marin Luxury Home Market

Number of New Listings Coming on Market
& Number of Active Luxury Listings by City

Just as in San Francisco, the luxury home market in Marin is fiercely seasonal, with the market slowly waking up in the first two months of the year; soaring in spring, the dominant period for high-end listings and sales; slowing way down for the mid-late summer doldrums; spiking back up for the short, intense autumn selling season; and finally plunging for the winter holidays.

Additional Chart: Marin 2017 Luxury Home Sales by City

Luxury Home Sales, Price Reductions
& Listings That Do Not Sell

This chart illustrates the difference between high-end listings the market deems appealing and fairly priced – on average, selling quickly for full list price – and those that have to go through price reductions prior to selling (on average, an extra 14 weeks on the market), and then those that do not sell at all, but expire and withdrawn from the market. The ratio of listings that do not sell – 1 expired listing for every 3 that sell – is much higher in the luxury segment than in the general market, and this has everything to do with both demand and pricing (or overpricing).

Rising Mortgage Interest Rates
Short-Term Trends

Long-Term Trends

Long-Term Mortgage Interest Rate Trends

Debt in America

One of the macro-economic factors of concern is that debt levels, of virtually every kind, are hitting new highs in the country (and in the world). This has been heavily subsidized by the historically low interest rates prevailing in recent years, but rates appear to be headed upward, and increasing debt often plays a big role in market cycles.

Debt Taken On to Invest in Financial Markets
(Often a Sign of Investor Over-Exuberance)

Household Non-Housing Debt
Credit Cards, Student Loans, Car Financing

Household Mortgage Debt Service Ratio

The amount of total mortgage debt in the country is now about the same as at its last peak in 2008 (not illustrated on this chart), but because of the plunge in interest rates since then, the ratio of mortgage debt service to disposable income was close to an all-time low in mid-2017. Interest rates have been rising since then, but are still about 30% lower than in 2007. The good news is that so much of mortgage debt in America is now in fixed-rate loans at very low interest rates, which adds much stability to economic conditions, a stability grievously lacking at the time of the 2008 financial markets crash.

Link to additional charts on debt

Additional reading for those interested:

Paragon Main Real Estate Reports Page
Positive & Negative Factors in Bay Area Markets
Survey of Bay Area Real Estate Markets
San Francisco & Bay Area Demographics

Please let us know if you have questions or we can be of assistance in any other way.

It is impossible to know how median and average value statistics apply to any particular home without a specific, tailored, comparative market analysis. In real estate, the devil is always in the details.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term. Late-reported MLS activity may change certain statistics to some small degree.

© 2018 Paragon Real Estate Group

A Survey of Bay Area Real Estate Markets

Our newly updated median home price maps for Marin, Diablo Valley & Lamorinda, and Wine Country markets in addition to San Francisco by neighborhood. To access them, click on the map image below and then roll your cursor over the maps on the webpage.

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Bay Area Q4 2017 Median House Sales Prices

San Francisco Bay Area Median Home Sales Prices

Bay Area 2017 Median Condo Sales Prices

San Francisco Bay Area Condo Median Prices

One cannot draw many conclusions regarding the new year market by looking at January data, whose low volume of sales mostly reflects offers accepted in December, however, so far, it appears that the low-inventory/ strong-buyer-demand dynamic is continuing in 2018. One recurring situation in recent years is that buyers jump back into the market in January in larger numbers than sellers getting their homes listed to sell – setting up a mismatch between supply and demand. Typically, many more listings will start pouring onto the market in February and March, and a much better idea regarding where the market is heading in 2018 will be possible once spring selling season data starts coming in.

Since questions constantly arise as to how one development or another is affecting or may affect Bay Area real estate markets – new tax laws, the high-tech boom, interest rates, financial markets, new home construction, climate change, and so on – our chief market analyst has made an attempt to identify and quantify the factors currently at play: Positive & Negative Factors in Bay Area Real Estate Markets

This report will focus on Bay Area trends, but other reports are available via these links: Marin County Market Report *** Marin Home Price Trends by City *** Sonoma County Report *** San Francisco Report

Year-over-Year Home Price Appreciation Rates
Comparing 2017 Median Sales Prices to 2016 Prices

San Francisco Bay Area Home Price Appreciation

Additional chart: Bay Area Median Home Price Appreciation since 1990

Average Dollar per Square Foot Values
& What You Get for $1 Million in the Bay Area

San Francisco Bay Area Dollar per square foot values

Your great aunt gives you a check for a million dollars to buy a home, so you go down to the real estate store to fill your cart. Below are some examples of how much home you would get for your money at 2017 average dollar per square foot rates: In Palo Alto, you could buy 626 square feet of home, and in Vallejo, 3817 square feet, with many other options in between.

Bay-Area_SqFt_for-1m_by-city.jpg

Bay Area Luxury Home Markets

Though San Francisco is a major player in luxury home sales, Silicon Valley – Santa Clara & San Mateo Counties together – has over 3.5 times as many homes selling for $2m and above. All 3 counties have similar average dollar per square foot house values in this high-price category. SF dominates the luxury condo market, and these condos, on average, sell at the highest per square foot values in the Bay Area. Marin, Alameda and central Contra Costa Counties have smaller luxury home segments, but you start to get more for your money.

Bay-Area_LuxHome-Sales_2m-plus_by-County.jpg

Market Dynamics Overviews

Bay-Area-All-Home-Sales-by-County.jpg

The decline in active listings available to purchase has played a significant role in pressurizing the market in recent years, especially as buyer demand has increased over the same period during which supply has dropped.

Bay-Area_Active-Listings_since-2012_NAR.jpg

Since median sales prices are so often quoted and compared, it adds context to look at the average size of houses in the different markets. (Comparing median prices to average sizes is not ideal, but you get the idea.)

Bay-Area_Avg-House-Size_by-County.jpg

New Housing Construction

This chart below from the November 2017 Housing Inventory Report issued by the SF Planning Department is for 2016, but illustrates how new housing construction in Alameda County has recently accelerated ahead of San Francisco and Santa Clara. Our larger analysis of this report, which focuses mostly on San Francisco, can be found here: SF New Home Construction Report

New-Construction_by-County.jpg

Days on Market, Overbidding Asking Prices
& Months Supply of Inventory

Bay-Area_Days-on-Market_by-County.jpg

Bay-Area_SP-OP-without-price-reduction.jpg

Bay-Area_MSI-Trends_SFD-Condo.jpg

Interest Rate Trends

Interest rate changes will certainly be one of the main factors to keep an eye on in 2018, as they play a huge role in housing affordability.

Short-term_30-Year-Rate-Trends.jpg

Bay Area Unemployment Rate Trends

Bay-Area_Unemployment-Rates.jpg

Bay Area Housing Affordability Trends

The CAR Housing Affordability Index, of which the trend lines since 1991 are charted below, estimates the percentage of households who can afford to purchase a median priced house in their county, based on a 20% downpayment. The big factors in this analysis are prevailing household incomes, interest rates, and, of course, quarterly median house sales prices. It should be noted that half of home sales are, by definition, below the median sales price, and that if one included condos in the equation, that would add substantially to affordability percentages.

For Q1 2018, the Index will attempt to factor in the effects of the new federal income tax law limiting mortgage interest, property tax and state income tax deductions, which will presumably reduce affordability percentages further. As seen below, many Bay Area counties are already getting close to historic lows, clearly one of our biggest social and economic challenges.

Affordability_Bay-Area-Counties_Chart.jpg

County to County, Metro Area to Metro Area
& State to State Migration Trends
Bay Area County-to-County Migration

Though people from all over the country and world migrate to and from the Bay Area, the greatest flow is actually between the local counties themselves. In net migration numbers, amid all the back and forth, people are, generally speaking, flowing from the core, most expensive counties to adjacent, somewhat less expensive counties, and then to even more affordable counties outside the inner Bay Area. However, the inner core counties, where the high-tech boom has been most concentrated, attract significant immigration from outside the Bay Area, state and U.S., which is why their population numbers have continued to grow. Note: This chart does not include Santa Clara County, though much of its migration patterns can be seen in the data of the other counties.

Bay-Area_County-to-County_Annual-Migration.jpg

U.S. Metro Area to Metro Area Migration

This chart pertains to immigration in and out of the 5-county San Francisco metro area, which does not include Santa Clara to its south. Between U.S. metro areas, more people are leaving the SF metro than arriving, but that deficit has been more than made up for by substantial numbers of foreign immigrants. These numbers, however, pre-date the much more hostile view of immigration by the current administration, so we will have to wait and see what effects derive from that change. Looking at net metro-area migration, more people come to the SF metro area from Santa Clara County, Southern California, New York, Chicago and Boston. And more peopleleave the SF metro area to go to other (less expensive) CA counties east and north of the Bay Area, and to metro areas in Texas, Nevada, Oregon and Washington State. The exodus is made up of both people changing jobs, and retirees, though they tend to go to different places.

Bay-Area-Migration-Trends.jpg

If you want to read about state to state migration patterns, our recent article is here: California Migration Trends

All our Bay Area reports and articles can be found here: Market Trends & Analysis

One of our recent and popular reports: San Francisco & Bay Area Demographics

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices can be and often are affected by other factors besides changes in fair market value, and longer term trends are much more meaningful than short-term. It is impossible to know how median prices apply to any particular home without a specific comparative market analysis. All numbers in this report are to be considered approximate.

© 2018 Paragon Real Estate Group

Marin Real Estate – New Year Report

Another strong year in real estate, with continued median home price appreciation in Marin, and indeed throughout the Bay Area.

Marin, SF, CA, National Home Price Trends

Marin Median Home Price Trends by Year

Additional chart: Bay Area Median Home Price Trends by County

The chart below, based on CoreLogic S&P Case-Shiller Index data, tracks general price appreciation trends of house in the upper third of prices in the 5-county SF Metro Area (such as those mostly found in SF, Marin, San Mateo and Diablo Valley-Lamorinda). Case-Shiller does not base their calculations on median sales price changes but uses its own proprietary algorithm. This chart has been simplified to only reflect percentage increases and decreases from various points in real estate cycles. Since it covers 5 counties, it is a very generalized illustration.

Case-Shiller San Francisco Bay Area Home Price Trends

Link to our full report on the Case-Shiller Home Price Index

Link to our report on Bay Area real estate cycles

Moving into 2018, there are a lot of spinning plates in the air – local, state, national and international factors that could affect markets. 2017 saw real estate markets surge and financial markets soar. After some cooling from mid-2015 to mid-2016, the Bay Area high-tech economy surged back into high speed, with companies leasing enormous spaces in newly built office buildings – which they will presumably fill with new hires. Unemployment rates have flirted with historic lows, and 2018 may see some major local IPOs, which could create great quantities of new wealth. The Bay Area still has probably the most dynamic, innovation-fueled economy in the world and indisputably remains among the great metro areas on the planet – but there are social, economic, political and environmental challenges looming as well.

Congress delivered an unpleasant holiday present to many Bay Area residents in the form of federal tax law changes limiting the deductibility of mortgage interest and state and local taxes. The effect of these changes make living in an already high cost-of-living area more costly for many residents, and also reduce some of the financial incentives of homeownership, especially for more expensive homes. Predictions on the effect of these tax changes on local housing markets and the business environment range from one extreme (economic devastation) to the other (shrug), and the state legislature is currently working on bills that might blunt the negative financial impacts. It is too early to guess how it will all play out. We live in interesting times.

This report will review real estate trends in 2017, and some of the economic factors that impacted them. Most of the charts are self-explanatory, so we have kept the text to a minimum. Towards the end is an extensive analysis of home prices by city and by bedroom count.

Marin year over year home price appreciation

Marin Annual Homes Sales Volume

Marin County Sales by City

Marin real estate market seasonality

Marin Homes Selling Quickly

Marin Average Days on Market by Year

Marin Sales Price to List Price Percentage

SF Bay Area Months Supply of Inventory

California Migration Trends in 2016

Link to our analysis of domestic and foreign migration trends

Link to our survey of Bay Area demographics

S&P 500 Index by Year

Annual Mortgage Rate Trends

Marin County Housing Affordability

San Francisco Bay Area Rent Trends

 

Marin Luxury Homes Market

Marin Luxury Home Sales by City

Marin Luxury Home Sales by Year

Marin County Home Prices by City & Bedroom Count
Best Places to Look for a Home in Your Price Range

Marin homes under a million dollars

Marin Homes under 2 million

Marin 2-bedroom house sales by city

Marin 3-bedroom house prices by city

Marin 3-bedroom house prices - B

Marin 4-bedroom home prices

Marin 5-bedroom home prices

Marin 6-bedroom home prices

Drilling down beyond the general statistic of median sales price, these charts give a better idea of how likely one is to find a home of a particular size within a price segment in specific Marin County cities.

Tiburon Belvedere home prices

Mill Valley Sausalito Home Sales

Ross Kentfield Larkspur Homes Sales

Corte Madera Greenbrae Homes Sales

San Rafael Anselmo Fairfax home sales by price range

Novato home sales by price

Marin condo sales by city

Marin 2-bedroom condo sales

Marin 3-bedroom condo sales

All our Bay Area real estate analyses can be found here: Paragon Market Reports

Please let me know if you have any questions, or if I can be of assistance in any way. Wishing you and yours a safe, healthy, happy and prosperous New Year!

It is impossible to know how median and average value statistics apply to any particular home without a specific, tailored, comparative market analysis. In real estate, the devil is always in the details.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term. Late-reported MLS activity may change certain statistics to some small degree.

© 2018 Paragon Real Estate Group

What You May Not Know about Marin & the San Francisco Metropolitan Area

While waiting for final data on the feverish 2017 real estate market to arrive, we thought to step back from homes and, instead, look at the people who live in them. Compiled solely for your entertainment and, perhaps, mild edification.

Depending on data source, these analyses pertain to either Marin County alone, or to a multi-county San Francisco Metro Area, as delineated on each chart.

Our latest analyses of the Marin real estate market can still be found here: Marin Market Report

Ethnicity, Race & Ancestry

Religious and Spiritual Practices & Beliefs
Bay Area Statistics

Education and Income by Education

Employment, Wages & Commuting

The Bureau of Labor statistics analyzes average annual wages for over 700 local occupations in the Bay Area. Below is a sampling of approximately 50 of them.

Spending Money
Bay Area Statistics

Voting

The Ages of Marin

Marin Land Use

Marin Housing Affordability Trends

Selected Statistics by Marin County ZIP CODE

Income, Age, Education & Foreign Birth

Unsurprisingly, degree of education correlates strongly with household income figures.

How Americans Spend the Hours of Their Days
National Statistics

The data herein is from a wide variety of third party sources deemed reliable – much of it from national, state and local government data sources – but it may contain errors, and is subject to revision. When the term San Francisco Metro Area is used, it signifies that the data includes multiple Bay Area counties, however different organizations sometimes vary in which counties they include in that description. If different sources disagreed, we chose the data we thought most reasonable. Different analyses often pertain to somewhat different time periods. All data should be considered approximate or good-faith estimates.

© 2017 Paragon Real Estate Group

Marin County Home Prices & Market Trends

2017 has been a high demand, low supply market in Marin and throughout the Bay Area, with median sales price increases pretty much across the board. As mentioned in earlier reports, the greatest pressure of buyer demand has generally been focused on the more affordable market segments, as defined within each overall county market. The recent terrible fires in the wine country will only add to pressures on both the resale and rental markets in the county, especially in its northern communities. Typically, and we will see how it plays out this year, the market begins to go into hibernation just before Thanksgiving and does not really wake up until mid-January – this is especially true of higher-end home segments – but the mid-winter slowdown period can be a good time to buy, as we discuss further in this report.

Median Home Price Appreciation Trends
for Selected Cities & for the County Overall

Average Dollar per Square Foot Trends
for Selected Marin Cities & Towns

Let us know if you would like trend data on a city or town not included on the charts above.

This chart below based on CoreLogic S&P Case-Shiller data compares the appreciation of the more expensive Bay Area home markets (blue line) – such as most of Marin, San Francisco and San Mateo – to the overall national trend (green line), going back to 1987. It is interesting to see where our local appreciation rates have diverged from national rates: The divergence since 2012 has been particularly striking.

Note that the numbers on this chart all refer to a January 2000 price of 100. So, the latest Bay Area reading of 238 means that home prices here have appreciated, according to Case-Shiller, by 138% since January 2000. National home prices appreciated by 95% during that period.


 


 

Market Overviews
The largest market segment in Marin is that for 3-bedroom houses.
(In San Francisco, the largest segment is of 2-bedroom condos.)


 


 

Luxury Home Sales

Luxury home markets generally cooled around the Bay Area from late 2015 to autumn 2016 – due to all the financial market volatility (Chinese stock market crash, oil price crash, Brexit) and political uncertainty during that period – but recovered in 2017, just as the stock market has surged dramatically higher since the presidential election.


 


 

Market Statistics by City & Town

Corte Madera, Greenbrae and Larkspur continue to occupy the sweet spot in the Marin market due to a number of issues, including the combination of being less expensive than some adjacent communities, and having easier commutes to the city than more affordable towns and cities further west or north. (Of course, they are also lovely places to live, but that applies to just about anywhere in the county.) Note that market heat is a matter of degree: Almost every community market in Marin is very strong when compared to historical trends. The statistics of several other cities and towns are very close to those of Corte Madera, Greenbrae and Larkspur, and small differences are not particularly significant when working with general analyses such as these below.

As noted on several of the charts, it is not unusual for the highest priced markets to have somewhat softer statistics: The pool of qualified buyers is much smaller, and luxury homes are typically more prone to overpricing, both of which affect buyer response, time on market and so on.

Months Supply of Inventory (MSI)
The lower the MSI, the stronger the demand as compared
to the supply of home listings available to purchase. Most of
these MSI readings are very, very low .

Percentage of Listings Accepting Offers
The higher the percentage the hotter the demand.
Most of these percentages are very, very high.

Average Days on Market
Generally speaking, the fewer the days on market, the stronger the demand.

Market Heat by PRICE SEGMENT
as Measured by Months Supply of Inventory


 


 

Seasonality & the Real Estate Market
Listing activity, buyer demand and price reductions
all ebb and flow dramatically by season.

Advantages to Buying during the Mid-November to Mid-January Slowdown

Just before Thanksgiving the market typically begins to rapidly subside until starting to revive about 7-8 weeks later. Many buyers simply check out during this period, but there are good reasons for staying engaged – mainly the possibility of getting a much better deal. In late October and November, sellers begin reducing prices in large numbers as they try to capture the attention of buyers before the big slowdown: Buyers should treat these as brand new listings and take a new look. Competition between buyers drops dramatically during the mid-winter period, and since competitive bidding is the biggest single factor behind higher prices, its decline can mean significant savings. Fewer buyers also mean that sellers are often more willing to negotiate: Throw offers in at whatever price you feel is right and see where they go. It is true that the number of new listings coming on markets plunges, but there are still hundreds of listings to consider for those willing to stay in the game.

It is unclear at this time, how the wine country fires may affect market dynamics during what is usually by far the slowest season of the year.


Three Suggestions: As recent events have reminded us, disasters can arrive suddenly and with little warning, so: 1) Contact your insurance agent to make sure your policy is updated to cover the full, current value of your home and possessions. 2) This website contains useful information on being prepared and having a plan in the event disaster strikes: Disaster Preparation Guide & Resources. 3) Many communities now have early-warning communications programs that can automatically email, text or call you in the event of a disaster, and then provide useful ongoing updates on the situation. Check with your county and city governments to see what is available, and sign up ASAP.

Please let us know if you have questions or we can be of assistance in any other way. We have dozens of other analyses specific to the Marin County real estate market.

All our Bay Area real estate analyses can be found here: Paragon Market Reports


It is impossible to know how median and average value statistics apply to any particular home without a specific, tailored, comparative market analysis. In real estate, the devil is always in the details.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term.

© 2017 Paragon Real Estate Group

Marin Real Estate Report – October 2017

Before talking about real estate, which does not seem very important in light of the terrible fires in the wine country, here are a number of ways to help, if you wish to do so. It is not a complete list.

Donate to Red Cross
Airbnb Open Homes Program
Napa County Disaster Relief
Go Fund Me Fire Relief Campaign
Sonoma Humane Society
Napa Humane Society
Other Ways to Help

Marin Median Home Price Trends since 1990

Marin County Median Home Price Trends

Marin Average Dollar per Square Foot Values by City
2017 YTD Sales

Marin County Average Dollar per Square Foot Values

Q3 Comparative Statistics, 2014 – 2017

Inventory slightly down, sales up, and home values increased
year over year in Q3 2017.

Marin County Q3 Market Statistics

Sales Prices to List Prices, Days on Market & Price Reductions
Home Sales under $2 Million

Marin Sales Prices to List Prices

Those listings buyers deemed fairly priced sold quickly and, on average, for 3% over asking price. Listings that had to go through price reductions prior to sale spent 2 months longer on the market and sold at a significant discount to original list price. And then some listings expired and were taken off the market without selling, typically due to buyer unwillingness to pay the price asked.

Marin Luxury Home Market

For the first time, Tiburon has taken the lead in number of luxury homes sold.

Marin Luxury Home Sales by City

As is always the case in real estate, what one gets for the price paid
varies dramatically by location, as shown by these average $/sq.ft. values.

Marin Luxury Homes Average Dollar per Square Foot

Q3 2017 was unusually strong for Marin luxury home sales
(though Q2 is still the biggest quarter of the year in the luxury segment).

Marin Luxury Home Sales Statistics

Overpricing Marin luxury home listings has very negative ramifications
for final sales prices, average days on market, or whether the listing sells at all.

Marin Luxury Home Sales Prices to List Prices

Context Economic Factors to Bay Area Housing Markets

Market-Context-Tile_V2.jpg

We recently completed a report placing the Bay Area housing market within the context of a wide variety of other economic and demographic dynamics, such as population growth, employment and hiring, the stock and the IPO markets, consumer confidence, interest rates, commercial lease rates, aging homeowners (who sell less frequently), housing affordability and new housing construction. Because conditions, trends and cycles seen among them are, more often than not, closely interrelated. In some of these analyses we use San Francisco data due to its availability, but the trends generally apply to Marin County as well (except for new home construction: among Bay Area counties, Marin is at the back of the pack on this metric).

The full report is online here: Economic Context Report.

Median Home Price Trends by City

Median sales price is a very general statistic, and changes in median price do not necessarily correspond exactly to changes in fair market value, as it can be affected by a variety of factors. Cities with relatively few sales and wide ranges in individual sales prices are most prone to less meaningful fluctuations: Their values can shift simply due to the specific basket of larger or smaller homes sold in a particular period.

The charts below are arranged in order of 2017 YTD median house sales price, highest to lowest. Remember that median sales prices typically disguise a large variety of prices in the underlying individual home sales. They are best used as a comparative value statistic between areas, and to discern longer term trends in appreciation.

Marin County Belvedere Median Home Price Trends

Marin County Ross Median Home Price Trends

Marin County Tiburon Median Home Price Trends

Marin County Kentfield Median Home Price Trends

Bolinas Stinson Beach Median Home Price Trends

Sausalito Median Home Price Trends

Marin County Larkspur Median Home Price Trends

Marin County Greenbrae Median Home Price Trends

Mill Valley Median Home Price Trends

Marin County Corte Madera Median Home Price Trends

Marin County San Anselmo Median Home Price Trends

Marin County San Rafael Median Home Price Trends

Marin County Fairfax Median Home Price Trends

Marin County Novato Median Home Price Trends

San Geronimo Valley Median Home Price Trends

Please let us know if you have questions or we can be of assistance in any other way.

All our Bay Area real estate analyses can be found here: Paragon Market Reports

It is impossible to know how median and average value statistics apply to any particular home without a specific, tailored, comparative market analysis. In real estate, the devil is always in the details.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term.

© 2017 Paragon Real Estate Group

Another Hot Autumn RE Market?

After the usual late summer slowdown, the typically very active autumn selling season is relatively short, running from mid-September until mid-November, when activity begins to plunge for the mid-winter holidays. The coming two months will be the next major indicator: Will the Marin homes market continue to maintain the intense high-demand, low-supply heat of this past spring, or will it start to shift and cool? While the entire market is significantly affected by seasonality, the luxury home segment is fiercely so, and September/October will be the peak selling period for high-end homes until spring 2018 rolls around.

Marin County, San Francisco, California
& United States Median Home Price Trends

The appreciation of home prices in the Bay Area since 2011 has out-performed overall state and national markets by a substantial margin.

Marin County, California, US Home Price Trends

Marin Market: Year-to-Date Snapshot

Marin County Home Sales and Prices

Marin Median House Price Appreciation
Percentage Increases, 2012 to 2017 YTD

Median sales prices are not perfect indicators of changes in values for specific homes: They can be and often are affected by factors other than changes in fair market value, and shorter-term anomalies are not uncommon. In the more expensive communities especially, the average size of houses sold in a particular period can sometimes vary considerably. What is certainly true is that every part of Marin County has seen large-scale appreciation since the recovery began in 2012.

Marin County Home Price Appreciation

Seasonality
New Listings Coming on Market

This next chart illustrates the striking ebb and flow of activity by season. September usually sees the last big surge of new listings hitting the market before the year ends, and that surge fuels most of the sales in the autumn season.

Marin New Home Listings

Marin Luxury Home Market
Active Listings by City

Spring sees the highest volume of luxury home listings, but after declining for the summer, they usually spike again in September. This chart also delineates the city markets that dominate high-end home sales volume in Marin: Tiburon-Belvedere has the highest number of houses for sale at $2m and above, sometimes exceeding 60 active listings in a given month; next comes Mill Valley and Kentfield-Ross; then San Rafael and Sausalito; and finally a few cities and towns which usually have no more than a handful or two of such listings at any given time. (This chart does not include a few other towns with lesser activity in this segment.)

Marin County Luxury Home Listings

Market Dynamics Statistics
Sales Price to Original Price (SP-OP) Percentages
The Marin Market & Overbidding Asking Prices

Generally speaking, the higher the demand, the greater the competitive bidding, which is what leads to sales prices going over asking prices. Almost all the SP-OP percentages in the area during the feverish Q2 market were high by historical standards. It is not uncommon for more expensive home markets to have lower SP-OP percentages than the more affordable cities, but there are a number of factors at play.

Marin County Overbidding List Prices

Months Supply of Inventory (MSI)

The lower the months supply of inventory, the higher the demand as compared to the supply of homes available to purchase, i.e. a lower MSI equals a hotter market. The entire Bay Area has been experiencing very, very low MSI figures recently, but typically the less expensive inner counties (such as Alameda and Contra Costa) have been seeing the extreme lows, with more expensive markets somewhat higher.

Within Marin, the MSI in the more moderately priced communities, usually experiencing the highest pressure of buyer demand, have generally been lower than in the more expensive cities, though all areas have seen low MSI figures since spring began.

Marin County and Bay Area Months Supply of Inventory

National Housing Affordability

This next chart illustrates home affordability for selected metro areas across the country as calculated by the National Association of Realtors. The 7 Bay Area counties, in our 2 metro areas, are the least affordable in the nation – not the happiest of distinctions, except for those planning to sell and move out of the area.

U.S. Metro Area Housing Affordability

Bay Area House Markets

Since San Francisco is considered the big city in the Bay Area (though San Jose is actually larger), it seems counter-intuitive that its house market is one of the smallest. Marin is just slightly lower, even though its population is about 70% less. Owners in the Bay Area (and the nation) are getting older, and selling their houses ever more infrequently, and new house construction has lagged well behind demand. Condo sales now dominate the SF market. These are major factors behind the supply and demand dynamics prevailing in counties around the Bay Area.

Bay Area House Markets

Bay Area Home Price Appreciation
per the S&P CoreLogic Case-Shiller Index

Earlier in this report, it was mentioned that median price changes can be somewhat unreliable as exact indicators of appreciation of fair market value. However, the S&P Case-Shiller Home Price Index measures appreciation using its own special algorithm tracking resales of the same home. This first chart below, based on Case-Shiller, is a simplified, smoothed-out look at the up and down cycles over the past 33 years in the higher end of the Bay Area real estate market, which predominates in much of the city, Marin, San Mateo, as well as enclaves in Alameda and Contra Costa. Because the Index covers 5 counties, it merges the differences between their separate markets into a single trend line: SF and San Mateo, the centers of the high-tech boom have recently, in this latest rebound, had somewhat higher appreciation rates than Marin. However, as indicated earlier, Marin has still seen very dramatic increases since the recovery began.

San Francisco Bay Area Home Price Cycles

This second Case-Shiller chart illustrates how homes in different price segments around the Bay Area have recently been appreciating at considerably different rates. C-S divides all the Bay Area house sales into thirds by number of sales: low-, mid- and high-price. As illustrated in the lower green line, the higher-priced segment went flat in appreciation in 2016, but then jumped back to life in 2017. The most affordable price segment (top blue line) has been experiencing the highest pressure of buyer demand and competitive bidding, and since April 2016, has out-appreciated the high-price segment, 12.4% to 4.3%, i.e. almost triple the rate of increase. The mid-price segment (gold line) has been in between, appreciating by 7.8%.

This dynamic is generally true within each county, as well as in the Bay Area as a whole, as buyers search for homes they can still afford in the area they wish to live.

The numbers on this chart all refer to a January 2000 home price of 100. Thus 262 signifies a price 162% higher than in 2000.

Case-Shiller SF Home Price Trends by Price Tier

Mortgage Interest Rates

Since the election, interest rates have seen a wild ride, first up and then down. As of the end of August, rates hit their lowest point so far in 2017, a significant financial advantage for buyers.

Mortgage Interest Rate Trends

Please let us know if you have questions or we can be of assistance in any other way.

All our many Bay Area real estate analyses can be found here: Paragon Market Reports

It is impossible to know how median and average value statistics apply to any particular home without a specific, tailored, comparative market analysis. In real estate, the devil is always in the details.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term.

© 2017 Paragon Real Estate Group

1000+ Things to Do and Enjoy in Marin, the Wine Country & San Francisco

Out of town guests are arriving, the kids are hungry, the dog is restless, or you are just lying on the couch hoping for something to motivate you to get up and out of the house.

Food, drink, music, dance, yoga, biking, hiking, weekend getaways, meditation retreats, and things to do with visitors, children and dogs.



Food & Drink

Best of Marin Food
Best Marin: 2nd Opinions
Best Drinks in Marin
Essential Sonoma Restaurants
More Sonoma Restaurants
Hottest Napa Restaurants
Hottest SF Restaurants
Zagat’s 50 Best SF Restaurants
Best SF Brunch
Best SF Burritos
Best SF Dim Sum
Best SF Wine Bars



Out & About

Things to Do in Marin
To Do in Marin with Kids
Marin Yoga, Dance & Music
Best Marin Shopping
101 Things to Do in Sonoma
In Napa & Sonoma
Sonoma Outdoors
Things to Do in SF
With Kids in SF
To Do in Oakland
8 Unique Day Trips
Weekend Getaways
Meditation Retreats
Bike Rides
Mountain Biking
SF City Walks
15 SF Stairways
Marin County Parks
10 Best Marin Day Hikes
Bay Area Hikes
Places to Kayak
Bay Area Festivals
Professional Sports



Arts & Entertainment

Bay Area Home Prices, Incomes & Demographics

Which counties are most expensive or most affordable, have the highest overbidding and appreciation rates? Which are healthiest, most educated, have the highest incomes or worst poverty percentages? What cities have the biggest, most expensive homes? And where do Bay Area residents come from?

August 2017 Report

Median House Price Appreciation since 1990

Appreciation trend lines are largely similar across the Bay Area, but some counties have outperformed others. Solano is still well below its previous peak price ten years ago, and Sonoma and Napa are just now coming back up to their previous highs. Most of the other counties have exceeded their 2006-2007 peaks, sometimes by very wide margins. As will be explored further below, proximity to the heart of the high-tech boom has been one of the major factors in recent appreciation rates. Still, it is worth noting that in the past year and a half, appreciation rates in less expensive towns and neighborhoods have typically been higher than in more expensive areas, an indication of the sometimes desperate search for affordable housing – however that might be defined within the context of any given market.

Average Dollar per Square Foot Values

The Most Expensive Places in the Bay Area

By clicking on map, you can also access our full collection of home price maps delineating current city home prices throughout the Bay Area.

Note: Diablo in Contra Costa with 6 sales at a median price of $2.73m, and Penngrove in Sonoma with 13 sales at a median price of $919,500, had higher prices than Alamo and Healdsburg in the period measured, but because of their very low number of sales, we highlighted the larger markets on the map above.

Annual Home Price Appreciation Rates (since 1996 and 2011)

This table below illustrates annual compound appreciation trends going back to the post-recession recovery that began around 1995, and also from the current post-2008-crash recovery which started in 2012. This is based upon someone purchasing their home all cash: If one had purchased with a 20% down payment, then the annual compound rate of appreciation of that cash investment would be much, much higher.

There are 3 big factors behind local appreciation rates: 1) the emergence of the Bay Area in the past 20 years as an international, economic powerhouse, which generally lifted all markets, 2) how close the specific market is to the white-hot centers of the high-tech boom (SF and Silicon Valley), and, 3) how badly the county was hammered by the foreclosure crisis, since those markets whose prices fell 50% or more to unnatural lows bounced back more on a percentage basis than those counties less affected by the subprime catastrophe.

SF has had the highest compound annual rate since 1996: It is the epicenter of the Bay Area high-tech, bio-tech and fin-tech economic miracle. But Oakland soars above all other markets in appreciation since 2011, because of a combination of factors: It is the closest affordable alternative to much higher SF prices; it is a lively, multi-cultural urban area appealing to high-tech workers; and its housing prices dropped an astounding 60% after the 2008 crash, which set them up to fly upward once the heavy anchor of distressed property sales was removed.

Having complete confidence in our ability to predict what will happen in the past, we now recommend that all our clients go back in time to 1995 or 2011 and buy as many homes as possible.

Economic & Demographic Factors

Underpinning the Bay Area real estate market and general economy are often amazing, but sometimes worrisome statistics. Below are tables and charts ranking counties, zip codes and cities by a variety of parameters. The Bay Area ranks extremely high in income, education, employment rates and general health factors, often grabbing almost all the top rankings, but it is also unhappily high in income inequality, housing unaffordability and poverty.

Bay Area City & Zip Code Income Rankings

Atherton has the highest median household income and the highest median income per worker in the state, followed by a handful of other nearby, highly affluent, Silicon Valley communities. In San Francisco, South Beach and the Presidio zip codes make the top rankings, but note that several of the most expensive neighborhoods in SF are in zip codes that mix highly affluent with less affluent areas (such as Pacific Heights and Western Addition, or Russian Hill and the Tenderloin). SF also has much higher percentages of residents who are tenants, and generally speaking, renters have lower incomes than homeowners.

In Marin County, Belvedere, Tiburon, Kentfield and Mill Valley make the lists; in Contra Costa, the Diablo Valley & Lamorinda communities of Blackhawk, Alamo, Lafayette, Orinda and Moraga rank highest; in Alameda, Piedmont is in the top 10 cities for median worker earnings.

Bay Area zip codes utterly dominate the CA rankings for higher education, taking 14 of the top 15 spots out of about 2600 zip codes. Unsurprisingly, high positions in income usually correlate with the same in education (and having UC Berkeley and Stanford in our midst was a help): Top Zip Codes for Higher Education

If you wish to explore Bay Area rankings by other criteria: Top 25 Rankings in California

Employment & Unemployment

High-tech employment in SF & San Mateo Counties illustrates broader trends in hiring: massive growth and some recent cooling.

Unemployment rates are bumping against historic lows.

Bay Area Poverty Rates & Housing Affordability

Beneath surging affluence, significant percentages of county populations are living in poverty. High housing costs are a big factor.

Housing affordability percentages are approaching historic lows in some counties,
a huge Bay Area political, economic and social issue. If interest rates start to go up
considerably, the picture will worsen, but so far they have remained quite low.Link to our mortgage interest rate chart
Link to our full report on Bay Area housing affordability

Bay Area Luxury Home Markets

Santa Clara is by far the biggest luxury home market in the Bay Area by the number of homes selling for $2m+, but then its overall market is also the largest, more than 2½ times larger than that of San Francisco. Average dollar per square foot values for luxury house sales are surprisingly similar across Santa Clara, San Mateo and San Francisco, with Marin County just a notch lower. Moving further out, one gets considerably more luxury house for the money.

Generally speaking, SF luxury condos and co-ops command the highest dollar per square foot values in the Bay Area: Think fabulous units on high floors of prestige, ultra-amenity buildings with absolutely staggering views.

Calculating luxury markets by the top 10% of sales, the thresholds for the luxury designation vary widely: For example, in Sonoma, the threshold is about $1,125,000 for houses, while in San Francisco, it is about $3m.

Other Angles on Bay Area Market Dynamics
Bay Area Condo Markets

Overbidding

Average Days on Market

Bay Area Market Sizes

Bay Area Rents

Rents are even more sensitive to hiring trends than home prices.Link to our apartment building market report

Additional Demographic Snapshots

The foundation of the Bay Area economy is a richly multi-cultural society constantly infused by many of the best and brightest from around the world.

S&P Case-Shiller Home Price Index for the San Francisco Bay Area

Case-Shiller charts are complicated, which is why we have put them at the end of the report, but they do give perspectives on home price appreciation by price segment. The different price tiers had bubbles, crashes and recoveries of very different magnitudes, with the low-price tier having an extravagantly enormous subprime bubble and a disastrous crash, while more costly home tiers having lesser bubbles and crashes. The end result now is that all three tiers are relatively close in their current prices as compared to 2000 values, but are in very different circumstances when compared to their 2006-2007 bubble peaks. Around the Bay Area, generally speaking, San Francisco, San Mateo, Marin, Santa Clara and Diablo Valley-Lamorinda have high-price tier markets with smaller mid-price segments; Alameda, Sonoma, Napa, Solano and non-central Contra Costa have mixes of low-price and mid-price markets (though there are, of course, pockets of high-price homes as well).

All C-S data points refer to a January 2000 home price of 100. Thus a reading of 250 signifies a price 150% higher than in January 2000.

More affordable homes have been appreciating much more quickly in the past 15 months than more expensive price segments.

Link to our full S&P Case-Shiller Index Report

All our reports, including dedicated analyses of the SF luxury home segment, and of the Marin, Sonoma and Diablo Valley-Lamorinda markets, can be found here: Market Trends & Analysis

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in the Bay Area, each with its own unique dynamics. Median prices can be and often are affected by other factors besides changes in fair market value, and longer term trends are much more meaningful than short-term. It is impossible to know how median prices apply to any particular home without a specific comparative market analysis. All numbers in this report are to be considered approximate.

© 2017 Paragon Real Estate Group

Marin County Real Estate – The Paragon Mid-Year Report

After another feverish spring market, the Marin County median house price hit a new quarterly peak in Q2 2017, $82,000 above the high hit in Q2 2016. This dynamic was prevalent around the Bay Area.

And as illustrated in the chart below, luxury home sales also hit a new peak, rising 17% above the number of sales in Q2 2016. It is not unusual for luxury home sales to hit their highest numbers of the year in Q2, reflecting the spring sales season, and this is one of the factors behind the increase in median sales price.

A Very Hot Spring

Median Sales Price Appreciation
by Quarter since 2012

Luxury Homes Sales
by Quarter since 2014



Home Price Maps

We have just updated our median home price maps for the Bay Area, San Francisco, Marin County, Diablo Valley & Lamorinda, and the Wine Country. To access them, click on the map image below and then roll your cursor over the maps on the webpage.



Home Prices by City & Bedroom Count

Breaking Down Sales by Price Segment

Median sales prices typically disguise a wide range of prices in the underlying individual home sales, which is what these charts illustrate.

Building Cranes Everywhere in San Francisco

If you have recently been in San Francisco and have wondered at the amount of construction currently underway and planned, here is a brief summary: Approximately 64,000 housing units, 31 million square feet of commercial space and 25 hotels with 4685 rooms are now in the SF new construction pipeline. 5700 housing units, 10 million square feet and 5 hotels are currently under construction. The city is in the midst of one of its biggest building booms in history. Note that if economic conditions change, planned projects can change very quickly as well.

Bay Area Rent Trends

San Francisco still has the highest rents in the nation (the light blue columns in the chart above), exceeding even Manhattan (in second place, delineated by the dark blue line), but they have been dropping since recent peaks in late 2015/early 2016. Generally speaking, rents around the Bay Area have either declined, in what had been the hottest markets, or seen their appreciation rates significantly slow, over the past year or so. The Marin rent-price trend line is very similar to the San Mateo line.

Please let me know if you have questions or I can be of assistance in any other way.

All our Bay Area real estate analyses can be found here: Paragon Market Reports

It is impossible to know how median and average value statistics apply to any particular home without a specific, tailored, comparative market analysis. In real estate, the devil is always in the details.

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in San Francisco and the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term.

© 2017 Paragon Real Estate Group