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

Pacific Union International – Christie’s Great Estates | Marin County, CA Luxury Home Sales (February 2011)

Pacific Union Int’l – Christie’s Great Estates | Marin County, CA Luxury Home Sales (February 2011) — In line with expectations, January 2011 luxury home sales were limited with 9 trades (there were just 6 in December 2010). Of course, many buyers, most economists, and consumer sentiment are feeling bouyant about our the economic and housing environments. Indeed, there are extraordinary opportunities available right now for buyers as pricing in the marketplace (especially for homes that have remained on the market through the Winter months) is soft and “value” is evident in virtually every segment of the luxury segment. In line with normal seasonal adjustments, the inventory of luxury homes for sale is very low — just 96 homes total on the MLS over $2 million in Marin.

Cities recording luxury home sales between $2 million and $4 million in February 2011 included: Belvedere (1), San Anselmo (1), San Rafael (1), Tiburon (1), Kentfield (3), and Ross (1). These homes averaged 116 days on market. Their average sales price was $2.521 million (roughly $807 per square foot), with an average of 3,522 square feet. Marin County’s ultra-luxury market (homes priced in the $4 million and up range) accounted for zero sales last month and there are currently zero such homes in escrow.

Note: As a member of the Top Agent Network (top 10% in Marin) and the Marin Platinum Group (Top 100 agents), I have access to a database with several dozen luxury homes not currently on the MLS, but discretely offered for sale off-market. Please contact me regarding your specific desires.

By: Kyle Frazier, Certified Luxury Home Marketing Marketing Specialist (CLHMS), Certified Residential Specialist (CRS), Broker Associate, Realtor | Christie’s Great Estates — Christie’s Great Estates. Call Kyle Frazier at 415/350-9440 for more luxury home market information in Marin County, California (the San Francisco Bay Area’s “North Bay”).

Marin County, California, Luxury Homes Report (February 2010–Sales and Inventory Analysis)

Marin County, California’s luxury home market continues to recover from the proverbial wasteland of late 2008 and early 2009 when it seemed as though the luxury home market would never recover. Yet, as reported in previous months, real buyers continue to snap up homes in prestige locations such as Belvedere, Ross, Kent Woodlands, etc. Indeed, “value” properties are gobbled up quickly. Despite this apparent thirst for luxury digs, inventory levels remain 40% higher than two years ago. This trend is not unique to Marin, but prevails nationwide. For a detailed snapshot of current national trends from the Institute for Luxury Home Marketing, click HERE.

The below chart reflects the number of homes in the $2 million to $4 million luxury price band which are in escrow (compared against the past 2 years). Note that the number of homes with accepted offers (not closed sales), is up 50% from 2 years ago and 450% from last year. This is a promising trend.

Another statistic that may not be readily apparent to casual observers is the fact that prices in the $2 million to $4 million price band are stabilizing as median sales prices countywide are down just 6% over the past 2 years. Of course, the impact of the downturn varies greatly by neighborhood and even within neighborhoods based on amenities.

$2 Million to $4 Million Luxury Homes

Following a very strong November and December 2009, sales in January 2010 reflected our typical seasonal slowdown as Marin County recorded just 4 trades. Yet, we have another 13 homes in escrow. Certainly, buyers are feeling some urge to buy as it appears that the poor economic environment may be improving and the pricing in the marketplace suggests “value.” Inventory remains low (although higher than last month) at just 70 homes on the market between $2 million and $4 million.

Cities recording January 2010 sales in this price band included: Belvedere (1), Mill Valley (1), Kentfield (1), and Tiburon (1). These homes averaged 239 days on market. Their average sales price was $2.542 million (roughly $626 per square foot), with an average of 4,015 square feet. The absorption rate for Marin homes in this price band is 17.5 months (which is high due to the low number of trades and increased inventory).

$4 Million & Up Ultra-Luxury Homes

The already low inventory level of Marin County’s ultra-luxury market (homes priced in the $4 million and up range) held steady at 36 homes for sale. The highest concentrations of homes in this price band are Tiburon and Belvedere. Marin County experienced 2 sales last month in this price band — one was Sean Penn’s estate and the other was a one-of-a-kind supreme location estate which sold for $14 million. Both sales were in Ross and the latter was accomplished via a Morgan Lane buyer client.   

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 (November 2009–Sales and Inventory Analysis)

Building on a trend noted in last month’s report, media coverage of the overall economy has improved. In particular, reporting on the housing market. 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 — over 80% of economists surveyed think the recession is over and recovery has begun. The Mortgage Bankers Association Chief Economist Jay Brinkmann, predicts that sales of existing homes will rise 11 percent in 2010, with sales of new homes climbing 21 percent.

But, perhaps more importantly, the Dow Jones has rocketed up past 10,000 and the tone of the W-shaped recovery dialogue has moderated. It was announced today that JPMorgan Chase plans to hire 1,200 mortgage bankers in light of improved housing market and signs of stability.

Finally, we know from past experience that in down cycles, once the San Francisco housing market recovers, there is a domino effect on surrounding communities. Accordingly, in our current cycle, we believe that our best leading indicator regarding a healthy, appreciating market (particularly in Southern Marin) will be the home sales environment in San Francisco. And there can be no doubt that the San Francisco market has improved dramatically in recent months. Additionally, as the banking institutions regain their footing and again provide bonuses to their employees, we will also see a surge in luxury home sales. In fact, if bonuses are significant and broad-based, I predict a very strong luxury sales market early in 2010 as buyers snap up the many “values” out there in the luxury and ultra-luxury sectors.

As reported in previous months, real buyers have become less numerous. They are placing emphasis on prestige locations, views, lifestyle amenities (usable yards, proximity to clubs/shopping, etc.), schools, and sensible scale. And they are seeking “value.” The Marin County luxury market has favored homes priced under $3 million — although 5 homes traded over $4 million in November 2009. [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, e-mail or 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 last 4 months. 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, but has dipped to about 15%. Meanwhile, inventory in Kentfield is up 65% 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 35% 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

As we begin to see the contours of the Winter market form, many feel we will have an active Winter. Many agents are noting (and this is backed up by the numbers) that we had our best month of the year in October. Buyer activity has picked up significantly. The number of sales (9) and homes in escrow (17) remain quite strong. There is a lot of home shopping going on as patient buyers have begun snapping up homes that they perceive represent “value.” I expect that next month will see a continued surge of sales. Inventory remains low with 108 homes on the market between $2 million and $4 million.

Cities recording sales in this price band included: Tiburon (1), Belvedere (1), Ross (1) Mill Valley (3), Sausalito (1), and San Rafael (2). These homes averaged 98 days on market. Their average sales price was $2.858 million (roughly $799 per square foot), with an average of 3,673 square feet. The absorption rate for Marin homes in this price band is about 12 months (down from 18 months in October).

$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 47 homes for sale. The highest concentrations of homes in this price band are Tiburon, Belvedere, Sausalito, and Ross. As noted earlier, Marin County experienced 5 sales last month and these homes had the following characteristics: days on market – 111, price – $5.86 million, square feet – 5,030, price per square foot – $1,011. Note that Christie’s | Morgan Lane agents were involved in three of the five sales in this price band last month.

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.