Gerrett Snedaker: Wine Country Real Estate Trends in May 2021

Wine Country Real Estate Trends in May 2021

GERRETT SNEDAKER, CRB

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YEAR OVER YEAR COMPARISONS

In mid-March 2020, the COVID19 pandemic was declared and all parties were told to “Shelter in Place”. This basically shut down the residential real estate industry through the month of May 2020. The market then accelerated rapidly in May through October. Year over year statistical comparisons are therefore going to be skewed by these market aberrations. North Bay Real Estate Trends for May 2021 For all of the areas covered by our Multiple Listing Service

GETTETT (BAREIS), which includes SNEDAKER Lake, Marin, Mendocino, Napa, Solano and Sonoma Counties, there is an inventory of 1,804 homes and condominiums for sale at the end of May. Inventory is 43% below that of a year ago (3,151) and it is 10% ahead of the inventory last month (1,635). At times, the inventory has exceeded 10,000 homes in the BAREIS region. There were 1,924 sales for the month of May. This number is 17% above a year ago (1,640) and 6% ahead of the pace of last month (1,819).

I have been following a data point I call the “Price Reduction Ratio” for the past six months, or so. Across the country, one might expect that 20 to 25% of the homes put into the MLS will have a price reduction before they eventually sell. For May 2021, of all closed homes in our Wine Country markets, the range was from 13% (Mendocino and Napa Counties) to 15% (Sonoma County). Conversely, the ratio of homes selling in excess of Original List Price ranged from 49% (Mendocino) to 61% (Sonoma County). It was 56% in Napa County. The average Price Reduction Ratio for all areas has gone from 29% in September 2020 to 14% in May of 2021 while the sales of homes in excess of Original List Price went from 33% to 55% over the same period.

NAPA COUNTY

The inventory of homes and condominiums available for sale in Napa County at the end of May (262) is 34% below the inventory in May 2020 (398) and it is 15% above the inventory last month (228). Sixty-seven percent of the inventory in Napa County (175 properties) is priced at $1,000,000 or above. New sales (168) are 41% ahead of the pace of last year (119) and are 4% above the 161 sales last month. There is a 1.6 months supply of inventory based on the current sales pace. The Days on Market for homes closing in Napa County is currently 46 days. For the purpose of our MLS (BAREIS) “Days on Market” represents the time from when the property is first listed in the MLS to the date the property goes into “pending” (all conditions removed) status. On average, it can take anywhere from 0 to 30 additional days for properties to close after going pending. The median price of the 141 homes closed in May in Napa County ($800,000) is 28% ahead of the median price of a year ago ($625,000). Over the past four months, Napa County homes are selling at roughly 96% of original list price.

NAPA COUNTY LUXURY HOMES

If one takes the highest quartile (25%) of available inventory as the “Luxury Market”, the Luxury Market begins at $3.500,000 in Napa County at this time. There has been an increase of 134% for the number of closings (78) of Luxury Homes (sales price in excess of $3,500,000) in Napa County for the period 6/1/20 to 5/31/21 compared to 31 closings in the period 6/1/19 to 5/31/20. There are 67 luxury homes in inventory at the end of May 2021 which is the same as the inventory at the end of May 2020. There were 8 new Luxury Home sales in May compared to 8 last year and 12 last month. This results in a 7.5 months supply of available Luxury Homes based on the current sales pace compared to a 1.6 months supply for the County as a whole. Days on market for the 5 luxury homes closings in May was 98 days. Over the past four months, Napa County Luxury Homes are selling at roughly 90% of original list price.

NAPA

Fifty-four percent of the inventory in Napa County is in the City of Napa. There are 141 available homes and condominiums in inventory at the end of May in the City of Napa. This is 34% below the supply at the end of May 2020 (213) and it is 17% above the

inventory at the end of last month (121). New sales (125) were 67% ahead of the pace of May 2020 (75) and they were 18% above the pace of last month (106). There is a 1.1 months supply of inventory based on the current sales pace. The Days on Market for the 92 closings last month was 39 days. The median price of the homes that closed in the City of Napa in May was $815,000. This is 23% ahead of the median price of the homes closed in May 2020 ($665,000).

UP VALLEY NAPA COUNTY

The inventory of homes and condominiums for sale in the Up Valley Napa County market (Angwin, Calistoga, Deer Park, Oakville, Rutherford, St. Helena and Yountville) at the end of May (101) is 24% below the level of 132 in May 2020 and it is 15% ahead of the inventory last month (88). There were 25 new sales this month compared to 21 a year ago and 34 last month. There is now a 4.0 months supply of inventory based on the current sales pace. The Days on Market for the 26 closings last month was 71 days. Approximately 51% of the Luxury Market inventory (price in excess of $3,500,000) in Napa County is in the Up Valley Market (34 homes). There were four luxury home (price in excess of $3,500,000) closings in the Up Valley Market last month and there were five new luxury home sales.

AMERICAN CANYON

There are only 5 available homes and condominiums in inventory at the end of May in American Canyon. This is 78% below the inventory a year ago (23) and it is slightly below the supply last month (7). There were 10 new sales in the month. This is 17% below the pace of last year (12) and 11% above the 9 sales last month. There is a 0.5 months supply of inventory based on the current sales pace. American Canyon remains the tightest market in Wine Country. The Days on Market for 7 homes that closed in American Canyon last month was just 36 days. The median price of the homes that closed in American Canyon in May ($745,000) was 35% ahead of the median price of a year ago ($553,000). The average price per square foot of the homes sold in American Canyon was at $339 last month, This is above the $275 to $300 range where the sales have been over the past several years.

For additional information please contact Gerrett Snedaker at 707-939-2009 or gsned@ winecountrygroup.com

For more information, please contact Gerrett Snedaker at 707-939-2009 or gsned@ winecountrygroup.com.