Although at a nationwide level, we’re seeing sellers give in to higher interest rates, causing existing inventory to build in the market, we’re not seeing the same thing in the North Bay. Despite nationwide increases in inventory, the number of active single-family home listings has decreased by 12.02% on a year-over-year basis in the North Bay. It is important to note that the condo market did see a slight increase in inventory of 6.14%, but this represents a much smaller segment of the market.
This overall decrease in inventory suggests that buyers continue to enter into bidding wars to secure the homes of their dreams. Of course, this has led listings to stay on the market for shorter periods of time, with the average home staying on the market for 32 days in Sonoma, 18 days in Marin, and 36 days in Solano, representing year-over-year decreases of 5.88%, 5.26%, and 5.26%, respectively.
It’s important to note though, that although Napa saw a spike in median sale price this past month, the area also saw a huge spike in the number of days on market for single-family homes, with the average listing sitting on the market for 84 days, nearly double the amount of time a listing was sitting on the market around this time last year!
Napa continues to be a buyers’ market, while Solano, Marin, and Sonoma see fierce competition
When determining whether a market is a buyers’ market or a sellers’ market, we look to the Months of Supply Inventory (MSI) metric. The state of California has historically averaged around three months of MSI, so any area with at or around three months of MSI is considered a balanced market. Any market that has lower than three months of MSI is considered a seller’s market, whereas markets with more than three months of MSI are considered buyers’ markets.
In terms of the single-family home market, we’re seeing Sonoma, Marin, and Solano continue to be seller’s markets, with just 2.5, 1.8, and 2.2 months' worth of supply on the market at this point in time. Whereas Napa continues to be a buyers’ market, with 4.7 months of inventory on the market. The condo market at large remains a buyers’ market too, with 3.1 months of supply on the market in Sonoma, 3.6 months in Marin, 3.8 months in Solano, and 4.9 months in Napa.
