As the North Bay housing market boomed during the pandemic, more than half of single-family homes sold in the Santa Rosa-Petaluma area exceeded asking price, according to a new report.
A study by Porch Group, a website for finding home insurance and other services, reported that 53% of home sales in the area between January 2020 and September 2021 exceeded the listing price. That’s compared to 48.5% nationally.
Before the pandemic, at most only about a quarter of homes exceeded demand during peak summer homebuying months.
Of all the mid-size metropolitan areas in the country, Santa Rosa-Petaluma ranked 26th for the percentage of homes selling above asking price, according to the report. California cities including Stockton (ranked first at 71%), Modesto (ranked fourth at 68%) and Vallejo (ranked fifth at 67%) round out the top of the list.
In Sonoma County, the median sale price for single-family homes in October was $750,000, according to data compiled by Jim Michaelsen, Compass Real Estate sales manager in Santa Rosa and Petaluma. Although prices fell slightly compared to the previous month, this still represents a 5% increase compared to the same month last year.
Compared to September 2019, before the pandemic, the county’s median home price climbed nearly $100,000, or 15%, from $652,698.
The price spike is largely due to a rush of pandemic homebuyers flocking to Sonoma County from urban centers like San Francisco, Silicon Valley and beyond.
Since last spring, it’s not uncommon for homes to exceed the asking price by more than six figures, Michaelsen said. It fundamentally changed the way real estate agents had to navigate the market.
“You really have to pay attention to what’s currently on the market with houses you’re competing against when taking a listing,” Michaelsen said. “Because all of a sudden, something that sold a month ago may or may not be the right price for an ad today.”
In Sonoma County, a dearth of properties coming to market — the area continues to rebuild after losing about 6,000 homes to wildfires since 2017 — has only exacerbated price increases.
Of the number of houses lost, only about half have been rebuilt. And housing construction has slowed this year as the cost of building materials soared and global supply chains were disrupted.
Although local home prices began to decline as the winter months approached, Michaelsen said he still sees strong demand for single-family homes.
“We always see several offers on them,” he said. “There’s a lot of competition there, and there’s a lot of competition from cash buyers.”
You can reach editor Ethan Varian at [email protected] or 707-521-5412. On Twitter @ethanvarian