Wildfires Threaten SoCal Housing Markets Already Struggling with Unaffordability and Low Inventory, According to Redfin
15 December 2017 - 12:00AM
Business Wire
- National home prices rose 7.8 percent
in November as inventory declined 12.8 percent
- Pace and competition in housing market
continued to accelerate in November after 26 months of inventory
declines
- Sonoma County housing market felt
impact of October wildfires as inventory plunged 47 percent
- In Ventura and Santa Barbara counties
where wildfires are threatening homes, inventory has declined by
double-digits for three months straight and fires could worsen the
inventory shortage
- San Jose prices climbed 23 percent and
competition reached new heights in November
(NASDAQ: RDFN) — Home price growth was strong in November, up
7.8 percent from last year, according to Redfin (www.redfin.com),
the next-generation real estate brokerage. The median sale price
was $292,000 across the markets Redfin serves. Sales were down 1.3
percent. The number of homes for sale declined 12.8 percent
compared to a year ago, marking 26 months in a row of inventory
declines.
“Overall, 2017 has been an uneven year for home sales. The year
started out strong, but a combination of low inventory and weather
events overtook sales growth; sales have been flat to declining in
six out of the past 11 months,” said Redfin chief economist Nela
Richardson. “The good news is markets have been quick to recover
from severe weather events, even as challenges remain. For example,
Houston home sales were up 4.3 percent in November from a year ago,
and Tampa sales were up 6.1 percent. We are hopeful that Southern
California markets show the same level of resilience in the
aftermath of wildfires there.”
The number of homes newly listed for sale in November increased
a modest 1.1 percent. Any increase in new listings is welcome news
for buyers, however, the number of homes put on the market in
November wasn’t enough to put a dent in the long-standing inventory
shortage. There were 3.1 months of supply in November, far below
the six months of supply that represent a market balanced between
buyers and sellers. Nationally, the typical home spent 46 days on
the market, four days fewer than last November.
2017 has been the fastest market on record and if current trends
continue, Redfin predicts 2018 will be even faster.
Wildfires Threaten California Communities Already Facing
Inventory Shortages
In parts of Los Angeles, Ventura and Santa Barbara counties,
hundreds of homes have been destroyed by wildfires and hundreds
more are under threat from fires that remain uncontained. While it
is too early to know how many families and homes will be impacted,
we do know these counties are already facing a shortage of homes
for sale. Families who are displaced by the wildfires will find it
challenging to find another home for sale nearby.
In Ventura County in November, inventory was down 17.6 percent
and prices grew 9.8 percent year over year to a median of $600,000.
In Santa Barbara County, inventory was down 23.3 percent and prices
grew 6.8 percent year over year to a median of $575,000. The fires
will cause further stress in an already tight housing market.
“The fires have had a big impact on the people and communities
in and around Ventura, Ojai and Santa Barbara,” said Redfin agent
John Venti. “Our already low inventory levels are likely to take a
beating in the coming months not only from the loss of homes but
also the disruption of life and business in the area. A few
prospective home sellers have texted me as they were being
evacuated to cancel our listing consultation appointments. But
these fires, devastating as they are, are temporary. I’m optimistic
that people will resume their holiday festivities and business as
usual as soon as the fires are extinguished and the air
clears.”
The impact of the October wildfires in Northern California was
seen in November market data. In Santa Rosa, one of the hardest hit
cities, inventory fell 46.6 percent in November from a year prior,
a 27.8 percent drop from October. Across Sonoma County, inventory
declined 31.2 percent year over year and prices rose 15.2 percent
to a median of $633,000. The typical home in Sonoma County sold for
101.6 percent of the asking price, the highest sale-to-list price
ratio since 2013. This spike in competition is unusual for the
November market and likely related to the fires.
Home sales were up 8 percent year over year in Santa Rosa and
6.4 percent in Sonoma County in November. December sales in the
affected areas may decline as a result of the fire activity.
Other November Highlights
Competition
- The most competitive market in November
was San Jose, CA where 75.9% of homes sold above list price,
followed by 73.1% in San Francisco, CA, 66.0% in Oakland, CA, 43.5%
in Seattle, WA, and 42.0% in Tacoma, WA.
- The average sale-to-list price ratio in
San Jose was 107.9 percent, the highest on record in that market
since Redfin began tracking this data in 2009.
- San Jose, CA and Seattle, WA were the
fastest markets at 12 median days on market, followed by Oakland,
CA (14), Boston, MA (15) and San Francisco, CA (17).
Prices
- San Jose, CA had the nation’s highest
price growth, rising 23% since last year to $1,076,000. San
Francisco, CA had the second highest growth at 18.5% year-over-year
price growth, followed by Cleveland, OH (15.9%), Seattle, WA
(15.4%), and Salt Lake City, UT (13%).
- Honolulu, HI was the only metro with a
price decline in November falling 3.2%.
Sales
- 4 out of 73 metros saw sales surge by
double digits from last year. Richmond, VA led the nation in
year-over-year sales growth, up 14.6%, followed by Honolulu, HI, up
14.2%. Philadelphia, PA rounded out the top three with sales up
10.8% from a year ago.
- Allentown, PA saw the largest decline
in sales since last year, falling 13.3%. Home sales in Grand
Rapids, MI and Rochester, NY declined by 13.1% and 11.0%,
respectively.
Inventory
- San Jose, CA had the largest decrease
in overall inventory, falling 50.2% since last November. Atlanta,
GA (-32.1%), Buffalo, NY (-30.4%), and Oakland, CA (-29.1%) also
saw far fewer homes available on the market than a year ago.
- Salt Lake City, UT had the highest
increase in the number of homes for sale, up 40.3% year over year,
followed by Baton Rouge, LA (10.9%) and Austin, TX (9.1%).
To read the full report, complete with data and charts, please
visit the following link:
https://www.redfin.com/blog/2017/12/market-tracker-november-2017.html
About Redfin
Redfin (www.redfin.com) is the next-generation real estate
brokerage, combining its own full-service agents with modern
technology to redefine real estate in the consumer's favor. Founded
by software engineers, Redfin has the country's #1 brokerage
website and offers a host of online tools to consumers, including
the Redfin Estimate, the automated home-value estimate with the
industry's lowest published error rate for listed homes. Homebuyers
and sellers enjoy a full-service, technology-powered experience
from Redfin real estate agents, while saving thousands in
commissions. Redfin serves more than 80 major metro areas across
the U.S. The company has closed more than $50 billion in home
sales.
For more information or to contact a local Redfin real estate
agent, visit www.redfin.com. To learn about housing market trends
and download data, visit the Redfin Data Center. To be added to
Redfin's press release distribution list, subscribe here. To view
Redfin's press center, click here.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20171214005178/en/
Redfin Journalist Services:Alina Ptaszynski,
206-588-6863press@redfin.com
Redfin (NASDAQ:RDFN)
Historical Stock Chart
From Apr 2024 to May 2024
Redfin (NASDAQ:RDFN)
Historical Stock Chart
From May 2023 to May 2024