Char’s September 2023 Blog – Market Update

Stay Up-To-Date on Industry Trends & Forecasts

Did You Know?

“I think people forget that the vast majority of sellers are also trying to buy at the same time. When conditions are tough for buyers, it can hold back selling inventory as well.” – Danielle Hale, Realtor.com
Parents who wish to gift their home that has (increased dramatically in value, thereby subjecting it to capital gains taxes) to kids should instead consider transferring the home into an irrevocable trust that names your children as beneficiaries. This way it will no longer be a part of the estate upon death, thereby avoiding any estate taxes and capital gains taxes. The house will also not be subject to Medicaid estate recovery. Once the house is in the irrevocable trust, it cannot be taken out again. If sold, the proceeds must remain in the trust. Similar to making a gift, if you apply for Medicaid within 5 years of transferring the house, you may be subject to a Medicaid penalty period.

Tools – Are You Ready?

With the uncertainty of how the market will be in the 4th quarter of 2023, it is worth suggesting that using this time, as a buyer and a seller, to get your ducks in a row so you are ready when your opportunity arises is worth the effort. The market will change in 2024. Will you be ready? Have questions? I’m here to help.

For Sellers:

Getting Your Home Ready To Show (PDF)
Danger and Consequence of Overpricing (PDF)
Compass Concierge Powered by Revive – (PDF)

For Buyers:

Are You Ready? Planning Is Crucial (PDF)
Buyers Guide (PDF)
Searching and Want List (PDF)

Trends & Forecasts

Insurance Crisis: Another Major Home Insurer To Limit Business in California
As climate risks rise, home insurers cut natural disasters from policies
Housing Market Predictions For 2023: When Will Home Prices Be Affordable Again?
Sonoma County Market Flipbook
National Real Estate Insights

Market Update

We recently came across some statistics regarding the impact of “over-pricing” a property and found this remarkably simple statement with a wealth of truth: “Neither agents nor sellers determine market value. Only the market itself – willing and able buyers – establishes value.” Time and again we have seen situations where an overpriced listing is stigmatized, and the eventual sale price is reduced to less than it would have been with more realistic pricing. As we have stressed in the past, a comprehensive market analysis is the best way to estimate the market value, but only a buyer can truly establish that value based on the price they are willing to pay.

As we reflect on the Sonoma Valley August statistics, we can, once again, see the trend of high median list prices ($1,674,500 in 2023 and $1,524,000 in 2022) as compared to the median sales prices ($1,025,000 in 2023 vs $1,195,000 in 2022). Besides the comparison year over year, it may be more interesting to compare the median lists price in each year vs the ultimate median sales price which this year amounts to a difference of over 38% between the two. This is not uncommon and has been the trend we have seen throughout this year.

The interesting aspect of this specifically in Sonoma Valley is that these high list prices (as compared to the final sales prices) do not appear to affect the number of days on the market (DOM) which is still relatively low at 47 days, among the lowest in August in 2023.

Looking ahead, we are entering what is traditionally the last market thrust of the year. As summer unofficially ends on Labor Day, we often see a burst of activity that runs until the start of the holiday season. It’s true that the holiday season seems to start earlier and earlier, as evidenced by the Halloween – yes, even the Christmas decorations – that appear even before the ‘back to school’ supplies start their reductions. So, it remains to be seen how long and how robust our fall selling season will be.

Please note, all information is for single family residences in the Sonoma Valley as reported to BAREIS, the local multiple listing service through Broker Metrics.

This BLOG is intended to provide information and content of value. Suggestions about what you would like to see more of, feel free to email me and certainly feel free to forward to friends and family.

Main Content