Kyle Frazier, J.D., Broker Associate Ι Pacific Union International | Christies International Real Estate | (415) 350-9440

Marin County, California, Luxury Homes Report (October 2009–Sales and Inventory Analysis)

In our New Economy, real buyers have become less numerous and have placed increased emphasis on prestige locations, views, lifestyle amenities (usable yards, proximity to clubs/shopping, etc.), schools, and sensible scale. As reported all year, the luxury segment remains weighted towards homes priced under $3 million — although 4 homes priced over $4 million sold in October 2009. First and foremost, the economy must give reason for optimism and the stock market must continue to win back gains lost over the past year. Once some of those gains are recaptured, affluent buyers will feel more comfortable with major purchases again.

Meanwhile, the media has been placing a positive spin on economic news coverage, which will hopefully result in a positive feedback loop. For example, a story run in the A.P. last week noted that economic forecasters are predicting that 2010 will be the first year since 2005 for housing to contribute to the growth of the U.S. economy (based on a survey by the National Association for Business Economics). According to that organization, home prices are expected to rise 2 percent next year and over 80 percent of economists surveyed by the NABE think the recession is over and recovery has begun. In addition, the San Francisco Chronicle ran a story last week regarding how low interest rates have spurred a modest increase in Bay Area home sales in September. Also concurring with the expectation of growth is the Mortgage Bankers Association Chief Economist Jay Brinkmann, who predicts that sales of existing homes will rise 11 percent in 2010, with sales of new homes climbing 21 percent.

For a detailed snapshot of current national trends from the Institute for Luxury Home Marketing, click HERE. And if you would like a hyper-local report relating to any town or zip code in Marin or San Francisco, call me at (415) 350-9440.

The below graph tracks asking prices for 3 “hot” locales in Marin — Tiburon/Belvedere (they are combined here because they use the same zip code), Mill Valley, and Kentfield. Interestingly, while Belvedere continues to see asking prices drop, Kentfield and Mill Valley have seen asking prices increase over the 120 days. Of course, asking prices do not necessarily closely reflect selling prices and in Mill Valley, there are lots of homes on the market in the higher price bands, which have not sold.

The year over year inventory levels in Mill Valley have hovered at around 20% higher than last year for 6 months. Meanwhile, inventory in Kentfield is up 80% and Tiburon / Belvedere inventory levels are over 90% higher than last year.

Below is a new chart focusing on the percentage of homes that have experiencd price reductions and the depth of those price reductions, on average. This chart examines these trends in Mill Valley and in Belvedere / Tiburon. It is perhaps not surprising that nearly 45% of listings in Tiburon / Belvedere have experienced a price reduction and those reductions average about 12%.

Real Estate Market Chart by Altos Research www.altosresearch.com

$2 Million to $4 Million Luxury Homes

Heading into the Fall, it is generally expected that sales will wane. Yet, buyer activity has picked up significantly. The number of homes in escrow in this price band is up 33% from last month. It seems that there is a lot of home shopping going on as patient buyers have begun snapping up homes. I expect that next month will see a large surge of sales. Inventory remains low with 128 homes on the market between $2 million and $4 million.

Cities recording sales in this price band included: Tiburon (1), Mill Valley (3), Kentfield (2), and Sausalito (1). These homes averaged 113 days on market. Their average sales price was $2.683 million (roughly $813 per square foot), with an average of 3,340 square feet. The absorption rate for Marin homes in this price band is about 18 months.

$4 Million & Up Ultra-Luxury Homes

The inventory level of Marin County’s ultra-luxury market (homes priced in the $4 million and up range) remained virtually unchanged with 53 homes for sale. The highest concentrations of homes in this price band are Tiburon, Belvedere, Sausalito, and Ross. As noted earlier, Marin County experienced 4 sales last month, doubling the previous month’s output.

By: Kyle Frazier, Certified Luxury Home Marketing Marketing Specialist (CLHMS), Certified Residential Specialist (CRS), Broker Associate, Realtor | Christie’s Great Estates — Morgan Lane International. Call Kyle Frazier at 415/350-9440 for more luxury home market information in San Francisco and Marin Counties.

Marin County, California, Luxury Homes Report (September 2009–Sales and Inventory Analysis)

Earlier this month marked the one-year anniversary of the beginning of the equities market meltdown, which profoundly impacted Marin County, California’s luxury real estate market. In our New Economy, real buyers have become less numerous and have placed increased emphasis on prestige locations, views, lifestyle amenities (usable yards, proximity to clubs/shopping, etc.), schools, and sensible scale.

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As reported all year, the luxury segment remains weighted towards homes priced under $4 million — while we had 3 sales of homes priced over $4 million in July 2009, yet August 2009 saw just 1 sale in this affluent price band. Among the sales last month, was a $5.1 million trade in Belvedere (an amazing home on a double lot on the Belvedere Lagoon) and an off-market $8 million Kentfield (both buyers and sellers were represented by my company). The reasons for the slowdown in sales is no mystery, so too are the reasons we will eventually return to normalcy. First and foremost, the economy must give reason for optimism and the stock market must continue to win back gains lost over the past year. Once some of those gains are recaptured, affluent buyers will feel more comfortable with major purchases again. And it looks like we are heading in that direction — last week, Ben Bernanke noted that the recession is likely over and the Wall Street Journal (a media source which is not-so-subtly slanted against real estate investment) noted that real estate “has rarely looked better” — click HERE for article. Also, for a detailed snapshot of current national trends from the Institute for Luxury Home Marketing dated September 13, 2009, click HERE.  And if you would like a hyper-local report relating to any town or zip code in Marin or San Francisco, call me at (415) 350-9440.
The below graph tracks asking prices for 3 “hot” locales in Marin — Tiburon/Belvedere (they are combined here because they use the same zip code), Mill Valley, and Kentfield. Interestingly, while Belvedere continues to see asking prices drop, Kentfield and Mill Valley have seen asking prices increase over the 60 days (although still lower than last year at this time).

The year over year inventory levels in Mill Valley have hovered at around 20% since May 2009 (much improved from a nearly 60% inventory increase in February 2009). Meanwhile, inventory in Kentfield has doubled this year compared with last year. In combination, Tiburon and Belvedere inventory levels are about 80% higher than last year.

The graph below reflects a 90-day rolling average of asking prices for homes in the topmost quartile (e.g. prices of the most expensive homes) in 3 touchstone Marin County cities: Tiburon, Mill Valley, and Kentfield. As you can see, over the past year, prices have declined, although asking prices appear to have leveled in all 3 towns.
Below is a new chart focusing on the percentages of homes in Tiburon and Mill Valley that have experienced price reductions, as well as a look at how deep those reductions have been, on average.

Real Estate Market Chart by Altos Research www.altosresearch.com

$2 Million to $4 Million Luxury Homes
Summertime is a traditional slow season for Marin real estate because many families focus more on vacations than on home buying. While buyer activity has picked up significantly, home sales in August 2009 were limited to seven. It seems that there is a lot of home shopping going on, but not a whole lot of sales (this August we had 62% fewer sales than one year ago). Inventory remains low with 133 homes on the market between $2 million and $4 million.
Cities recording sales in this price band included: Ross, San Rafael, Novato, Larkspur, Corte Madera, Tiburon, and Sausalito. These homes averaged 123 days on market. Their average sales price was $2.542 million (roughly $655 per square foot), with an average of 4,195 square feet. The absorption rate for Marin homes in this price band is up to 19 months.
$4 Million & Up Ultra-Luxury Homes
The inventory level of Marin County’s ultra-luxury market (homes priced in the $4 million and up range) remained virtually unchanged with 56 homes for sale. The highest concentrations of homes in this price band are Tiburon, Belvedere, and Ross. As noted earlier, Marin County saw just two sales last month — a spectacular Belvedere Lagoon home which sold for over $5 million and an off market sale of a Kentfield estate. There is another Belvedere home currently in escrow. Marin cities and towns with homes priced over $4 million include Tiburon, Belvedere, Sausalito, Kentfield, Ross, Mill Valley, San Rafael, and Novato.

Marin Cities & Towns

$2 Million — $4 Million

$4 Million & Up

Active

Pending

Active

Pending

Sausalito

13

0

7

0

Belvedere

18

3

11

1

Tiburon

33

2

22

0

Mill Valley

30

3

5

0

Larkspur

3

0

0

0

Corte Madera

0

0

0

0

Kentfield

10

3

3

0

Greenbrae

1

1

0

0

Ross

9

1

6

0

San Anselmo

7

0

0

0

San Rafael

7

0

1

0

Novato

5

0

1

0

The above graph identifies the numbers of active listings and homes in contract in the Marin County luxury ($2 million to $4 million) and ultra-luxury ($4 million and up) 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 (Western Marin coastal homes are not included).By: Kyle Frazier, Marin Realtor & CRS, Broker Associate, Morgan Lane Marin Real Estate, at 415/350-9440 for more luxury home market information. You can also e-mail Kyle at mailto:Kyle@ImagineMarin.com.

For help finding the perfect home for your lifestyle, Click HERE, fill out the confidential Home Preferences Survey, and Kyle will personally call you for a consultation.

Marin County, California, Luxury Homes Report (July 2009–Sales and Inventory Analysis)

Marin County, CA’s luxury real estate market segment is slow and remains weighted towards homes priced under $4 million — just one home priced over $4 million sold in June 2009 and it was an off-the-market sale. The number of sales in June 2009 is off by over 40% from June 2008, yet the average price of sold homes is down just 3% from last year. In Marin, only the homes with special locations, views, or features seem to be getting significant attention. For a detailed snapshot of current national trends from the Institute for Luxury Home Marketing dated July 19, 2009, click here. Note, if you would like a local report relating to any town or zip code in Marin or San Francisco, call me at (415) 350-9440. Yet, the news relating to home starts and permit applications is again improved this month. As earnings reports come in for Q2 and the stock market has found some hope in the numbers, it does not appear that such developments consitute the siren call buyers seek. 

As noted last month, buyers remain dubious of price stability for good reason. But, increased conforming loan limits and a pronounced level of increased affordability across the board should help sales moving forward into the Summer as buyers with 25% down will obtain top-shelf financing for purchases of $1.6 million. While not “Luxury” territory here in Marin, a sizable segment of buyers of luxury homes must sell their current homes first (80% of buyers are sellers). The chart below indicates that across the trend in Marin’s luxury segment is for lower prices — 10% to 28% lower than last year in Mill Valley, Belvedere, and Kentfield.

The year over year inventory levels in Mill Valley have hovered at around 20% for the past couple of months. Meanwhile, inventory in Kentfield has rocketed to 60% higher than last year. Belvedere is 75% higher than last year. Prediction: Kentfield and Belvedere prices will continue to recede markedly through Q4 2009. Indeed, we can see that trend has set in dramatically in the above chart.

Despite the apparent slowdown, open houses have been extremely busy. Offers are being written. And our agents are noting a more focused approach by buyers. One listing in our office, priced at over $10 million went into escrow last week after just 3 days on the market. We are also starting to see buyers lose out on properties they loved because they assumed there was no urgency in writing an offer. The graph below reflects a 90-day rolling average of asking prices for homes in the topmost quartile (e.g. prices of the most expensive homes) in 3 touchstone Marin County cities: Tiburon, Mill Valley, and Kentfield. As you can see, over the past year, prices have declined, although asking prices appear to have leveled in Mill Valley and Tiburon.

 

Below is a new chart focussing on the percentages of homes in Tiburon and Mill Valley that have experienced price reductions, as well as a look at how deep those reductions have been, on average.

Real Estate Market Chart by Altos Research www.altosresearch.com 

The definition of this market stat is:

“Percentage of homes on the market that have decreased their asking price at least once over the past 90-day period.” In any market, even in strong seller’s markets, there will always be some number of properties that will decrease their listing price. These may include sellers that drastically overpriced their homes just “to see what they could get” or homes that simply entered the market at a price level above what the market will bear.

Even in strong seller’s markets, the Percent Price Decreased will be 10-12%, so some repricing of individual properties is common in any market. In weaker markets, this value begins rise into the teens, 20%, 30%, and higher. Percent Price Decreased is an incredibly insightful gauge of demand levels in the residential housing market. This statistic illustrates how many listed properties may be behind the “price curve” – listed at a price above what the market is willing to pay for similar properties. However, “Percent Price Decreased” alone does not indicate the overall health of a particular market. This statistic should be combined with other market stats to determine the overall direction of a market.

$2 Million to $4 Million Luxury Homes

Historically, the Summer has been slow for Marin real estate because many families focus more on vacations than on home buying. But nothing has gone according to historical precedent in 2009. And this year buyers seem to be spending time between school years focussing on locating the perfect home at a value price. Inventory hovers at 135 homes on the market between $2 million and $4 million (down from 143 last month, but up from 110 in March).

Quick recap: Since the emergence of the “new economy” (typically identified as post-October 2008), sales numbers in this price band are down overall, but improving. For example, there were 18 sales in October 2008 (a relatively strong time of year for sales and, of course, these buyers were well into their escrow periods at the time of the meltdown). Then, by February 2009, sales dipped to just 2. As things began to improve in April & May 2009, sales bumped up to 8. The first 3 months of 2009 were simply abysmal. Overall, the past six months were the worst we have seen in 16 years. 

Yet, June 2009 was realtively strong with 16 sales and today we have an additional 18 homes in escrow. To sustain the apparent transition, we will need to see a sustained level of demand. May and June 2009 activity may represent the beginning of this recovery. However, the current rally described here applies only to units sold, not price appreciation.

Cities recording sales in this price band include: Tiburon (3), Belvedere (1), Mill Valley (3), Larkspur (1), and Kentfield (1), Ross (4), San Rafael (1), and Novato (1). These homes averaged 70 days on market. Their average sales price was $2.6 million (roughly $714 per square foot), with an average of 3,769 square feet. We also have a good number of homes in the escrow pipeline, including homes in Belvedere (4), Tiburon (5), Mill Valley (2), Ross (2), and Kentfield (2), and San Rafael (1), and Novato (1). The absorption rate for Marin homes in this price band is reduced to just under 10 months (down from nearly 18 months). Sellers must position their home at the head of the line when it comes to pricing if they want to sell.

$4 Million & Up Ultra-Luxury Homes

The inventory level of Marin County’s ultra-luxury market (homes priced in the $4 million and up range) remained static with 55 homes for sale. The highest concentrations of homes in this price band are Tiburon, Belvedere, and Ross. As referenced above, there was just one sale last month — an off-the-market sale of a spectular home for $5 million in Mill Valley’s Country Club neighborhood. We have 2 homes currently in escrow in this price range. Marin cities and towns with homes priced over $4 million include Tiburon, Belvedere, Sausalito, Kentfield, Ross, Mill Valley, San Rafael, and Novato. The absorption rate for these homes cannot be accurately stated as the number of sales is too low to be meaningful.

Marin Cities & Towns

$2 Million — $4 Million

$4 Million & Up

Active

Pending

Active

Pending

Sausalito

13

1

7

0

Belvedere

26

4

11

0

Tiburon

20

5

20

1

Mill Valley

30

2

4

0

Larkspur

3

0

0

0

Corte Madera

1

0

0

0

Kentfield

12

2

3

0

Greenbrae

1

0

0

0

Ross

8

2

7

1

San Anselmo

7

0

0

0

San Rafael

7

1

2

0

Novato

6

1

1

0

The above graph identifies the numbers of active listings and homes in contract in the Marin County luxury ($2 million to $4 million) and ultra-luxury ($4 million and up) 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 (Western Marin coastal homes are not included).By: Kyle Frazier, Marin Realtor & CRS, Broker Associate, Morgan Lane Marin Real Estate, at 415/350-9440 for more luxury home market information. You can also e-mail Kyle at mailto:Kyle@ImagineMarin.com.

Marin County, California, Luxury Homes Report (January 2009–Sales and Inventory Analysis)

Marin County, California, Luxury Homes Report (January 2009–Sales and Inventory Analysis)   While many bankers, lawyers, and executives received annual bonuses this year, many others did not. It can be expected that the resulting impact on the luxury market will be felt. Last month I noted a sluggish high end for Marin County real estate and nothing much has changed. In fact, sales and escrows slowed further. National number reflect a similar trend. Click here to view the Institute for Luxury Home Marketing’s Housing Report dated 1/4/09. If you would like a similar report relating to any town or zip code in Marin or San Francisco, e-mail me and I will send you a pdf of the report.

There are 69 homes on the market between $2 million and $4 million (down from 85 last month). Since the September financial meltdown, the sales numbers in this market segment have taken a significant hit. For example, while there were 18 sales in October 2008 (these buyers were well into their escrow periods at the time of the meltdown), December 2008 recorded just 4 sales. Only Tiburon (with 3) and Belvedere (with 1) had homes sell in this price band last month. These homes averaged 49 days on market (these were homes priced to sell). Their average sales price was a fraction under $2.5 million (roughly $813 per square foot), with an average of 3,230 square feet. Belvedere and Tiburon have 3 and 2 homes, respectively, currently in escrow. Mill Valley, Larkspur, and Ross each have one home in escrow. 

The inventory level in Marin County’s ultra-luxury market (homes priced in the $4 million and up range) has dipped to 31 active listings. These homes are often taken off the market for the Winter because: (1) the landscaping and general appearance of the grounds lack the pop and color of warmer months; (2) the sellers, who tend to be positioned such that an immediate sale is not required, do not care to be tormented by showings; and (3) by removing the home from the market for the Winter, the “days on market” clock is reset and begins again at zero. As always, Belvedere and Tiburon provide the majority of ultra-luxury homes. Other cities / towns with homes priced over $4 million include Kentfield, Sausalito, Mill Valley, Ross, San Rafael, and Novato. There have been no sales in the past 2 months, which, despite the state of things, seems surprising. Generally, we would expect 2-3 sales per month during the slow season. And again, as with last month, zero ultra-luxury homes are in escrow–although these sales often get completed beneath the radar. 

 

 

Marin Cities & Towns

$2 Million — $4 Million

$4 Million & Up

Active

Pending

Active

Pending

Sausalito

4

0

1

0

Belvedere

6

3

6

0

Tiburon

23

2

13

0

Mill Valley

6

1

2

0

Larkspur

2

1

0

0

Corte Madera

1

0

0

0

Kentfield

9

0

2

0

Greenbrae

0

0

0

0

Ross

1

1

5

0

San Anselmo

9

0

0

0

San Rafael

6

0

2

0

Novato

2

0

0

0

 

The above graph identifies the numbers of active listings and homes in contract in the Marin County luxury ($2 million to $4 million) and ultra-luxury ($4 million and up) 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 (Western Marin coastal homes are not included). Call Kyle Frazier, Marin Realtor & CRS, Broker Associate, Frank Howard Allen Realtors of Marin, at 415/350-9440 for more luxury home market information. You can also e-mail Kyle at mailto:Kyle@ImagineMarin.com.

Marin Luxury Homes Report (December 2008)

Marin County, California, Luxury Homes Report (December 2008–Sales and Inventory Analysis)   Ponzi schemes, equity markets, banking woes, mounting unemployment, diminished home values and equity, generalized fear, and a palpable spending paralysis continue to weigh down and negatively impact luxury real estate sales in Marin County, California. I struggle to find the appropriate adjective to describe Marin County’s current luxury home market. Torpid? Sluggish? Drowsing? You get the idea. The same holds true nationwide as caution and prudence carry the day (click here to view the Institute for Luxury Home Marketing’s Housing Report dated 12/12/08).

There are 85 homes on the market between $2 million and $4 million. As predicted in last month’s update, November sales slowed significantly following the mid-September meltdown in the financial sector–there were only 5 sales (down from 19 in October). Each of the following cities or towns had one sale: Mill Valley, San Rafael, Tiburon, Belvedere, and Kentfield. The average days on market for the homes that sold was 80 days and the average sales price was just over $2.58 million (roughly $849 per square foot), with an average of 3,209 square feet. Belvedere and Tiburon have 5 and 3 homes, respectively, currently in escrow. 

The inventory level in Marin County’s ultra-luxury market (homes priced in the $4 million and up range) has again dropped precipitously (as is common this time of year). There are now 34 active listings, compared with 49 in November. Belvedere and Tiburon provide a large percentage of our ultra-luxury homes. Other cities / towns with homes in this price band include Kentfield, Sausalito, Mill Valley, Ross, San Rafael, and Novato. Somewhat surprisingly, there were no sales last month (we can usually expect at least 3 sales per month during the slow season). Further underscoring the pervasive caution gripping buyers, we currently have no ultra-luxury homes in escrow.  

 

Marin Cities & Towns

$2 Million — $4 Million

$4 Million & Up

Active

Pending

Active

Pending

Sausalito

6

0

1

0

Belvedere

7

3

9

0

Tiburon

24

5

11

0

Mill Valley

15

0

3

0

Larkspur

6

1

0

0

Corte Madera

0

0

0

0

Kentfield

8

0

2

0

Greenbrae

0

0

0

0

Ross

5

1

5

0

San Anselmo

11

0

1

0

San Rafael

10

0

2

0

Novato

3

0

1

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 (Western Marin coastal homes are not included). Call Kyle Frazier, Marin Realtor & CRS, Broker Associate, Frank Howard Allen Realtors of Marin, at 415/350-9440 for more luxury home market information. You can also e-mail Kyle at mailto:Kyle@ImagineMarin.com.