Three weeks ago a milestone was reached in Healdsburg. According to Redfin, for the first time this year a million dollar home was sold in the Healdsburg area. Compare this to the glory days of, dare we say... 2007, when 15 million dollar homes were flying off the shelf.
I don't have easy access to the data more than 3 years back but I'm guessing that in 2005 the numbers were even higher.
Back then, a million dollar home was your ticket to a quick quarter million dollars when you would flip the place after putting in granite counter tops, hardwood floors, and remodeling a bathroom.
Today, a quarter million dollars is the amount of cash you need for a down payment to buy such a home. For that reason there is but one sale year to date.
Two things to note about this particular sale on 235 Appaloosa Trail overlooking some of the foreclosed homes we've covered in the past:
1) the previous owner took a loss (it last sold for $1,295,000 in 2004, compared to the sale price last month of $1,150,000).
2) in Healdsburg there are 18 other single family homes listed above $1 million according to Redfin. Just yesterday, two more hit the market (here and here). If the 2009 sales pace continues it will only take 9 years to clear the current inventory.
Strange that you should base your comments on unreliable statistics.
ReplyDeleteBut perhaps they better fit your agenda?
Better facts are that year to date 9 properties over $1M have sold in the 95448 zip code - 2 are in the City limits, the rest are nearby. There are 8 such properties in escrow now, 3 are in the City limits.
Eric
according to the mls, there have been 8 sales over a million dollars this year in Healdsburg.
ReplyDeleteAs far as I can tell the Redfin data is correct.
ReplyDeleteThe graph above shows “Single Family Residential” units, not “Multi-Family”.
There was another property that sold for over $1 million (423 Haydon St.) but it was listed as Multi-Family and therefore not included.
I used data on SFR within the city limits as I felt it was a more apples to apples comparison.
A multi-family unit is going to produce income, and could justify the higher price.
For properties outside of city limits the lots can be much bigger (data I didn't have access to). Obviously a 40 acre parcel selling for $1 million is much different than a home on 1/2 of an acre selling for $1 million. Add a vineyard (or vineyard potential) and you really can’t compare the two.
Later on in the week I’ll possibly do another post and include the multi-family units. Looking at the Redfin data I also noticed I can go back further than July 2006 so I can include that as well.
Interesting stuff the three properties in escrow in city limits. I’ll be able to see them once they close.
Clearly, there are people that think it is a good time to buy. I’m just not one of them.
And one thing that is for sure is that however you look data sales of million dollar homes have plummeted.
"And one thing that is for sure is that however you look data sales of million dollar homes have plummeted."
ReplyDeleteMakes total sense. Jumbo financing now requires hefty down payments....25%, 30%, etc. plus sizable reserves. Gone are the days of tiny down payments on a $1M home, limited documentation, etc.
So how many people have $300K for a down payment, plus reserves, and how many of these folks don't already own a home?? And for those sitting on the sidelines, what's the big incentive to buy right now? CA's finances just imploded, and at some point, the consequences will come into focus....less in services, more in taxes, etc.
Makes sense except for my atrocious grammar. Throw a "at the" before "data" and it reads a little better.
ReplyDeleteRelated to the above The Field Check Group just put out this report that is well worth the read(click the link to the right to read the whole thing):
...Here we sit again but this time with the mid-to-high end properties staring into the abyss. They have not fallen anywhere near what the low-end has mostly because high-end borrowers were given more exotic, high-leverage loan programs such as Pay Option ARMs, 5/1 interest only loans, and 100% HELOCs to live off of. Arguably they have more reserves and better jobs, which have kept them paying for the depreciating asset much longer than with Subprime borrowers. The Alt-A and Jumbo Prime borrowers simply have loans that afforded them more time. But that has all changed and defaults across this space are surging. Foreclosures are coming, but not before the market begins its slide that ultimately will take the mid-to-high end market down 50% to 70% from its peak 2007 levels.